Canadian Vending

Features Consumer Behaviour Trends
Dispensing Strategies: Echo Location

Echo Location


March 31, 2008
By Michelle Brisebois

Topics

Right now vending has a pretty robust business going with teenagers. In
spite of all the hoopla around healthy vending choices in schools,
there’s a huge percentage of the population residing there currently.

Right now vending has a pretty robust business going with teenagers. In spite of all the hoopla around healthy vending choices in schools, there’s a huge percentage of the population residing there currently.

In fact, 26 per cent of the Canadian population falls into the “Echo Boomer” cohort born between 1982 and 1995. That places many of this group currently in high school.

Chances are, the parents of Echo Boomers both worked, and neither had much time to cook. As a result, Echo Boomers – more than any other generation – view prepared food and instant service as a “have to have” not a “nice to have.” They avidly consume beverages, electronic media and are comfortable with technology. Vending and youth – it’s a match made in heaven.
It’s important for us to recognize that this group is large, valuable and about to change dramatically as they make their way out into the world. With so many of these consumers close to leaving school, it will no doubt have an impact on machines located in that

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sector. When the Echos have left the building – how do we follow?

Echo Boomers are the first generation raised by mothers who worked – dining on fast food was a common occurrence.

“These individuals tend to have a disproportionately high frequency of using restaurants,” says Hudson Riehle, vice-president of research and information services for the National Restaurant Association. “They’re the most likely of all age groups to view restaurants as an essential part of their lifestyle.”

Echo Boomers have never known a world without computers so new technology is a breeze for them to adopt. On the beverage side, Canadian vending industry sales data show that high school students purchase an average of 1.8 beverages per student per month from vending machines in secondary schools:  a captive audience receptive to vending. It’s a good thing.

There are, however, a few changes brewing that we should begin to plan for.

Elementary school enrolment is dropping across Canada, anywhere from six to 24 per cent, due to changing demographics. There just aren’t as many millennial kids (born post 1995) as there are Echo Boomers.

As Echo Boomers graduate from high school, they will scatter and that makes it harder to target them. We can look at post-secondary education trends and employment cues to identify a few key sectors they will likely gravitate towards.
For the first time in history, Canadian enrolment in universities surpassed the one million students mark (Statistics Canada Nov. 06). A competitive employment sector over the last 20 years has resulted in a tendency for Canadian parents to push the Echo Boomers into university rather than college or skilled trades.

Data reveals that Ontario’s current university enrolment is a robust 40 per cent higher than it was in 2000-01. The Council of Ontario Universities reported that applications continue to rise.

“The number of applicants exceeded projections, as they had in 2006 and 2005,” the council said.

However, noted economist David Foot, who wrote the best-seller Boom Bust and Echo, sees a far different shift coming for Canadian universities.

While a higher percentage of high school graduates have been opting for universities, Foot suggests the trend will also likely slow and may even begin to reverse. There is great concern over the void in skilled trades.

“Employers are increasingly demanding non-academic or more practical skills from newcomers, which will tend to press students leaving high school into apprenticeships and trades,” he said.

Governments are developing incentives for college applicants in hopes of taking the pressure off the university system. As we look at opportunities five to 10 years down the road, targeting trade schools and keeping an eye on the manufacturing sector for future growth would be wise. Colleges will most likely experience very strong growth as more of them are approved to offer degree programs and begin to compete with universities for students.

Operators need to look for ways to continue to nurture this segment.

We do know that once a cohort embraces a pattern of behaviour, they tend to continue that pattern throughout their lives. We’re seeing pizza consumption growing in the 55+ age group. This is new since pizza was not typically consumed by older people. However, the new crop of senior citizens consumed pizza in the ’70s and ’80s when they were younger and has continued this behaviour.

Today’s youth will likely take their penchant for bottled water and sports drinks with them as they move into their 20s. Make sure you continue to evaluate your product offering as Echo Boomers filter out into post-secondary settings and the workplace. You may need to transfer some of your successful products within the school system into post-secondary sectors.

On the other hand, once the Echo Boomers are adults, some of the government interference we’ve seen with vending at the school level will cease to be an issue. All of these kids will be able to choose for themselves.

David Foot describes the Baby Boomers as a rabbit swallowed by a python snake – a big bulge travelling through time. The Echo Boomers represent a smaller rabbit, but they are a bulge in the demographic continuum just the same. Echo Boomers are great consumers for the vending industry. We just need to make sure we move with them.o


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