Restaurant and Convenience Stores Consumers Visits Declining

 

The consumer is telling us the cost of everything can’t keep going up.  Consumers are cutting back on visits to their favorite restaurants and convenience store.  If you are a retailer that means less money, in the till, less profit in the back at the end of the month.  The questions Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions® continues to ask is; How are you going to get those customer visits back? How long are you going to wait before you try to get them back? 

Those lost customers are not eating less they are simply eating somewhere else according to Johnson. In a new survey released by NACS revealed that over the past three months, 59% of retailers said their customer traffic has decreased in stores, likely in large part due to high gas prices.

Regular readers of this blog know that convenience stores, which sell an estimated 80% of the fuel purchased in the U.S., rely on in-store sales, not fuel sales, to drive profits. But high gas prices are hurting customer traffic in stores and basket size: Nearly half of all retailers (49%) also say that those customers coming inside the store are buying less compared to three months ago when gas prices were $1.50 a gallon lower.

Retailer in that study also expressed concerns that elevated gas prices could also depress sales over the traditionally busy summer-drive season: 53% say they expect sales to be lower this summer than last summer, with only 25% anticipating increased sales.

So, we also consumers are more willing to cut out visits to restaurants and bars as a result of inflation than they are to take other steps to cut the cost of their regular food bill, according to data from a new survey released on Tuesday.

Just look at some more facts, 80% of U.S. consumers said they are eating out less often as a result of inflation, according to a Morning Consult survey. And about three-quarters said they are going out to bars less often.

Now consider this, 72% said they were purchasing less meat and 68% said they were buying less alcohol, according to the survey. Overall, more than half of U.S. adults said they have changed their eating and drinking habits because of inflation.

Yet there is more, According to Placer.ai, visits to full-service restaurants have fallen dramatically in recent weeks while quick-service visits continued to grow, which the data firm suggested could be due to a “trade down” from more expensive restaurants to lower priced options.

The Consumer Price Index rose 1% in May from April, and 8.6% over the past year. Retail food prices are up nearly 12% over the past year and prices on many basics have taken off: Gas is up by 50% over the past year while energy prices are up nearly 35%.

The higher prices are squeezing ordinary Americans even as wages rise, raising concerns that consumers could cut back and help throw the economy into a recession.

Restaurant menu prices are not rising nearly as much as retail food prices, which help to backstop demand—food-away-from-home prices were up 7.4% annually last month, though prices at full-service restaurants rose 9%.

Ninety-three percent of economists said inflation has peaked, according to a survey earlier this month by SIFMA, a trade association representing investment bankers and asset managers. But 78% of economists said there is at least a 15% chance that the economy faces “structurally higher inflation” for three years or more.

And 80% of economists said there is a bigger risk of “stagflation,” a combination of economic stagnation and strong inflation. According to Morning Consult, lower-income consumers have been more likely to say they have made adjustments. The survey found that those with children under 18 at home and those with household incomes less than $50,000 have been more likely to make spending adjustments than others.

Women were 13 points more likely to say that they have adapted to rising inflation. Women were more likely to identify themselves as the primary grocery shopper. How are you avoiding losing customers this year?  Are you tracking your year over year customer counts?

Don’t over reach. Are you ready for some fresh ideations? Do your food marketing ideations look more like yesterday than tomorrow? Interested in learning how Foodservice Solutions® can edify your retail food brand while creating a platform for consumer convenient meal participation, differentiation and individualization?  Email us at: Steve@FoodserviceSolutions.us or visit us on our social media sites by clicking the following links: Facebook,  LinkedIn, or Twitter

Gen Z Forcing Food Marketers to Shift Spending

 

Consumers are dynamic not static.  In 2022 there is no doubt that food marketers that want to reach their primary and secondary target customers are forced to shift how and where they spend their marketing dollars in order to garner the best results according to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.

Another new research report sheds light on the evolving consumer from the Path to Purchase Institute (P2PI) reveals that when it comes to social commerce, Instagram takes the top spot among Generation Z.

So, according to the 2022 Path to Purchase Institute Gen Z Shopping Habits research study, 38 percent of Gen Z rank Instagram as their preferred platform for making in-app purchases. In addition to citing Instagram as the social platform that they engage with daily, the cohort called out the app's ability to make personal recommendations and confidence that the platform protects their identity.

Of note was the fact that , TikTok and Facebook tied for second place for in-app purchases, both at 22 percent.

Jessie Dowd, editorial director, Path to Purchase Institute, stated, ''Digitally savvy Gen Z, born approximately from 1997-2006, has come of age, boasting strong voices, unique behaviors and sought-after purchasing power," … "Our report offers insights to help brands and retailers understand Gen Z behaviors from the way they search, browse and shop across channels and platforms to what’s influencing their purchasing decisions."

P2PI research revealed that the Gen Z consumer is truly an omnichannel shopper, fluidly browsing and buying both online and offline. Fifty-one percent of respondents reported that they shop mostly in-store for everyday items, while 27 percent preferred online shopping.

The impact social media has on purchasing everyday items is greatly influenced by what Gen Z sees their personal social circle doing. The activity of friends, family, classmates, and co-workers influences purchases for 75 percent of respondents. Other influences highlighted include:

·         Retailer or brand social activity (64 percent), with 18- to 24-year-olds (67 percent) more influenced than 16- to 17-year-olds (51 percent); and

·         Micro-influencers or celebrities have an overall impact at 42 percent to 47, especially among Hispanic or Black Gen Z shoppers, respectively.

Gen Zers are also engaged shoppers. The cohort is drawn to in-store options that are affordable and offer a one-stop shopping experience, referencing Walmart (49 percent) and Target (19 percent) as its favorite destinations for in-store shopping for everyday items. Consumers noted that this is due to having everything they need and a wide selection at an affordable price. 

The desire for one-stop shopping is still a Gen Z priority online as is affordability. The report cited that:

·         Sixty-two percent of these consumers identified Amazon as their favorite destination for online shopping, with 31 percent noting that Amazon has everything they need; and

·         Thirteen percent of respondents preferred Walmart for online shopping, with 37 percent noting affordability as a driving factor.

Building a Larger Share of Stomach

Is a Dynamic Process

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Whether in-store or online, Gen Z is also enticed by good deals. Ninety-one percent of respondents identify promotions and sales as impactful, while customer reviews or testimonials, personalized offers, and informative content specific to products all ranked at 88 percent effective.

When it comes to leveraging technology, Gen Z shoppers primarily started their searches with Amazon (52 percent) while 43 percent used Google. The cohort also uses retailer websites (28 percent) and TikTok (16 percent) in their searches.

Additionally, social media supports about 50 percent of respondents' browsing habits with Instagram and TikTok being the most popular at more than 60 percent.

Despite their tech-savvy scrolling, P2PI found there is minimal interest from Gen Z respondents around non-fungible tokens (NFT). Only 8 percent have purchased an NFT before and 31 percent say they are not at all interested in purchasing NFTs. More than one-third of the female respondents didn't know what an NFT was.

Success does leave clues. One clue that time and time again continues to resurface is “the consumer is dynamic not static”.  Regular readers of this blog know that is the common refrain of Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.  Our Grocerant Guru® can help your company edify your brand with relevance.  Call 253-759-7869 for more information. 

Is the Metaverse Just Play-Doh for Food Retailers

 

Where are you selling food today?  Just this month retailer after retailer seems to be experimenting with a new format, platform, delivery type, or menu item that ‘travels well’, according to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.

These days, even the most regional restaurant chains are investing in new store prototypes with smaller dining rooms and increased focus on drive-thru’s and digital orders. To keep up with consumer demand, the most tech-forward brands are coming up with even flashier, digital-forward store designs, like Taco Bell’s newly announced ‘Defy’ four lane-drive thru design.

Just consider some of what you have read about this month on this blog alone. The restaurant industry observed several new digital technology-focused store prototypes being announced, including at Taco Bell and Panera.

Yes, robots are again taking up space in the restaurant industry, with Grubhub bringing delivery bots to college campuses and Chick-fil-A investing in AI. Also, the latest food brand to dive into the metaverse is Kraft, which filed trademarks for NFTs and a future digital restaurant. Is the Metaverse a true platform or is it a place where kids will play, and retailers compete for young eyeballs?  How long will it be before you see a return on a investments in the Metaverse? 

Once again Tech Tracker rounds up what’s happening in the technology sector of the restaurant industry, including news from restaurants, vendors, digital platforms, and third-party delivery companies. Here’s a breakdown of what you need to know and why:

Kraft enters the metaverse

Kraft became the latest — and one of the largest — food companies to enter the metaverse by filing trademark applications for its brands Kraft, Jell-o, Kool-Aid, Velveeta, Lunchables, Oscar Meyer, and Philadelphia. Like almost every other brand before it, Kraft has not made any official announcement of plans for its digital presence, but the trademark includes NFTs, and virtual restaurants, food and drinks. Kraft isn’t the only restaurant to make the digital dive: Tony Roma’s applied for NFT trademarks in the metaverse last month.

Panera and Taco Bell launch digital tech-forward store formats

Panera Bread and Taco Bell have both been tech pioneers in the restaurant industry and now both brands are pushing the boundaries of tech-forward store prototypes.

Taco Bell’s new store offering will be known as “Defy” and opened in Brooklyn Park, Minn. this month with four drive-thru lanes and a host of digital tech conveniences like digital check-in screens that let customers place orders via QR code and get their food delivered by a contactless proprietary lift system, while two-way audio and video features will allow customers to chat with employees throughout the touchless process.

While Panera Bread’s new Panera To Go unit with no seating is not nearly as flashy as Taco Bell, it’s worth noting that Panera has been pushing the boundaries of contactless technology since the pandemic began. Panera to Go follows the announcement of contactless dine-in service, and has both a drive-thru and a pickup area for guests and delivery drivers.

Chick-fil-A now has delivery robots

Chick-fil-A is the latest quick-service restaurant to dabble in AI technology. The chicken chain is partnering with Refraction AI to test autonomous delivery at two locations in Austin, Texas (which is proving to be the hotbed of autonomous delivery and drone tests).

This self-driving robot drives either in the bike lane or shoulder of the road and is designed to complete last-mile deliveries without pressing further labor needs.

“The platform will allow us to provide fast, high quality, and cost-effective meal delivery within a mile radius of our restaurant all while helping to keep the community we serve environmentally clean and safe,” Chick-fil-A franchisee Luke Steigmeyer said about the service being tested at his restaurant.

Grubhub brings autonomous delivery to college campuses

Speaking of delivery robots, Grubhub is investing in AI and bringing bots to college campuses nationally this fall in partnership with Cartken. The pilot was tested in partnership with Ohio State University this spring and will now be rolled out to 250 college campuses when students return from summer break.

"We're thrilled to be working with Grubhub to delight students and campus staff with robot delivery," Christian Bersch, CEO of Cartken said in a statement. "This collaboration perfectly aligns with our mission to use robotics and AI technology to provide friction-free and environmentally sustainable delivery, and have robots serve the community.”

Lunchbox acquires digital ordering provider NovaDine

Tech trailblazer Lunchbox has entered the acquisition space for a second time with the announcement that the company has agreed to acquire NovaDine, which offers an end-to-end digital ordering solution. NovaDine’s roster of restaurant partners includes Firehouse Subs, Torchy's Tacos, Taco Bueno, and Steak & Shake—which have now been added to Lunchbox’s list of partners.   

This announcement comes on the heels of Lunchbox’s acquisition of online marketplace, Spread. With these acquisitions, Lunchbox cements its goal of becoming the go-to end-to-end tech solution.

"Traditionally, restaurants have faced the enormous hurdle of having to choose between multiple different technology tools to run their businesses, understand their digital clients and scale operations,” Lunchbox CEO Nabeel Alamgir said in a statement. “NovaDine has built an entire platform that enables the operator to manage all digital orders from a single operating system.”

DoorDash adds Yelp-like review features

DoorDash has been busy over the past month, with the finalization of food delivery company Wolt’s acquisition, and the announcement that the company would launch and curate in-app reviews, much like Yelp, to expand its algorithm to customer recommendations.

DoorDash now offers customers lists of top-rated restaurants in their neighborhood, with features including written reviews and most liked items, to end the customer tendency of endless, aimless scrolling through the DoorDash app.

DoorDash is the last of the “big three” delivery companies to add written reviews, but the first to include curated top 10 lists for customers based on cuisine, location, etc.

Square launches mobile POS capabilities

POS systems are making the upgrade as operators demand for more capabilities on handheld devices, as opposed to traditional POS systems. Square announced last month a new capability: Square for Restaurants mobile POS, which allows servers to take orders and payments through the device in their pockets. The two devices Square will be using are Square Terminal and the upcoming Restaurant Mobile POS kit, which will be released this fall.

Features of these new devices include order flow management from kitchen to table, route tickets, connections to loyalty programs and integration with OpenTable.

BentoBox now does payments  

BentoBox joins the throng of tech companies racing to add features and become an “all in one” tech solution: the all-new BentoBox Payments is in partnership with Clover and allows employees to take orders, process payments and manage them all in one platform.

“Restaurants don’t have the time or resources to balance countless dashboards and partners. Instead, they need simple, unified solutions that enable them to reach their customers on their terms,” Krystle Mobayeni, cofounder of BentoBox and head of restaurants at Fiserv said in a statement. “We’re meeting this need and bringing restaurants a customizable platform that improves front- and back-of-house operations and delivers an exceptional digital experience for diners.”

 Foodservice Solutions® specializes in outsourced business development. We can help you identify, quantify and qualify additional food retail segment opportunities or a new menu product segment and brand and menu integration strategy.  Foodservice Solutions® of Tacoma WA is the global leader in the Grocerant niche visit us on our social media sites by clicking one of the following links: Facebook,  LinkedIn, or Twitter

FriendShip Food Stores, Exploit Chicken, Pizza, and the Roller Grill for Growth

 

In 2022 once again garnering new customers is and art and those food retailers that focus on Ready-2-Eat and Heat-N-Eat fresh prepared grocerant niche fresh food will have a distinct advantage according to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®. 

FriendShip Food Stores, Kirk Matthews, vice president foodservice and marketing, stated, “We are chicken-centric, and tenders are the drivers, making up 80% of our chicken sales,” Matthews explained. “At an ounce-and-a-half in weight, twice the size of our competitors’ tenders, ours are an exceptional value.”

Ready-2-Eat the Double hand-breaded for extra crunch, cooked in small batches and always hot and fresh, chicken is “the champion” in the foodservice category at FriendShip Food Stores. The proprietary program, which is available in 21 of the company’s 30 Ohio stores, was launched about four years ago and sales have grown substantially every year.

So, it was during COVID, that FriendShip introduced chicken bundles and family meals. Since then, the stores are running targeted promotions such as snack boxes for lunch and bigger take-home packs after 5 p.m. (“Feed a family of four with chicken, dinner rolls and sides for $10.99.”)

Families want more than just chicken, so FriendShip has also been successful expanding its foodservice offering with its proprietary pizza program, which like the chicken, has been available for about four years. The signature crust features a savory blend of garlic and other spices and in addition to the traditional toppings, the stores offer buffalo chicken, chicken bacon ranch varieties and a breakfast pizza with sausage gravy.

On the run or for the whole family, FriendShip offers slices, which are priced at $2.99 for one and $5 for two, are the best sellers, FriendShip is making a strong effort to sell more whole pies, according to Matthews. To drive trial and demonstrate value, the stores offer discounted prices on whole pies on weekends, on special days such as Tax Day and Father’s Day and through the company’s loyalty program.   

I want you to understand that giving customers what they want is not exploiting them.  It is the art of grocerant niche Ready-2-Eat and Heat-N-Eat fresh prepared food.

Foodservice Solutions® team is here to help you drive top line sales and bottom-line profits. Are you looking a customer ahead? Does your messaging look more like yesterday that tomorrow?  Visit GrocerantGuru.com for more information or contact: Steve@FoodserviceSolutions.us Remember success does leave clues and we just may the clue you need to propel your continued success.

Summer is Here it’s time for a Free Slurpee

 

Once again, the weather has warmed up and 7-Eleven is planning an extra-large celebration for its 95th birthday on July 11, aka 7/11. For the first time ever, 7-Eleven will hold Slurpee Day at all 7-Eleven, Speedway and Stripes stores and give customers 11 days to redeem their free small Slurpee drink. The Grocerant Guru® thinks this will be the best promo for 7-Eleven this year.

Starting on July 1, a coupon for one free small Slurpee drink will be loaded onto the accounts of 7Rewards and Speedy Rewards loyalty program members. The free Slurpee offer can be redeemed in-store from July 1 through July 11, making it the ultimate birthday party favor.

Just in case one is not enough, the celebration continues from there as customers can stop by any 7-Eleven, Speedway and Stripes convenience store to take advantage of a special discount deal. Slurpee drinks are available for just $1 in-store and via 7NOW delivery all summer long.

So, customers will also be able to choose from a wide variety of Slurpee flavors, including classics like Blue Raspberry, Cherry, Pina Colada or Coca-Cola, the fan-favorite that made history as the first Slurpee drink in space last summer. Those who want to try something new can select limited-time only flavors like Mango Lemonade, which offers a blend of mango flavor and tart lemonade with a refreshing taste that demands they take another sip.

They can also try the new Slurpee mystery flavor What the Fanta. The color is orange, but looks may be deceiving. Shoppers are encouraged to try to decipher the secret Slurpee flavor.

Once again there is more, to the Slurpee deal, 7-Eleven is rewarding customers with 11 days of one-dollar deals on their favorite snacks. From July 1 to July 11, 7Rewards and Speedy Rewards members can snack on select items at participating 7-Eleven, Speedway and Stripes locations for just $1 in-store.

If you liked that you will love this, customers can also celebrate with $1 roller grill items like Big Bite hot dogs and taquitos, and enjoy fan favorites like a set of 10 mini-tacos, birthday cake and s'mores muffins, and $1 slices of pizza. Those in search of an extra energy boost to get them through a hot summer day can enjoy any sized iced coffee for $1.

Pool party, don’t worry, is you are swimming in the pool or basking in the summer sun, customers can also redeem their free Slurpee drink via 7NOW delivery on July 11 only. Additionally, for a limited time, new users of 7NOW can enjoy a free pizza with their first delivery order using the code "PIZZA."

Marissa Jarratt, executive vice president and chief marketing officer at 7-Eleven, stated, "We're thrilled to be celebrating Slurpee Day for the first time across all of our banners so we can spread the Slurpee drink birthday love even further," … "And 11 days of free Slurpee drinks is just the beginning. With a mystery Slurpee flavor, dollar deals on all roller grill items including Big Bite hot dogs and fan-favorite snacks and drinks such as pizza slices and any size iced coffee, this Slurpee Day is shaping up to be quite the celebration."

Invite Foodservice Solutions® to complete a Grocerant ScoreCard, or for product positioning or placement assistance, or call our Grocerant Guru®.  Since 1991 Foodservice Solutions® of Tacoma, WA has been the global leader in the Grocerant niche. Contact: Steve@FoodserviceSolutions.us or 253-759-7869

Independent Restaurants Rejoice Uber Meal Shipping is Here

 

While consumers are returning to work, and that’s creating opportunities for restaurant operators to refine their menus and add flavorful, satisfying snacks that also meet demands for portability. According to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions® “most consumers have found ‘new’ favorite restaurants, meals or meal components that they would like to share.”

Ready-2-Eat and Heat-N-Eat fresh prepared meals, meal components and snacking were already trending upward before the pandemic, but accelerated as consumers tended to snack throughout the day while working from home. Since many of those snack foods during the pandemic were sourced from retail, operators now face the challenge of attracting customers back with craveable snack items that are suited for Grab-N-Go and On-the-Go consumption.

In a new report by Technomic, called the 2022 Snacking Occasion Consumer Trend Report. They found One in five consumers (20%) reported that their snacking frequency increased during the pandemic. The report also found that portability is increasingly important to consumers when it comes to snacks. More than half (55%) of consumers said in 2021 that they typically consumed snacks while they were en route to another location, compared to 49% who said they did so in 2019.

The most common motivators that consumers cite for snacking include hunger between meals (cited by 37% of consumers) and the desire to treat oneself (33%). In addition, consumers often snack to alleviate stress or boredom and to elevate their mood.

Now consumers can share the meals, meal components and snacks they found over the past two years as well. Uber is launching Nationwide shipping - a new product that allows consumers to Get anything from beloved merchants in NYC, Miami, and Los Angeles (with more cities to come soon).

·         To place a Nationwide shipping order, open your Uber Eats app, select “Home” and scroll until you see Nationwide shipping.

·         Once you’ve selected the merchant you want to order from, select the item(s) you’d like to purchase and add them to your cart.

·         Confirm your order by viewing your cart and going to checkout. 

·         Review your order details and place the order.

·         You’ll receive an email with tracking information from the carrier (FedEx) soon after placing the order.

Don’t over reach. Are you ready for some fresh ideations? Do your food marketing ideations look more like yesterday than tomorrow? Interested in learning how Foodservice Solutions® can edify your retail food brand while creating a platform for consumer convenient meal participation, differentiation and individualization?  Email us at: Steve@FoodserviceSolutions.us or visit us on our social media sites by clicking the following links: Facebook,  LinkedIn, or Twitter

Learning How to Grocerant is Step One