Overall restaurant customer
migration is driven by the 65 Inch HDTV
Syndrome according to Foodservice Solutions®
Grocerant Guru Steven Johnson found that the line between restaurants and food retailers is growing ever thinner. The
fight for America's food dollars continues to intensify as consumers find fresh
prepared Ready-2-Eat and Heat-N-Eat fresh food options at a wide and growing
array of outlets across almost every channel; including convenience stores, chain drug stores, restaurants, Liquor stores, grocery stores,
club stores, vending and even more non-food retailers the ilk of Ikea.
While manufacturers, retailers and restaurants worry
about choice overload, consumers have embraced their new choices and show no
signs of returning to the old ways. This fight is taking place in what is
called the grocerant niche.
Foodservice Solutions® Grocerant Guru®
noted in 1991 that the restaurant industry is not an industry known for trying
to be first as in fastest to market with an ideation, food or technology
advance. In the United States the larger the chain in almost all cases the more
slowly they are to adopt something than a smaller chain or independent
restaurants will. Chain restaurants goal is simple feed one meal at a time in
the restaurant while protecting and edifying the brand.
Historically chain restaurant leaders have denied the credibility of
start-up competitors as non-relevant. The pizza sector is a great example;
evolving from family dinning independents to national chain of "Red
Roof" Italian, then to delivery only outlets and now take-N-bake is
garnering market share in the pizza
sector. (Note: Home Made Pizza Company and Papa
Murphy's are further
examples of take and bake pizza operators.)
Trends in the Food Industry Point to an Increase in
Non-Traditional Meal Occasions
Demands of work, economic shrinkage, demands of raising a family,
commuting, social interaction, kid's after-school activities, all contribute to
a food marketplace where convenience vies with price over legacy brands. Recent
advances in food packaging and new points of non-traditional food distribution
have empowered consumer choice, and Americans are embracing these choices even
as legacy marketers cringe. Who's after restaurant food dollars simply put everyone
and that means every retailer.
You better start paying attention. Why should you care if Walgreens is
selling fresh prepared Ready-2-Eat and Heat-N-Eat fresh food? Why should you
care if Whole Foods, Trader Joe's, Safeway and Wegmans are selling Ready-2-Eat
and or Heat-N-Eat fresh pizza? Why should you care if Coinstar is selling
Seattle Best Coffee at 1,000 locations for $1.00?
It’s quite simple. You should care because they are selling it, and you are
not! The fastest growing sector of retail food service for the past four years
has been the Convenience store sector. The C-store sectors growth in large part
has been driven by fresh prepared food. Non-traditional avenues of distribution
are growing, gobbling market share while establishing new patterns of
consumption, price points and customer loyalty.
Consumers are Driving Change Spurring New Retail Food
Formats
Trader Joe's and Whole Foods have created Ready-2-Eat and Heat-N-Eat fresh
prepared food items with qualitative differentiation as an entity with identity
that has help propel them into Grocerant niche Ready-2-Eat fresh prepared food
leadership. In fact recent research shows that both Trader Joe's and Whole
Foods are each known for high quality (restaurant quality) Ready-2-Eat and Heat-N-Eat
foods with distinctive offerings.
Even more important both Whole Foods and Trader Joe’s are leading with
innovative products and package size that create value and have positioned each
chain as a food shopping destination for meal FIVEcomponents customized and personalized for
immediate consumption or mix and
matched for a meal time at home. In short they are stealing your customers.
Walgreens fresh prepared
food is restaurant quality according recent consumer studies and priced less than Panera Bread or Corner
Bakery Cafe. Both Panera Bread and Corner Bakery Cafe thrive in urban
locations. Walgreens is now growing price, quality and speed of service
advantages over legacy retailers. Legacy restaurant chains must reconsider the
speed at which they evolve and adapt or non-traditional outlets will capture
profits margins as well.
More bad news is on the way for
legacy foodservice operators. Traditional views of meals and mealtime can
pretty much be discarded. Legacy retailers waiting for the "next big
thing" to copy simply might be out of luck this time. Legacy food
retailers may not like to be first movers very much but it may prove that
waiting too long will not work this time.
Foodservice Solutions® FIVE P’s are Driving Sales Success
Millennials continue to drive change as the retail food world is evolving
at an ever increasing pace filled with innovation in food, portion size, points
of distribution, and quality fresh prepared meal solutions. The price, value, service equilibrium is resetting in
retail foodservice. In order to edify your brand and reinforce consumer
relevance restauranteurs and other legacy foodservice operators should be
integrating Foodservice Solutions® FIVE P’s of Food Marketing.
Today, many food retailers continue to practice brand protectionism, stifle
the brand while diminishing consumer relevance. The consumer is dynamic not
static. Brands must be dynamic, evolving with the consumer. Four more years of
watching other retail sectors thrive should be long enough. Success in the
restaurant world is no longer simply about what happens within your four walls.
Steven
Johnson is the Grocerant Guru® at Tacoma, WA based www.FoodserviceSolutions.us with
extensive experience as a multi-unit operator, marketing brand/product
positioning expert, and Grocerant Niche development. Since 1991 Foodservice Solutions® of Tacoma, WA has been the global
leader in the Grocerant niche. For more
visit http://www.linkedin.com/in/grocerant
or twitter.com/grocerant Steve@FoodserviceSolutions.us
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