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Driving Consumption

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India is home to a largely youthful population, which is also among the highest contributors in terms of consumption, which makes this segment an important target for food service players.

With 65% of its population under the age of 35, India is home to a largely youthful population whose median age is 26 years. This majority is also among the highest contributors in terms of consumption, spending as much as 15-20% of their wallet on eating out, which makes them an important target for any food service player.

’s research conducted across the top 24 cities and over 1,200 respondents, brought out some interesting insights on the consumption pattern of India’s urban youth. Notably, nearly 55-60% of this segment eats out once a week while 19-23% eats out 2-3 times a week. The occasion varies from social hangouts (for college students), business meetings (for professionals), exploring new restaurants, and spending time with family.

Frequency of eating out differs across this segment in accordance with their disposable incomes. Mimic beginners and newbie shopaholics largely focus on spending at hangouts with affordable price points (cafés, QSRs, casual dine). However, the responsibly spendthrift are likely to spend on premium formats as well as affordable dining.

The urban youth, being brand-conscious, prefers branded options while eating out. Entry of international players and the emergence of standalone and homegrown chains have contributed to a growing inclination for brands. However, the study revealed that price points and average spends play an important role in deciding the food service outlet. Essentially, affordable price points, along with a wide range of options, underscore the popularity of QSRs, cafés, and casual dine outlets.

Taking cognizance of this, food service operators have introduced value-for-money offers to allure price-sensitive youth and increase their market share and edge out the competition. ’s streetwise menu, launched at a starting price of Rs 25, targets this segment and specifi cally college students, while also projecting itself as a ‘hangout’ destination. McDonald’s Happy Price Menu and Subway’s Real Value Combos, which include beverages and chips, also aim at enticing the youth through affordable offerings. Pizza Hut’s Meal for 2, ’s lunch combo, Indijoe’s celebration combo in casual dine, and TGIF’s combo meal in the PBCL segment are other reasonably priced meals preferred by youngsters.

The study also highlights that the PBCL segment is preferred by the youth for relaxing or unwinding with colleagues and friends. Cafes and Lounges have also emerged, boasting a multi-cuisine menu, a variety of liquor offerings, and a youth-friendly ambience. Examples include Boombox Café, Out of the Box, Urban Café, Warehouse Café, etc.

Additionally, the widening presence of microbreweries such as Toit in Bangalore and Striker and Howzatt in Gurgaon, and entertainment cafés have redefi ned the PBCL segment as popular with the youth, driving the segment to evolve in tandem. In order to differentiate themselves and provide a unique proposition for their young patrons, food services players are including live bands, board games, comedy nights, etc. along with a good ambience and delectable food.

Also observed is the emergence of Italian and Chinese as the favored cuisines among the youth, followed by a preference for North Indian cuisine. The young consumer’s taste for these cuisines is rooted in their desire to experiment with different cuisines. QSRs and casual dine outlets enable them to try different cuisines as they have lower price points. Relatively newer cuisines like Mexican, Thai, and Japanese are also gaining popularity; however, such cuisines are largely limited to premium dine-in formats, which limit their consumption by the youth.

A large percentage of the youth is beginning to opt for healthy offerings; they are also keen to know the ingredients and preparation of the dishes. They prefer grilled over fried, fresh over pre-cooked, frozen yogurt over icecream, grain bread for sandwiches, and so on.

The youth is both tech-savvy and inquisitive about new trends, new brands, and new offerings. Brands are capitalizing on the active presence of this customer on their social media platforms like Facebook and Twitter by offering promotions, discounts and contests. , Hard Rock Café, Mocha, and Beer Café promote their events, shows, and latest offerings through social media and blogging platforms.

Domino’s has launched mobile applications and social media monitoring tools such as Radian 6 and Meltwater Buzz to monitor and analyze their target consumers and their preferences thereof. Such tools enable them to engage with these consumers and ensure brand visibility.

Food review websites like and Burrp, offer useful information about restaurants across cities, aiding consumers to making the right choice when deciding on a restaurant. As youngsters are increasingly becoming selective about the cuisine and ambience offered by a restaurant, they rely heavily on the feedback provided on such review websites. Another innovation is the introduction of online restaurant reservation services by Table Grabber, Book Your Table, and eat2eat. Apart from the ease of confi rming reservations at no extra cost, these providers also make available discount deals at various restaurants.

With the younger population is becoming brand-aware, is travelling more, and is keen to experiment, their consumption is expected to evolve further in terms of the quality, variety, and fusion of cuisines. Further, young entrepreneurs and professionals are seen as the driving force of the Indian economy. The concentration of purchasing power in younger hands and their increasing indulgence and spending on food, especially in formats like QSRs, cafés, and PBCLs, will continue to propel growth of the food service market. It is, therefore, essential that restaureteurs understand the psyche of today’s youth and implement their strategies accordingly if they want to capture burgeoning demand from this segment.