Wednesday, October 15, 2014

The 'Happy Meal' Moves Home


Foodservice Solutions® Grocerant Guru™ Steven Johnson introduced the notion of Ready-2-Eat and Heat-N-Eat meal assembly to the public back in 2009 and to his clients in 1991.  Since then we have look how fresh prepared meal components can make every meal a ‘happy meal’ at home.   So, how can restaurants, grocery delis, C-store, and drive meal component sales?  

Leverage on the classic traffic drivers for restaurants the Kids Eat FREE promotion. It used to be found mainly in family style restaurants such as the IHOPs and Denny’s of the world, but now as guest traffic is down across all categories, you see more and more types of restaurants running a Kids Eat Free promotion. The question is, "Does it work?" The easy answer is, yes it works to drive traffic, but the better question is, ‘Is it right for my retail food business?

Happy Meals Are Serious Business

Researchers at the North Carolina State University recently discovered, “time pressures, tradeoffs to save money and the burden of pleasing others make it difficult for mothers to enact the idealized vision of home-cooked meals advocated by foodies and public health officials.”.. it’s not just the kids who are griping, researchers said. “We rarely observed a meal in which at least one family member didn’t complain about the food they were served.”

Free is a very good price, and will always bring people in to get the free food. Look at the lines out the door each time a national chain has a free food giveaway promotion. The problem is, just getting people in the door no matter what it costs is not why you're in business. Sure you need customers, but you need to make a profit on those customers. Your ultimate job is to make money for yourself and your investors, not just drive guest counts. The same holds true at C-stores, Grocery stores, and new non-traditional fresh food retailers.

Ah the Catch

The typical Kids Eat Free promotion has some strings attached so you can be guaranteed to recoup your food costs. Some restaurants require the purchase of a kid’s beverage in order to receive the free meal. Others require the purchase of a regular priced adult meal in order to receive the free kid’s meals. These requirements protect you from going into a negative transaction territory where you're actually losing money on the deal. There's also often a limits on the number of children allowed per adult, usually 2 kids per adult meal purchased, so you don't get a busload of kids from the local camp and only sell one adult meal to their leader while you give away 27 kids meals.

A price based promotion like this does not build loyalty. It attracts customers who are price sensitive, and without the low price incentive to come in, they won't continue to keep coming. It's much like your coupon customers. If they have your coupon in hand this week they'll visit you, but if they have your competitor's coupon in hand next week, they'll visit them. Here is one example; a chain that offered Kids Eat Free on Saturday and Sunday nights, two very slow nights for this chain. While we promoted Kids Eat Free, guest counts grew quickly, but as soon as we took it away the counts went right back down to their previous levels. 
Cooking at home is Meal Assembly

Ready-2-Eat and Heat-N-Eat fresh prepared food today is widely available.  Consumers want a family meal that is a ‘happy meal’, cooking at home does not meal cooking from scratch it does mean meal assembly.  It’s OK for parents to buy meal components from multiple companies for one family meal.  By the way they do that now. 

So, the other factor to consider is the length of time you're willing to offer this promotion. Many retailers roll out the kid’s promotion as an immediate fix to low guest counts on a certain day or daypart. Once that fix starts working, the increase in guest counts is like a drug and you want more and more.

If it worked for Tuesday, let's also offer it on Thursday. And at some point you've devalued your product in your customer's eyes. Why should I pay $5 for this kid’s meal today when it's FREE tomorrow? And if you keep the promotion in place for any length of time, your customers grow to expect it. There may be a backlash of angry customers when you decide that it's time to stop offering the promotion. What is important today is Mix and Match meal component bundling with the Kid’s Eat Free promotion?

New Eating Occasions Require New Offers

So should you rollout a Kids Eat FREE promotion? If you do, go into it with a plan. Know what it costs you. Know how much growth you need to offset the food costs. Prepare a marketing plan because you have to tell the world about it, otherwise you're just giving away money to current customers. Utilize a Grocerant Scorecard, analyze you Mix and Match meal component offerings for customers to competitors so you understand your competitive advantage. 

Have an exit strategy. Offer it for the summer or a certain period of time, to keep customer expectations under control, create some urgency, and keep yourself out of the situation where customers expect to have their Kids Eat Free at your restaurant forever. Your goal is that your customers ‘happy meal’ becomes your Ready-2-Eat and Heat-N-Eat fresh prepared food success platform.


Invite Foodservice Solutions® to complete a grocerant program assessment, grocerant scorecard, brand, or product placement assistance.  Since 1991 www.FoodserviceSolutions.us  of Tacoma, WA has been the global leader in the Grocerant niche. Contact: Steve@FoodserviceSolutions.us or 253-759-7869  Linkedin.com/in/grocerant or twitter.com/grocerant

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