Wednesday, March 26, 2014

Increasingly Food Consumers Migrating to Non-Traditional Channels


The rise of Ready-2-Eat and Heat-N-Eat fresh prepared food sales success has created a platform for food customer migration. When the University of Arizona’s Center for Retailing, completed a recent survey of more than 1,200 American consumers, Foodservice Solutions® Grocerant Guru™ was not surprised to learn that Non-Traditional channels continue to outperform.
The Study found that in the preceding 12 months, 77 percent of respondents bought groceries from “a non-grocer,” and 96 percent would consider doing so in the next 12 months—although it included Walmart and Target among “non-grocers.” Here is who else was on the list in the top ten of consumer choice:
1. Walgreens
2. CVS/ Caremark
3. Dollar General,
4.  Dollar Tree
5. 7 Eleven
6. Kmart
7 Costco
Millennials are a big reason for customer migration. The study found that 57 percent of Millennials are willing to do so, but only 40 percent of Gen X respondents and 36 percent of baby boomers. It also found that 47 percent of Millennials are willing to get groceries at a pharmacy, again leading Gen Xers (37 percent) and baby boomers (36 percent).

Ready-2-Eat and Heat-N-Eat fresh prepared food is common today at most convenience stores and is growing within the dollar store sector.  Millennials seemingly always in a hurry to get somewhere and do something while incorporating the act of discovery particularly in food will continue to fuel this migration into non-traditional channels. 
It is not surprising that legacy CPG canned/boxed goods are the most frequently purchased food items at non-grocery stores, by 59 percent of respondents. With the knowledge that 50% of the U.S. population over the age of 18 are single But the next most frequently purchased out-of-channel may be a little surprising: dairy (54 percent), bread (49 percent) and fresh produce (42 percent.  Most important Ready-2-Eat fresh prepared food in the form of a “snack” is consumed by 77% of consumers daily. The vast majority of are purchased at C-stores, QSR’s and increasingly Drug Stores.
Since 1991 www.FoodserviceSolutions.us  a Tacoma, WA based retail foodservice consultancy has been the global leader in the Grocerant niche. For product or brand positioning assistance contact: www.FoodserviceSolutions.us or Call: 253-759-7869 

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