Costco Destination Dinning

 

Costco has long been recognized as a destination for consumers seeking Ready-to-Eat (RTE) and Heat-and-Eat fresh prepared foods. This strategic focus has significantly enhanced customer satisfaction and loyalty, positioning Costco as a leader in the grocerant niche—a sector characterized by the fusion of grocery and restaurant-quality offerings. Steven Johnson, Grocerant Guru® at Tacoma, WA-based Foodservice Solutions®, emphasizes that Costco's commitment to providing flavorful, affordable, and convenient meal solutions has been instrumental in this success.

The $1.50 Hot Dog and Soda Combo: A Timeless Favorite

Since its introduction in the mid-1980s, Costco's hot dog and soda combo has remained steadfastly priced at $1.50, becoming an iconic offering that exemplifies the company's dedication to value. In 2025, this commitment continues, with the notable change of switching from Pepsi back to Coca-Cola products, a move that has been met with enthusiasm from many customers. This enduring deal not only attracts shoppers but also reinforces Costco's reputation for delivering consistent value.

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Rotisserie Chicken: A Staple of Quality and Affordability

Costco's rotisserie chicken, priced at $4.99, has become a staple for many households. Customers appreciate its larger size, freshness, and distinctive flavor profile compared to offerings from other retailers. This product exemplifies the Price, Value, Service Equilibrium that Johnson highlights as crucial in today's evolving fresh food sector. ​

Pizza: A Growing Contender in the Food Court

Costco's food court pizza has gained a loyal following, with customers praising its affordability and taste. The 18-inch pizza, priced at $9.95, offers a value proposition that rivals traditional pizzerias. In fact, Costco has become one of the largest pizza chains in the U.S., a testament to its success in the grocerant space. 

Evolving to Meet Consumer Preferences

In 2025, Costco continues to adapt its food court offerings to align with changing consumer preferences. Recent changes include menu adjustments and a renewed focus on customer experience. These efforts reflect an understanding of the importance of staying responsive to customer desires in the competitive retail landscape.​

Customer Satisfaction and Industry Standing

While Costco's fresh food initiatives have historically driven high customer satisfaction, recent reports indicate a slight decline. The American Customer Satisfaction Index (ACSI) survey revealed that Costco's satisfaction score dropped to 81 in 2025, down from previous years. Factors contributing to this decline include increased competition and evolving consumer expectations, particularly among younger demographics who prioritize technological integration and convenience. ​

Costco's emphasis on fresh, ready-to-eat foods like the hot dog and soda combo, rotisserie chicken, and pizza has been central to its strategy of enhancing customer satisfaction. By maintaining a balance of price, value, and service, and by adapting to consumer preferences, Costco continues to be a formidable player in the grocerant niche. As the retail food landscape evolves, ongoing innovation and attentiveness to customer needs will be key to sustaining and growing its market position.

​In recent years, Costco's Ready-to-Eat (RTE) offerings have significantly contributed to its customer satisfaction and loyalty. However, recent data indicates a shift in customer satisfaction levels. According to the American Customer Satisfaction Index (ACSI) Retail and Consumer Shipping Study 2025, Costco's customer satisfaction score has declined to 81, down from 85 in 2024. ​

Several factors may be contributing to this decline:

·         Increased Competition: Competitors like Sam's Club have enhanced their customer experience through technological innovations such as touch-free checkout, leading to higher satisfaction scores. ​

·         Evolving Consumer Expectations: Younger demographics, particularly Gen Z consumers, prioritize seamless shopping experiences that integrate both in-person and online tools. Costco's current offerings may not fully align with these expectations. 

·         Product Changes: Adjustments to popular food court items, such as the introduction of standing tables and modifications to menu offerings, have received mixed reactions from customers. ​

Despite these challenges, Costco continues to focus on delivering value through its RTE options, including the iconic $1.50 hot dog and soda combo, $4.99 rotisserie chicken, and $9.95 18-inch pizza. Maintaining the balance of price, value, and service remains central to sustaining customer satisfaction in the evolving retail landscape.

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Is The 65 Inch HDTV Syndrome Driving McDonald’s Growth

 

Consider this: the undercurrents of Foodservice Solutions® 65 Inch HDTV Syndrome have now reached not only La-Z-Boy and Uber Eats but also the world’s most successful global chain restaurant, McDonald’s. Steven Johnson, Grocerant Guru® at Tacoma, WA-based Foodservice Solutions®, identified, quantified, and qualified The 65 Inch HDTV Syndrome years ago, recognizing a shift in consumer dining habits that continues to shape the industry today.

The Rise of At-Home Dining and McDonald’s Adaptation

Not only is McDonald’s embracing The 65 Inch HDTV Syndrome, but the company has also partnered with innovative brands to deliver what consumers want: hot, delicious McDonald’s meals enjoyed from the comfort of home. With Uber Eats facilitating delivery, McDonald’s enables customers to enjoy their favorite menu items while lounging on a state-of-the-art La-Z-Boy, equipped with built-in coolers, light-up cup holders, phone chargers, adjustable seats, and even a McDonald’s-Uber Eats blanket that declares, “Going out is overrated.”

Elizabeth Campbell, senior director of brand and menu strategy for McDonald’s, highlights this trend, stating, “The McDelivery Couch sweepstakes celebrates our shared love of staying in, as well as our mission to bring people together over food and fun experiences.” The sweepstakes, running through April 8, allows customers to enter by tweeting about their favorite McDonald’s delivery items.

The Importance of Takeout and Drive-Thru Sales

While delivery is a growing segment, takeout and drive-thru sales remain critical to McDonald’s success. A staggering 70% of McDonald’s U.S. sales come from drive-thru orders, showcasing the brand’s focus on convenience. With over 13,500 locations nationwide, McDonald’s serves approximately 25 million customers daily, a testament to its ability to meet the needs of on-the-go diners.

Recent reports show that nearly 60% of consumers prefer picking up food via drive-thru or takeout rather than dining in. McDonald’s has capitalized on this trend by modernizing its drive-thru lanes with AI-powered ordering systems, dual lanes to speed up service, and an increased focus on mobile app orders. During peak hours, a McDonald’s drive-thru can process orders in under 5 minutes, a key factor in retaining customer loyalty.

The Role of Food Marketing Trends

Industry data reveals that 56% of consumers define the “quality of a product” as its most important attribute, followed by taste and price. This aligns with McDonald’s strategy to deliver high-quality, affordable meals in a fast and convenient manner. The food industry saw 22,952 new food and beverage products launched in 2025 alone, emphasizing constant innovation. McDonald’s, with its ever-evolving menu, has mastered the balance of tradition and innovation, keeping favorites like the Big Mac and McNuggets while introducing limited-time offers and healthier options to appeal to a wider audience.

Technomic research also shows that 12.6% of customers purchased pizza during a recent foodservice visit, and 16% of pizza purchases occurred as snack options, illustrating the growing trend of all-day eating. McDonald’s has addressed this demand with expanded snacking options like McCafe bakery items, chicken snack wraps, and new variations of fries and dipping sauces.

Creating New Electricity

The 65 Inch HDTV Syndrome supports the idea that consumers enjoy Eating-Out when Eating-In. According to Johnson, “Brand relevance is in part driven by innovation in new menu-related products in combination with new avenues of distribution, all of which are the platform for the new electricity.” This “new electricity” includes fresh foods, digital ordering, autonomous delivery, cashier-less retail, grocerant positioning, and seamless mobile payments.

Retailers must embrace the artificial intelligence revolution while also offering fresh, portable, and familiar food. McDonald’s is leading the charge by combining convenience, quality, and innovation to stay ahead in the competitive food industry. With an emphasis on drive-thru enhancements, takeout efficiency, and delivery expansion, the brand continues to set the standard for modern quick-service dining.

Are you looking for a new partnership to drive sales? Are you ready for fresh ideations? Do your food marketing strategies reflect the future of dining? Interested in learning how Foodservice Solutions® can elevate your retail food brand while creating a platform for consumer meal convenience, differentiation, and personalization? Email us at Steve@FoodserviceSolutions.usor visit www.FoodserviceSolutions.us for more information.

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Food Apps: The Food Industry's New Electricity

 

In today's fast-paced digital era, mobile applications have become the lifeblood of the food industry, much like electricity revolutionized industries in the past. For Generation Z and Millennials, smartphones are not just communication tools but gateways to culinary experiences, transforming mobile devices into 'mobile food courts' that drive both top-line sales and bottom-line profits.

The Rise of Handheld Marketing

The younger demographics have grown accustomed to handheld marketing, where personalized promotions and seamless ordering experiences are delivered directly to their smartphones. This shift has been accelerated by the widespread adoption of food delivery apps, which have fundamentally altered the landscape of the food service industry. While these platforms offer convenience to consumers and new sales channels for restaurants, they also present significant challenges in terms of profitability, operational complexity, and maintaining control over the customer experience.

Mobile Phones as 'Foodservice Super Highways'

Steven Johnson, Grocerant Guru® at Tacoma, WA-based Foodservice Solutions®, aptly describes mobile phones as the 'foodservice super highway'—a platform every brand must establish a presence on to remain competitive. This perspective is supported by the significant growth in digital ordering and delivery services. For instance, Dutch Bros Inc. reported a 34.9% increase in fourth-quarter revenue, attributing part of this success to plans for expanding mobile ordering and introducing more food options.

The Importance of Embracing 'New Electricity'

Incorporating mobile apps into a food brand's strategy is not merely a trend but a necessity for sustained growth and relevance. This 'new electricity'—the integration of digital technology into foodservice—enhances customer engagement, streamlines operations, and opens new revenue streams. Brands that fail to adapt risk losing market share to more tech-savvy competitors.

The Role of 'New Electricity' in Creating Brand Relevance

A brand without relevance is a brand destined to fade. The modern food consumer is digitally connected, socially engaged, and convenience-driven. Brands must embrace 'new electricity' to remain top-of-mind and indispensable in consumers' daily lives. Creating brand relevance through digital engagement involves:

1.       Personalized Marketing: AI-driven promotions and loyalty programs that anticipate consumer needs and provide tailored incentives.

2.       Seamless User Experience: A frictionless digital ordering and payment process that enhances customer satisfaction.

3.       Social Media Integration: Leveraging platforms like Instagram, TikTok, and YouTube to create shareable content and drive organic brand advocacy.

4.       On-Demand Convenience: Fast, reliable delivery and pickup options that cater to the 'I-want-it-now' culture.

5.       Omnichannel Engagement: Ensuring a cohesive brand experience across all touchpoints, from in-app interactions to in-store encounters.

Five Reasons Food Brands Need to Be on the 'Foodservice Super Highway'

1.       Enhanced Customer Convenience: Mobile ordering allows customers to place orders from anywhere, catering to the on-the-go lifestyle of modern consumers. This convenience can lead to increased order frequency and higher sales.

2.       Increased Operational Efficiency: Implementing a mobile ordering system streamlines the ordering process, reducing errors and freeing up staff to focus on food preparation and customer service. This efficiency can result in faster service and improved customer satisfaction.

3.       Data-Driven Insights: Mobile apps collect valuable data on customer preferences and behaviors, enabling brands to tailor their offerings, optimize marketing strategies, and make informed business decisions.

4.       Competitive Advantage: A well-designed mobile app can differentiate a brand in a crowded market, attracting tech-savvy consumers and positioning the brand as innovative and customer-focused.

5.       Adaptation to Changing Consumer Habits: The COVID-19 pandemic accelerated the shift towards delivery and takeout. Embracing mobile technology allows brands to meet these evolving consumer preferences and maintain relevance in a transformed dining landscape.

In conclusion, as mobile technology continues to permeate every aspect of life, food brands must harness this 'new electricity' to power their growth and stay connected with the digitally native generations. By establishing a strong presence on the 'foodservice super highway,' brands can drive sales, enhance customer loyalty, and secure a competitive edge in the ever-evolving food industry.

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Grocerants: A Business Model Driving Food Sales Success

 

The food industry is undergoing a major transformation, reshaping the way consumers select and experience meals. Through the lens of Steven Johnson Grocerant Guru® at Tacoma, WA based Foodservice Solutions® it's evident that grocerants—a hybrid business model that blends elements of grocery stores, restaurants, and convenience stores—are at the forefront of this change. By integrating prepared meals with traditional grocery shopping, grocerants are redefining the "new family meal," saving time while elevating food quality and expanding consumer choices.

A Historical Perspective on Grocerants

The concept of combining food retail and prepared meals isn't new, but its modern evolution began gaining momentum in the early 2000s. At the time, grocery stores started expanding their deli counters and adding hot food bars to cater to busy consumers. Over the past two decades, this model has evolved further, now incorporating fully integrated dining experiences, including sushi bars, chef-prepared meals, and high-quality takeout options.

The Consumer Struggle: Finding Fresh, Full-Flavored Quick Meal Solutions

Consumers today face a significant challenge: balancing the need for fresh, flavorful meals with the convenience required by their fast-paced lifestyles. Home meal replacement (HMR) options, initially introduced as a solution, often fell short due to their lack of variety, freshness, or high-quality ingredients. Traditional frozen meals, while convenient, don't always deliver the taste or nutrition consumers expect. Restaurant takeout is another alternative but can be costly and inconsistent in quality. This gap has fueled the rapid growth of grocerants, which offer freshly prepared, high-quality meals at a reasonable price, meeting the expectations of modern diners.

Why Consumers Are Flocking to Grocerants

1.       Convenience is King
With the demands of modern life, time-saving solutions are paramount. Grocerants provide a one-stop solution where consumers can shop for groceries and enjoy a freshly prepared meal in the same location. This particularly appeals to dual-income households, professionals, and busy parents.

2.       Cost-Effectiveness
Data from the Bureau of Labor Statistics highlights that restaurant menu prices have consistently risen, while grocery prices have increased at a slower rate. Grocerants offer an attractive middle ground, providing the experience of dining out at a more affordable price.

3.       Quality and Variety
Unlike traditional frozen meals or fast food, grocerants emphasize fresh ingredients and diverse menu options, catering to a broad range of dietary preferences and culinary tastes.

4.       Catering to Modern Spending Habits
Millennials, now the largest consumer segment, prefer experiences over material goods. Dining in a grocerant merges the restaurant experience with grocery shopping. Research by Harris Group shows that millennials are willing to spend up to 78% more on experiences that offer convenience and customization.

Food Industry Trends Fueling Grocerant Growth

·         Social Media Influence
Platforms like Instagram have transformed meals into shareable experiences. Grocerants capitalize on this by offering visually appealing dining spaces and Instagrammable dishes, encouraging consumers to promote them online.

·         Sustainability Matters
A Nielsen study indicates that 73% of consumers prefer brands committed to sustainability. Grocerants often emphasize locally sourced ingredients, reduced packaging, and transparency about food origins, aligning with eco-conscious values.

·         The On-Demand Revolution
With the rise of food delivery apps, consumer expectations have shifted toward speed and accessibility. Grocerants respond by offering meal kits, grab-and-go options, and app-based ordering to meet the needs of tech-savvy shoppers.

The Future of Home Cooking: What Could Fill the Gap in Five Years?

While grocerants are bridging the gap between grocery shopping and restaurant dining, the evolution of food convenience continues. Looking ahead, these innovations may further redefine home meal solutions:

1.       Smart Kitchen Integration
AI-powered appliances and smart kitchen assistants will guide home cooks with real-time recipe recommendations based on available ingredients, reducing meal planning time and food waste.

2.       Hyper-Personalized Meal Kits
Customizable meal kits tailored to specific dietary needs, freshness preferences, and even individual nutritional goals will become more prevalent, offering a fresh alternative to prepackaged meals.

3.       Automated Fresh Food Vending
Vending machines stocked with fresh, chef-prepared meals and healthy options will be conveniently placed in workplaces, transit hubs, and residential areas, making quick meal solutions more accessible.

4.       Grocerant AI Shopping Assistants
AI-driven platforms will allow consumers to pre-select fresh meal components online, which grocerants will then prepare for pickup or delivery, reducing wait times while maintaining meal freshness.

Reimagining the "New Family Meal"

The grocerant model is not just about convenience; it reflects the evolving needs of modern families, whether they consist of young couples, single parents, or roommates. Instead of spending hours cooking, families can now enjoy chef-quality meals tailored to their tastes without compromising on time or flavor.

The Future of Grocerants

Grocerants have moved beyond being a niche trend to becoming a fundamental part of the food industry's future. By 2030, industry experts predict grocerants could account for a significant share of global food retail sales. Traditional grocery stores must adapt by integrating dining experiences into their business models to remain competitive.

In the ever-changing food industry landscape, grocerants represent more than just a business model—they are a consumer-driven revolution. By delivering quality, variety, and convenience all in one location, grocerants have cemented their role as a cornerstone of the modern dining experience, offering a win-win solution for both consumers and food retailers.

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