- According to a Bank of America note, a “millennial baby boom” could begin this year and sales of food and baby merchandise could be spurred.
- Retail analyst Robby Ohms said the trend could benefit grocers like Kroger, big-box players like Walmart and Target, and membership clubs like Costco.
- According to Nielsen data, one of the key indicators is the increased sales of pregnancy tests, which have increased significantly since June 2020.
A millennium-fueled baby boom appears on its way and could boost sales for retailers including Target, Walmart and Costco, according to a note published Tuesday by Bank of America.
New babies are being born. Pregnancy tests are selling at high rates. And more couples say they’re trying to have a baby, according to company research.
According to Equity Research analyst Robby Ohms, this could spell good news for grocers, big-box stores and warehouse clubs that sell diapers, strollers and other baby merchandise — or simply those located close to suburban homes where new parents may simply can. He predicted that the baby boom might start this year. Among the beneficiaries, he called out: Albertsons, Kroger, Dollar General and BJ’s Wholesale Club.
According to the US Census Bureau, Millennials have overtaken Baby Boomers to become the largest generation in the country. According to the Pew Research Center, the group — made up of about 72.1 million people — between the ages of 25 and 40.
One of the key indicators of a potential “Millennial Baby Boom” is increased sales of pregnancy tests. According to Nielsen data and Bank of America research, sales of pregnancy tests have grown an average of 13% year over year since June 2020. Since June 2020, sales of pregnancy tests have grown by an average of 13% year-on-year. This compares with an average of 2% year-over-year from 2016 to 2019.
If this happens, it would reverse the decline in births during the pandemic. According to Bank of America research, live births increased by 3.3% in June 2021, the highest level of growth seen since 2013.
In the company’s monthly survey, 11.3% of respondents said they or their partner is expecting or trying to have a baby within the next 12-month period. That survey was done in October with nearly 1,000 people. This marked an all-time high since Bank of America began the survey in December 2020.
Some retailers have already credited millennials — and their growth in marriages, kids and home shopping — for driving more sales. Best Buy said this generation has become the largest group of customers. Home improvement retailers Home Depot and Lowe’s have said that generational trends — not just pandemic-induced nests — are powering the companies’ strong sales.