Legacy Food CPG Brands Rewriting How Too Sell

Food companies are evolving slowly in search of consumers. Legacy companies that have established value for their brand and products have found sales slipping while brand recognition and brand value have not diminished.  Puzzled, they focused new research on the consumer and found “The Customer Has Move” both in preferred points of shopping and communication according to Foodservice Solutions® Grocerant Guru™.

In a new study Growth Strategies: Unlocking the Power of the Consumer,” by the Grocery Manufacturers Association found “more than 40% of CPG companies plan to sell products directly to consumers this year, finding direct-to-consumer effective for testing new products and growing their consumer base.” What do you think should restaurants sell meals direct to consumer?  Do with delivery?

Clearly when 40% of CPG Brands Plan to sell products direct-to-consumer by passing legacy points of distributions continued sector disruption is to be expected.  Today, digital channels and mobile are important in the direct-to-consumer process, and are rewriting the rules of retailing for CPG brands. The trick is finding the balance between legacy brand values and today’s consumer while providing innovative shopping experience can very well increase loyalty and profitability with customer relevance.

The new technology shortens the path to purchase. Users can easily go from watching a how-to video to finding a retailer who carries the featured product and making a purchase. Now, shoppable videos can translate into customer relevance, a referral tool, entertainment, and sales. Can C-stores and grocery stores leverage shoppable videos? Many do which do you like best? 

www.FoodserviceSolutions.us  specializes in outsourced business development. We can help you identify, quantify and qualify additional food retail segment opportunities or a brand leveraging integration strategy.  Foodservice Solutions of Tacoma WA is the global leader in the Grocerant niche since 1991

Take-Out Takes Off Technology Drives Disruption Once Again

Competition for customers heats up as home cooked meals go on-line for or sale. Chefs are now able to cook from home, sell meals, watch the kids, pay the bills all while cooking dinner for the family! Technology continues to ratchet-up the competition in the retail food space empowering chefs to build a reputation one customer at a time without the expense of opening a restaurant. Better yet business travelers can get a home cooked meal.

In Copenhagen there is a website that is turning private homes into Take-Out restaurants. It lets users advertise what they are cooking, when and for what price.  The site, Dinnersurfer.dk, is referred to as a restaurant version of the popular lodging site Airbnb, on which homeowners make their spare rooms or unoccupied dwellings available to paying lodgers for a fee.

Airbnb, is a big hit with consumers and Wall Street.  With its last round of funding Airbnb was valued at $ 10 Billion Dollars. There is no doubt Airbnb will enter the home cooking niche as well.

The advantages for consumers they in most cases pay less than if they had gone to a restaurant with the added benefit that many of the homemade dishes may be healthier than the greasy high calorie fare typically available at take-out counters.

Ana Teresa Salas, a 32-year-old consultant from Copenhagen offers meals on Dinnersufer.dk and said
"Sometimes I only put one serving up for sale, sometimes up to 20. It depends on what I'm making and how much time I have," …"It sounded exciting. I make food for my family every day anyway, and I always make too much," said Salas, who sells her food on the website two to three times a week.”

"On weekdays I try to make food that's healthy, without too much starch and fat," she added…"When I make healthy dishes it's mostly women, and when it's pasta and so on it's mostly men," she said.

The retail food space is evolving fast.  Drug stores, Liquor stores, Home Chef’s, and internet star-ups are all targeting the Ready-2-Eat and Heat-N-Eat fresh prepared food space.  Airbnb, JustEat, and a plethora of others are creating new points of distribution.  Is your company asking the right questions when developing your five year plan? Do you need out-side eyes?

 
For international corporate presentations, educational forums, or keynotes contact: Steve@FoodserviceSolutions.us  Grocerant Guru at Tacoma, WA based Foodservice Solutions.  His extensive experience as a multi-unit restaurant operator, consultant, brand / product positioning expert and public speaking will leave success clues for all. www.FoodserviceSolutions.us

Fresh Prepared Food, High Technology, Fast Service and Walmart

What’s for lunch when you are hungry and in a hurry? Are you on your way home and need something quick for a family dinner?  At the intersection of Ready-2-Eat or Heat-N-Eat fresh prepared food, mobile technology and the world’s largest food retailer you can find the answer it just might be Walmart.

We all know the Walmart Supercenters, Walmart’s Neighborhood Market the Grocery store now Walmart is expanding the classic Spoke-N-Hub retail template into convenience stores completing the circle, becoming closer to customers with a new convenience store concept called Walmart To Go.

Customers don’t like getting trapped the large footprint supercenters shopping when they only need one or two items.  They don’t like getting trapped in a grocery store just for one or two meal components are needed to complete the family dinner.

Trapped no more while Walmart To Go opened a month ago. Just this week we learned that Walmart To Go  has an ordering app that is food-service focused. “The free system enables customers to order and pay for their meal ahead of time for a speedy pick-up, a definite boon at lunch. Or they can grab dinner while stocking up on groceries and doing a fill-in shop until the next time they can hit a full-sized Walmart”

One of the hallmarks of the grocerant niche is bundling meal components into a customized family meal.  Here are some of the choices found on the app by Peter Romeo:

“Gourmet Hot Dogs, today’s special, a platter of dry-rubbed and smoked pork ribs, be more satisfying? “We recommend the ribs dinner,” says the app I’m using, which notes the price is only $6.47, and that includes two sides.” I have a choice of nine, ranging from Baked Potato Casserole to Crab Salad. I can try any or all of the others for an extra $1.29 each. Then again, I could always pop for the pizza, a steal at $3.49 for a 7-inch pie.”

Extending Walmart’s brand into a complete Spoke-N-Hub template increases fresh prepared food retails competitiveness. While industry elites chide my notion that Walmart will become a key player within the Grocerant niche; I remind them they chided my notion that they would become the largest food retail in the U.S. as well.  With a focus on branded food, quality fresh food, and price; Walmart will again reset the Price + Service + Quality = Equilibrium once again.

www.FoodserviceSolutions.us  specializes in outsourced business development. We can help you identify, quantify and qualify additional food retail segment opportunities or a brand leveraging integration strategy.  Foodservice Solutions of Tacoma WA is the global leader in the Grocerant niche since 1991

McDonald’s Quality Differentiation Will Win Breakfast Battle

The battle for consumers in 2014 is not a battle over breakfast but a battle over share of stomach. While breakfast is the current focal point. QSR leaders all must be mindful of the expanding success of fresh prepared food in both grocery stores and convenience store sectors. 

Taco Bells facile TV advertising can’t hide the fact that McDonald’s average sales volume per store is $1 million higher than the average for Taco Bell.  Simply put the reported $50 million dollar advertising campaign Taco Bell launched cannot be sustained. Then what?

The campaign may drive trial, for Taco Bell but will not diminish the brand value of the Egg McMuffin or McGriddle both unique category leaders copied by many, mastered by few. Taco Bell Franchisee's must be mindful trial is not adoption. For Taco Bell the cost of the big breakfast roll-out will come in months 4 through 12. 

McDonald’s is expected to have completed the roll-out of new “high density kitchen tables” increasing throughput by mid July 2014. Once the “high density kitchens tables” are in place look for McDonald’s to begin serving many breakfast items all day long.  Once again stifling Taco Bell and creating additional points of distribution for breakfast items that Grocery Deli’s and Convenience stores are not equipped to deal with in fresh prepared food. 

Remember breakfast is a hot category, Americans made 12.5 billion restaurant visits for breakfast last year, making the morning meal the only daypart showing traffic growth for the third consecutive year, according to NPD Group. In-addition with beef prices on the rise, breakfast offered all day long creates a platform for increased consumer choice creating both calorie and pricing flexibility.

www.FoodserviceSolutions.us  specializes in outsourced business development. We can help you identify, quantify and qualify additional food retail segment opportunities or a brand leveraging integration strategy.  Foodservice Solutions of Tacoma WA is the global leader in the Grocerant niche since 1991

Trader Joe’s Great Brand Positioning Drives Sales

When the United States Census Bureau first released numbers that showed in the United States, that of citizens that are 18 years old or older a full 50% are single, no one at Trader Joe’s was surprised. Trader Joe’s does it homework, understands consumers and what they want.  Trader Joe’s had researched consumer and did not want to sell 14 chicken breasts or 14 pork chops to a single person.  They knew single consumers of which 50% are they did not want 14 chicken breast!

Trader Joe’s was first considered a quirky unique store with personality but not much of a threat to legacy food retailers by industry insiders and grocery trade magazines. Trader Joe’s today has turned into a juggernaut. Food industry researcher Package Facts say’s that Trader Joe’s sales per square foot are $1,723  Whole Foods comes in at $973 per square foot compared to and industry average of $521. 

Leading the industry in sales per square foot at $ 1,723 is remarkable considering that they have only around 400 units and are not-quite a national chain yet either. Trader Joe’s success comes from solid brand positioning and is done without loyalty cards or TV Advertising.  Regular readers of this blog know we think loyalty cards are nothing more than a crutch for poor brand positioning.

When Foodservice Solutions® team conducted a recent survey they found that in-store shoppers were evenly divided between single and married shoppers at Trader Joe’s.  Additionally we found that the in-store shoppers were equally divided by age those over 50 and under 50 years of age. The one universal commonality no one was looking for 14 Pork Chops.

Trader Joe’s like it sister company Aldi stocks the store mostly with private label (Trader Joe’s) branded product.  Only about 5% of the products in-store are branded products from other companies. One trend that is clear is consumer like Trader Joe’s small packed servings size of both Ready-2-Eat and Heat-N-Eat food.

Consumers when questioned think that Trader Joe’s labeled products are Branded Products. Consumers do not consider them private label products. With sales over two times the industry average per store clearly as a brand Trader Joe’s is a success clue.

Interested in learning how the 5P’s of Food Marketing can edify your retail food brand while creating a platform for consumer convenient meal participation, differentiation and individualization contact us via Email us at: grocerant@q.com or visit Facebook.com/Steven Johnson, Linkedin.com/in/grocerant or twitter.com/grocerant

Are Restaurant Customers Migrating to 7 Eleven?

7 Eleven is given retail chicken companies an old fashion licking.  As KFC struggles to find a way to rekindle it’s brand magic and garner back even a little  market share, Popeye’s and 7 Eleven do not have that problem.  Over the course of the past five years 7 Eleven has aggressively tested, launched, and found success with both Ready-2-Eat or Heat-N-Eat food.

It looks as if 7 Elevens has found a new winning grocerant niche Ready-2-Eat product with its new Chicken Dippers. Chicken Dippers are100% White Meat Pieces perfect for most any day-part from lunch, dinner, or snack.  With over 50,675+ global retail outlets 7 Eleven customers have embraced its Ready-2-Eat chicken from its Chicken Breast Tenders, Chicken Wings, and now Chicken Dippers.

7 Eleven “Chicken Dippers are pieces of 100-percent, high-quality white-meat chicken with no fillers that are lightly breaded in a tasty coating and served with a choice of Ancho Chipotle, Ranch or Honey Mustard dipping sauce. A cup-holder in the specially designed Dippers packaging helps keeps the sauce from spilling. Six "dippers" and sauce are value-priced at $1.99 at participating 7-Eleven^® stores.”

In the United States  Chicken Dippers are part of 7-Eleven's proprietary hot-to-go foods currently available in more than 5,200 of 7-Eleven's 7,800 U.S. stores. They are heated in Turbo Chef ovens, just like the company's whole and slice pizza, chicken tenders, chicken wings, mozzarella sticks and mini tacos.

Kelly Buckley, 7-Eleven vice president of Fresh Food Innovation "The Chicken Dippers proved so popular during limited-time in-store tests that store operators asked to keep them at the conclusion of the trial period," We asked are restaurant customers migrating to 7 Eleven?

"Millennials don't observe a three-meal-a-day schedule, but rather consume a mix of meals, snacks and mini-meals throughout the day as does the generation behind them," Buckley said. "They are busy as kids, and life has gotten no less hectic for them as adults. Kids, teens and 20-somethings are the biggest snackers.  Our menu has been evolving to include higher quality, value-priced smaller portions, mini-sizes and snacks that appeal not only to Millennials, but also kids and women as well." Chicken is viewed as a “better for you” product by both Teen and Millennials. 

www.FoodserviceSolutions.us  specializes in outsourced business development. We can help you identify, quantify and qualify additional food retail segment opportunities or a brand leveraging integration strategy.  Foodservice Solutions of Tacoma WA is the global leader in the Grocerant niche since 1991

Aldi Differentiation with a Twist.

At Aldi high quality for less time and money works garnering customers daily.  Publix, Safeway, Marsh, Fairway, and Smith Supermarkets once the mainstay of the American Grocery store shoppers are finding one relatively new competitor that may change how and where consumers shop for groceries. Aldi is the company, currently with 1,300+ grocery stores in 32 states announced plans to open 650 new units over the next five years.

Aldi brand model has consumer relevance with a heavy focus on Freshness, Food Quality, and Price.  In fact Aldi is forcing legacy grocery stores to rethink their outdated model. Aldi is creating the undercurrents of change within the industry.  These changes are the most dramatic since the 1940’s according to leading industry analysts.

Industry research firm Packaged Facts found that "Today the threat is spread out among all retail channels, including drugstores, dollar stores, limited assortment chains, and — the elephant in the room — e-commerce."  Foodservice Solutions® Grocerant Guru™ believes that “Aldi may just be the elephant in the room that all U.S. grocery stores should fear.”

Foodservice Solutions® asked Why Aldi here is what we found:

1.       Streamline Shopping Experience Aldi keeps prices low by offering a fewer branded items, in fact they carry just 5% of the inventory of a traditional grocery store requiring less space, creating a platform a “quick-trip” in and out.

2.       Private Label Food Aldi’s “house brand” food products are rated by consumers as meeting national brands or exceeding them in both taste and quality.

3.       “Delight Index” Market Force Information a leading industry research firm places Aldi high on its “Delight Index” with companies the ilk of Trader Joes, and Whole Foods.

While consumers are shopping for Ready-2-Eat and Heat-N-Eat fresh prepared food across multiple channels Aldi has found a way edify the consumer shopping experience, save time, money and add freshness into its service.  Aldi understands that differentiation does not mean different in food retail, it means familiar, but with a twist.  Aldi has the right twist for continued success.

Interested in learning how the 5P’s of Food Marketing can edify your retail food brand while creating a platform for consumer convenient meal participation, differentiation and individualization contact us via Email us at: grocerant@q.com or visit Facebook.com/Steven Johnson, Linkedin.com/in/grocerant or twitter.com/grocerant