Gen Y has marched into the marketplace and they've got money to burn. This generation might be young, but don't be deceived; they're some of the savviest consumers to date. Gen Y is hooked up to information through every channel available. They're always connected whether it be via Internet, iPod, cell phone, or Blackberry. And with any and everything they want literally at their fingertips, Gen Y has become the most demanding group in the marketplace today. They look for restaurants that have a cutting-edge approach, menus with a wide variety of options and high-quality food -- and they won't settle for less. They're also incredibly fickle. As soon as an exciting, novel place pops up on their computer screen, Gen Y has a new favorite restaurant. It's essential, then, that restaurants figure out how to catch and maintain the attention of Gen Y in order to capitalize on the next wave of consumers.

David Morrison, president of the young adult consulting firm TWENTYSOMETHING™ Inc., coined the term "brand surfing" to describe the tendency young consumers have of jumping from one product to the next rather than sticking with a single, reliable brand (as Baby Boomers are apt to do). According to Morrison, Brand Surfers find their roots in television: "Channel surfing has given rise to an explosive new consumer trend. By extension of their TV channel-flipping counterparts, Brand Surfers quickly switch from one new introduction to the next." The biggest challenge restaurants face today is overcoming that surfing tendency. Young consumers are drawn to a restaurant for a unique eating experience, so it's relatively easy to lead them to a new place. Garnering repeat business, however, is a different story.

With a new audience that changes its consumer tastes more quickly than it takes to download a podcast, restaurants must be willing to constantly adapt to emerging trends. "Restaurants need to stay on the edge of cutting edge," says Morrison. Not only must restaurants scramble to figure out what makes Gen Y tick, but they have to execute a careful balancing act, developing campaigns that will simultaneously appeal to Baby Boomers and Gen X as well.

Baby Boomers tend to stand apart as an established consumer group, but the line between Gen X and Gen Y is particularly hazy. According to the U.S. Census Bureau, Gen X includes anyone born between 1965 and 1984, and Gen Y consists of anyone born during and after 1985. Gen Xers and Yers both grew up on the Internet, MTV, and cell phones. They are tech savvy, eager to embrace new trends and tend to brand surf. So what sets X and Y apart? One of the most significant differences between the two groups is adaptability: "Gen Y expects the world to conform to them, while Gen X will adapt to their surroundings," says Morrison. While Gen X endured the hardships of recessions, corporate downsizing, and layoffs, everything has been accessible and affordable for Gen Y. Morrison describes Gen Y as the "Me, Too!" Generation: "They make the 'Me' Generation look selfless. No one says 'no' to them, and they expect to be catered to as adults."

Gen Y's high standards and fickle tastes are forcing companies to offer products that cater to an individual's needs. This trend is called customization, and it began when Apple leveraged the iPod, a revolutionary product consumers could program (and re-program) according to their whim. Gen Y and Gen X are looking for the same level of customization in restaurants. They want a menu with so many options that they can always expect to be satisfied, no matter what they crave.

A new wave of restaurants has honed in on this demand from young consumers, remarkably without excluding the Baby Boomer market. The nostalgic appeal of peanut butter sandwiches, hot dogs, burgers and shakes, or grilled cheese sandwiches transcend generational divides. Combine the universal appeal of these nostalgic foods with a fresh package and a wide selection and you've hit a veritable consumer jackpot in today's marketplace.

Meltdown, Etc., a high-quality fast-food restaurant in Culver City, offers customers more variations in grilled cheese sandwiches than would seem humanly possible. "I've never met one person who doesn't like a grilled cheese," explains the founder. Six years later, Meltdown is poised to become a national chain. Grilled cheese sandwiches spark nostalgia for the Good Old Days among the Boomer crowd, and the novelty of a wide variety of the same food type piques the interest of younger consumers.

There's no escaping Gen Y. They're here to stay, and they'll continue to look for the most innovative options available, moving beyond yesterday's favorite restaurant without a backward glance. "The trend of brand surfing knows no boundaries. Transcending endless product categories and demographic groups, it is the collective by-product of several fundamental shifts that will continue to shape consumer behavior well into the next millennium," says Morrison.

Gen Y is forcing companies to move beyond single brand concepts and to adopt a versatile identity that develops in tune with today's ever-changing competitive landscape. Morrison's advice for restaurants is to stay connected: "They need to do their homework, understand their customer base, and never become complacent." With a new group of consumers who are always poised to jump to the next trend, it's important to be able to move with them -- or, even better, to start the next wave.

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© 2007 California Restaurant Association
Abbreviated for length