Local, sustainable new To-Go, Take-Out, and Take-Away fresh food options threaten restaurant growth. Companies the ilk of Buc-ee’s, Green Zebra Grocery, and Everytable are driving change. These new fresh food options are coming from unexpected non-traditional retailers. Many of these non-traditional food retailers are fast becoming the new normal in food retail. Do you know how The Home Meal Replacement fad of the 1980’s evolved into the Grocerant Niche and is today is now garnering restaurant customers and market share?
Harkin back in the day during the late Home Meal Replacement frenzy grocery stores, C-stores and restaurants all studied with excitement the successful developments of Phil Romano's Eatzi's. Eatzi's is Where Phil turned the page from restaurateur too foodservice retailer, and food merchant. Phil's experiment was a smashing success.
Eatzi’s was then and remains a concept that is consumer interactive, participatory with visceral authenticity recording sales of 17 Million a year at the original store. Today Eataly is Eatzi’s on steroids doing close to 60 Million a year in sales.
The Home Meal Replacement focus quickly faded away as grocery stores tried to make fresh prepared food a CPG product and in many cases they continue trying to do that today. Today the grocerant niche is the strategic path of choice for non-traditional fresh prepared food retailers, targeted at restaurant customers, profitable, and expanding at an ever increasing pace.
Fresh Food can be Omni-Channel
One example is Wawa, it was once considered a convenience store now the Wawa positions it's brand as Fresh First, Built-To Order and Ready-To-Go with focus of serving Fast Casual Food - To Go. At Wawa customers are now finding; What's for Breakfast, What's for Lunch, and now What's for Dinner.
Sheetz once a convenience store now calls themselves a restaurant that sells gas. Sheetz Made To Order food is a hit with customers. Sheetz is successful contemporizing legacy C-store products with differentiation, customization and personalizing.
McDonald’s learned from companies like Wawa and Sheetz that consumer like the variety, 24 hour menu serving all day parts - all day long - with a wide range of consumer meal and snacking needs. Breakfast 24 / 7 at McDonalds is proof positive success does leave clues. That’s right Sheetz is a Restaurant that just happens to sell Gas.
Rutter's is another convenience store in transition. Rutter's understands the unique balance between palate, price, pleasure, and the consumer's drive for qualitative distinctive differentiated new messaging and Rutter's is meeting that need set.
The food value proposition equilibrium for the consumer today balances; better for you, flavor, and traditional products all blended into something with a twist. In industry speak, differentiated does not mean different to the consumer it means familiar. Rutter's is an example of brand identity extending beyond consumer expectations within the traditional conveniences store sector. Too the consumer Rutter's is a direct valued competitor within the QSR space.
The grocerant niche is a result of the blurring of the line between restaurants, grocery stores, convenience stores, and drug stores all selling fresh prepared, portable convenient meal solutions. Targeted at the time-starved consumer with Ready-2-Eat or Heat-N-Eat fresh prepared food components that are "better for you", portable and portioned for one or two. All of these operators want a larger share of the retail food market. They want to take share from the restaurants.
Whole Foods is no longer Whole Paycheck but Whole Foods 365 Fresh Food Fast and consumers find that is "better for you". They are driving customer frequency while building loyalty with Fresh prepared Ready-2-Eat and Heat-N-Eat better for you food. Whole Foods focus is on convenient meal participation, better for you differentiation, and individualization.
Safeway's has integrated Mix and Match Meal Bundling marketing into daily and weekly iphone app's and legacy print flyers. With a focus on Fresh Prepared Food, Safeway is leveraging The 5 P's of Food Marketing: Product, Packaging, Placement, Portability and Price establishing contemporized consumer relevance. In what was once restaurant food space alone grocery stores, C-stores and Drug stores are now garnering consumer attention.
Duane Reade Fresh Food Is a Disruptive Force in the Retail Food Sector.
This video of Walgreens in San Francisco entering the fresh food space is evidence that no food retailer should dismiss as not my competitor. Walgreens with over 80 Billion in sales has the capital and resources to repeatedly try and try again until they get it right. Walgreens might just be The Next Biggest Competitor in the retail food space.
Duane Reade is part of Walgreens that has 8,177+ retail outlets. Who is selling what in your back yard? With Walgreens entering the fresh food area again with meats, wraps, soups "and other on-the-go meal options, as well as convenient alternatives for tonight's family meal, it is clear that the future of fresh food retail leadership may be up in the air.
Foodservice Steps Forward
Food Retailing never takes a step backward. Consumers are dynamic not static always looking to save both time and money. The new normal is the grocerant niche propelling new quality points of fresh food distribution and competitors that are well financed. Remember, when it is 4pm, do you know what your customers want to make for dinner ?
Steven Johnson is the Grocerant Guru® at Tacoma, WA based Foodservice Solutions®, with extensive experience as a multi-unit operator, consultant and brand/product positioning. Since 1991 Foodservice Solutions® of Tacoma, WA has been the global leader in the Grocerant niche for more Foodservice Solutions® visit The Grocerant on LinkedIn or @Grocerant on Twitter