Battle Brewing Between Fresh Food Fast Vs. Shelved Food Stocked

Where are we buying fresh prepared food?  Today, the evolving food consumer is driving restaurant, C-store, and grocery change specifically a renewed focus on ‘fresh’.  This new set of food preference including likes and dislikes is creating food retail discontinuity.  That discontinuity is driven by Generation Z, ages 0-23, and Millennials, ages 24-37, according to Foodservice Solutions® Grocerant Guru™.

The merger announced this week between Heinz and Kraft Foods creating the world’s fifth largest food company with sales of $28 billion says more about a growing generational food consumption divide, than the long term success for such brands as Jell-O or Maxwell House according to our Grocerant Guru™.

Regular readers of this blog know that Gen Z and Millennials are looking for food transparency.  They prefer food that is ‘fresh’ with fewer artificial ingredients, and perceived as better for you. Baby Boomers and Gen X aka older generations grew up counting calories, monitoring price and eating more at home than away from home. Simply put this is becoming a battle of Fresh Food Fast over Shelved Food Stocked. 

Incremental Change

Restaurants continue to garner share of wallet.  Morgan Stanley research found recently that Millennials go out to eat once a week or more 53% vs 43% for the general population.  Here is how they define the groups. QSR means a "quick-service restaurant," like McDonald's or Subway. CDR refers to casual-dining establishments like Olive Garden or Applebee's. And FCR stands for fast casual restaurants like Chipotle, Panera Bread, and Five Guys.

Fresh Fast Food

While Millennials are different from their parents there are some similarities one being they visit McDonalds but are unwilling to tell anyone one that they do. The Morgan Stanley report found that McDonalds is the most visited restaurant Millennials and yet least likely to receive an endorsement. 

NPD Groups Ms. Bonnie Riggs found that;   “Americans made 61 billion visits to restaurants last year. Three out of four visits were too fast food restaurants, like McDonald’s. Which reminds us that in the United States 50% of Americans over the age of 18 are single, and as our Grocerant Guru™ states they prefer Fresh Food Fast over Shelved Food Stocked. 

With all the talk of ‘fast casual’ dinning growth Millennials make up 51% of fast casual customers although they represent only 31% of the people surveyed by Morgan Stanley and the battle in the fast casual space is for Millennials dollars vs Millennials grocery dollars.  At this time Millennials are showing little appetite for Shelved Food Stocked. 

Millennials have become accustom too fresh prepared Ready-2-Eat and Heat-N-Eat food options that can be personalized and customized. They will be key to driving sales of fresh prepared food sales across all food platforms an additional 8.5% over the next three years according to Foodservice Solutions® team. 

They enjoy eating fresh fruit and fresh vegetables. More important they enjoy them all day, as a snack, or with a meal.  They are ‘hand held’ and ‘better for you’ foods that provide the instant gratification Gen Z and Millennials are seeking. That’s a perfect driver for the future growth of the Quick Service restaurant sector and the Fast Casual sector.

The Customer Has Moved

The simple fact that Trader Joe’s has the highest Sales Per Square Foot in the grocery sector and does not accept Slotting Fees and is largely dismissed by main-street grocery stores that say “O That’s Just Trader Joe’s”. The simple fact that Aldi is the fastest growing grocery store in the US and does not accept slotting fee’s  tells us that maybe just maybe the Heinz and Kraft Foods mega merger will be great for international growth but is very likely to do nothing for U.S. sales. 

Customer migration drove that Sales Per Square Foot at Trader Joe’s!  Consumers consider Trader Joe’s a value store not a specialty store.  Consumers are not wrong.  Consumer do prefer Fresh Food Fast over Shelved Food Stocked according to our own Grocerant Guru™

Visit: www.FoodserviceSolutions.us  if you are interested in learning how Foodservice Solutions® 5P’s of Food Marketing can edify your retail food brand while creating a platform for consumer convenient meal participation, differentiation and individualization or you can learn more at Linkedin.com/in/grocerant or twitter.com/grocerant or call 253-759-7869 Email: Steve@FoodserviceSolutions.us