Australia’s grocery market has never been more fragmented – or more complex. For the first time, retailers and suppliers are serving six distinct generations at once: From Gen Alpha, just entering their influence years, to Baby Boomers, who still command the majority of household wealth. Each cohort brings its own expectations around value, loyalty, digital influence and shopping behaviour.
According to Sam Gilding, chief revenue officer – international, at consumer insight platform Vypr, understanding those nuances has become critical. “You’ve got six distinct shopper typologies that all vary. Almost every Gen Z or Millennial shops online using smartphones, but Boomers prefer a bigger screen and typically buy on computers. Retailers and brands now need to serve products and experiences in a far more diverse way than before.”
At the same time, 74 per cent of consumers in a recent Vypr study say they’ve changed their shopping habits in the past year. “You’ve got this generational complexity, a wealth gap, and a tendency for brands to over-index their marketing towards younger consumers – despite older generations holding most of the capital,” says Gilding. “The tension is real. Boomers feel left behind, while brands chase Gen Z and Millennials because they’re seen as trendsetters.”
Traditional demographic targeting is no longer enough. Gilding argues that brands must shift from blunt segmentation to behavioural insight. “You need real-time consumer intelligence – and to look at behaviours, not just age. Every Boomer I speak to feels ignored by brands and retailers, which makes no sense when they’re the ones with the money.”
He says brands need to be more deliberate about who they’re speaking to. “Most advertising is done with a broad brush, usually slanted toward younger shoppers. The challenge is to create campaigns that resonate with both those who have disposable income and those still building their purchasing power.”
The danger, he warns, lies in using outdated information. “You can’t use yesterday’s data to predict tomorrow’s shopper. Across all cohorts, three-quarters of shoppers have changed their behaviour. Brands that rely on static data are flying blind – or at best, flying with one eye closed.”
Agility, he adds, is becoming a defining competitive edge. “Speed and agility trump size. If you look at the growth of Temu, for example, their ability to move fast, test constantly, and adapt to how Gen Z, Millennials and Gen Alpha shop – mostly on smartphones – has been key to their rise.”
Six generations, one shelf
Retailers are now faced with a single shelf that must appeal to six different generations – each with different motivators, barriers and missions. “Older consumers may want trust and value, younger ones crave novelty and digital discovery,” says Gilding. “The question is how to deliver both.”
He points to Woolworths’ dual-track strategy as a smart example: Targeting value-conscious Millennials through its Everyday Rewards loyalty program, while maintaining premium offerings for more affluent shoppers.
Arnott’s, he adds, has mastered multi-generational product innovation by combining bold new flavours with nostalgic favourites. “They’ve been intentional – using distinct messages and innovations for different groups. The time for one-size-fits-all is over.”
The challenge is heightened by retailers’ moves to simplify ranges and cut SKUs for efficiency. “We worked with a smallgoods brand in Australia where one retailer rationalised its category. Our advice was: don’t just offer the same products as your rivals, create a value-added alternative tailored to a specific demographic,” Gilding explains.
Vypr’s research also found that shoppers don’t necessarily want endless choice – just simpler, more relevant ones. “Consumers told us they prefer a more streamlined range. Aldi, for instance, is often rated easiest to shop, even though it carries around 30 per cent of the SKUs of Coles or Woolworths. Less duplication creates space for innovation – whether that’s bold flavours to engage younger shoppers or nostalgic products to re-engage older ones.”
Rethinking range and relevance
For Gilding, this rationalisation should be seen as an opportunity, not a constraint. “If you remove duplication, you make room for new ideas to land. Retailers that really understand their shoppers by generation – and tailor their ranges accordingly – will win.”
He believes FMCG companies have become obsessed with variety for its own sake. “We’ve seen a fixation on offering choice rather than backing that choice with data. The current environment gives brands a chance to rethink and rebuild their ranges with evidence-based precision.”
That rethink is becoming urgent as the mid-market shrinks. “Mainstream brands sitting between value and premium are being squeezed. The cost-of-living crisis is driving shoppers to the value end, while the premium tier is doing fine. What’s left in the middle is starting to disappear,” Gilding says.
“When you overlay six generations of shoppers, the question becomes: which way will each group go? Younger consumers might lean towards value, while others hold onto premium experiences. The brands stuck in the middle need to decide — move up, move down, or risk disappearing altogether.”
Testing what works
Gilding believes agile testing is the missing piece in helping retailers and suppliers navigate this complexity. “It’s about segmenting the market, then using behavioural science to ask the right questions – without leading people toward the answers you expect. Every failed product launch can be traced back to a failure to listen.”
Agile product testing enables FMCG brands to identify which products resonate with specific generations, pinpoint gaps in cross-generational appeal, and adapt quickly. “The solution isn’t to pick one strategy for all six generations,” Gilding says. “It’s about having the insight and intelligence to know which approach will work for each, and validating that before you launch.”
This approach is already gaining traction with some of Australia’s largest retailers. Gilding points to Coles and Woolworths as examples of businesses beginning to tailor their communication and retail media strategies to different generational cohorts. “They’re learning to reach some audiences via catalogues and others through social commerce, even down to local store demographics,” he says.
Agile insights give retailers a competitive edge – helping them understand their shoppers more deeply and keep pace with shifting expectations that change every 12 months. Meanwhile, brands can use those insights to create stories and products that align with what each group actually wants, rather than what they wanted last year.
Listening beats predicting
For all the data and sophistication, Gilding says the principle remains simple: listen before you act. “If you want to create a product that’s successful tomorrow, you need to understand what people want today and tomorrow – not what they wanted yesterday.”
Arnott’s, he notes, offers a clear model for balancing heritage and relevance. “They’ve got Australia’s favourite biscuits, but they also keep launching innovations that appeal to younger consumers. For a 159-year-old brand, they’ve managed to stay current without losing their roots.”
As Australia’s six generations of shoppers diverge – in wealth, habits, and motivations – the brands that stay agile, data-literate and genuinely consumer-led will be the ones to hold their ground. “Retailers have one shelf, but six generations to serve,” says Gilding. “The ones who listen best will win.”
