That’s right legacy grocery stores
have been hammering legacy food manufacturing companies for an answer to the
undercurrent of market share capitulation to Heat-N-Eat fresh prepared meal
kits that keep the consumer out of the grocery store. Once again legacy retailers simply don’t
want to evolve they want the customer to come back and just do what they always
have. Hint: that’s not happening.
Now Campbell Soup, Hershey, and Tyson
are eager try and maintain the status quo for the legacy retailers the ilk of
Walmart, Marsh, Publix, Kroger, and Albertsons.
They are going to put dinner in a box that can be put on a shelf. Now I ask regular readers of this blog, who
well do you think that will work?
The
first problem is Tyson Foods, Campbell Soup Co. and Hershey Co. are working with online couriers
to challenge meal-kit companies that ship parcels of ingredients and recipes to
consumers looking for an easier way to cook stir-fry or enchiladas at home. That’s right direct to consumer. Direct to
consumer does not help legacy grocery store a bit.
Once
again Plated, Blue Apron and HelloFresh, which source some ingredients directly
from local farms and sell proportioned fresh food. Have the advantage as
consumers want fresh according to Foodservice Solutions® Grocerant Guru® Steven
Johnson.
The
cost of fresh is nearly twice that of a CPG meal. NPD Group found that the cost of a fresh meal
kit is about $10 on average, while many consumers make dinner for an average of
$4 a person. However consumers like the
fact there is little or no wasted food and that the step by step instructions
allow them to cook a ‘restaurant’ quality meal at home according to our
Grocerant Guru®.
Cheryl
Bersin, manager of emerging technologies and e-commerce at ConAgra Foods stated “Sales at the grocery retailers that
generate about 85% of ConAgra’s sales have declined
for three consecutive years.…“We don’t want meal kits to continue to cut into
sales,”
A
Technomic study this year “showed 54% of consumers inclined to try meal kits
anticipated they would cut back on grocery-store spending.” Foodservice Solutions® team said the same thing
in 2015.Let’s
look at some examples of how yesterday’s CPG leaders are stumbling with today’s
playing field:
1.
Chef
Boyardee joined with Ahold USA’s online retailer Peapod to sell kits for
Buffalo chicken quinoa and zucchini noodle primavera. Both incorporate products
such as Hunt’s canned tomatoes that ConAgra normally sells at grocery stores.
2.
Hershey,
with startup Chef’d, in September launched dessert kits on Facebook Live, where
some food-preparation videos have attracted millions of views. In a Hershey
video, viewed roughly 850 times, executives are shown unpacking chocolate
chips, flour satchels and vanilla vials from an orange Chef’d box to bake
cookies.
3.
Tyson
Foods launched kits through Amazon Fresh in September, working its chicken and
beef into tacos, stews and roasts. Tyson sells a separate line of kits at some
grocery and convenience stores.
Fresh
is fast and growing companies the ilk of HelloFresh, Plated, Blue Apron, and
Munchery didn’t exist six years ago. Now, more than 150 companies compete in
the $1.5 billion U.S. market, says research firm Packaged Facts. Is your company Looking A Customer Ahead? Or are you looking
for yesterdays customer today?
www.FoodserviceSolutions.us is the global leader in grocerant niche
business development. We can help you
identify, quantify and qualify additional food retail segment
opportunities. Has your company had a
Grocerant ScoreCard completed? Want one? Call 253-759-7869 Email: Steve@FoodserviceSolutions.us
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