Amazon Go Not Sustainable Yet

 

At the intersection of fresh food retail and the consumer is a fledgling concept by Amazon called Amazon Go. After spending billions on Whole Food and stumbling, they rolled out Amazon Fresh a grocery store with technology and fresh food but it has failed to meet or exceed consumers expectations as well. So, they went back to the Urban Amazon Go concept and are trying to find a universal template they can leverage for dramatic success.  Will they be able to disrupt this space with success.  Well not yet, not today.

In the minds-eye of Steven Johnson Grocerant Guru® at Tacoma, WA based Foodservice Solutions® when it comes to fresh food retail Amazon has:

1.       Outstanding Grocerant Niche Fresh Prepared Food, Heat-N-Meals, and Meal Kits

2.       Great Data on Pricing Elasticity

3.       Great Data on Buying Patterns by Time

4.       Great Focus on Sustainable Packaging

5.       Great Technology

6.       Great Financial Backing

7.       Endless Ability to Experiment

8.       No Ability to understand the relationship between consumers intellectual quotient and consumers emotional quotient.

It is easy to see how ‘technology forwarded’ consumers like all of the technology embedded in each of Amazon’s fresh food retail concepts.  After the billions spent on fresh food sector concepts, new concepts, and revitalizing concepts they have not yet found the sweat spot of success in that space.    

The disconnect is clearly in the space between the consumers intellectual quotient (IQ) and consumers emotional quotient (EQ). Amazon has all of the parts they are simply missing the ribbon that ties them all together according to Johnson.

Amazon has proven itself as the preeminent omnichannel retailer in the world. In the fresh food space concept after concept the price, value, service equilibrium is being disrupted by the lack of understanding of consumers emotional relationship with fresh food. Simply put they don’t get the EQ of the consumer with respect to buying fresh food.

There is a blance between shopping in the store and online where the brand must tie both the EQ and IQ to the same place in the minds-eye of the consumer. Omnichannel consumers are more likely to be Millennials and have to be Amazons primary target customers. 

Unfortunately for Amazon they must believe that by introducing new technology to solve legacy fresh food retail pain points that is all the ‘discovery’ Millennials need.  They are wrong.  Millennials expect the technology to save time, and a seamless shopping experience, however they still want fresh food discovery according to Johnson.

The fact is whether a customer shops Whole Foods, Amazon Fresh, or Amazon Go they will find fresh full flavored grocerant niche Ready-2-Eat or Heat-N-Eat fresh prepared food.  Simply put 99 out of 100 visits the food is very good. They have little problem with fresh food quality.  However that is not enough to sustain a fresh food customer over time.  

Amazon has all of the parts from sustainable packaging, menu diversity, and brand messaging what is missing is an over lapping relationship with consumers food space emotional quotient. Don’t let you consumers emotion dangle on the edge.  Invite them in!

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

In a Battle for Share of Stomach

Don't Forget the

Consumers Emotional Quotient 

Yes, Gen Z and Millennials Want Grocery Store and Restaurant Gift Cards

 

Eating out or eating in makes little difference for Gen Z and Millennials that are off living on their own according to Steven Johnson Grocerant Guru® at Tacoma, WA, based Foodservice Solutions®.  Inflation is driving the cost of food eaten out or eaten in up, up, up.  This year a large number of consumers are going to request gift cards for necessities this holiday season for meals or meal components.

That’s right, don’t hide grocery gift cards behind the counter this holiday season. Some recipients, especially young adults, are very much hoping Santa brings them one this year, according to new research from fintech firm Givex.

If you run a restaurant, C-store, bodega, or grocery store, consider this, 43% of consumers between the ages of 18 and 34 said they would prefer to receive a gift card for necessities, such as groceries and gas, rather than an indulgence.

This is the first year Givex has conducted the gift card survey, so it’s impossible to make comparisons from prior years. But it’s a clear indication that there’s opportunity there for retailers, according to Givex Chief Commercial Officer Mo Chaar.

Chaar stated, “Gift cards need to be seen,” “Especially down the checkout lanes. That’s where a lot of consumers will buy them, from an impulse perspective.”

Now just over half of U.S. consumers surveyed (51%) said they plan to spend at least $100 on gift cards of all types this year, Givex found. And 87% of consumers said they plan on spending some amount of money on gift cards this year.

This is very important, 66% of those surveyed said inflation would impact their gift-buying plans this season. Regular reader of this blog know that inflation is top of mind, shoppers are out scouting for deals—including ones on gift cards.

Start selling your gift cards, as 57% of consumers polled said they’d be more likely to purchase a gift card this holiday season if it included a special promotion. That might include a discounted card (take 20% off $100), which was a draw for 67% of respondents; or a free gift card with purchase, which was a compelling offer for 64% of those surveyed, Givex found.

“That gives the consumer incentive to purchase or gives them a bonus gift card for themselves to use,” Chaar said.

Gift Cards Can Help Drive

New Customers and Repeat Customers

In a Competitive Retail Food World 

Retail gift cards tied with restaurant ones in terms of what recipients would like to get, with 44% saying those top their list. But open-ended credit card gift cards topped all the wish lists, with 71% of respondents saying that’s what they’d most like to receive.

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

Packaging Meal Components for a Family Dinner

Grocerant niche mix and match meal component bundling is now the cornerstone of retail foodservice success.  Mix & Match bundling continues to drive customer migration from legacy CPG products, restaurants, and grocery stores to new fresh food products and new avenues of fresh food distribution according to Tacoma, WA based Foodservice Solutions® Grocerant Guru® Steven Johnson.

Today "the new normal" in food retail requires a shift away from traditional food packaging, points of distribution, and a focus on fresh prepared food rather that pantry stocking according to Johnson. Meal components that focus on healthier choices are an invitation Millennials cannot seem to pass up. .

The team at Foodservice Solutions® identified, quantified, and qualified the vital role of portability as a major driver of the growth of the grocerant niche and subsequently Technomic revalidated our findings.   of the snacking trend, obvious not only at the drive-thru window, but also with packaged offerings at convenience stores like 7-Eleven, and at "boutique" establishments, like Starbucks.

Increasingly traditional mealtimes are less important than the convenience of fresh prepared meal components that can be consumer as immediate consumption, used later as a mix and match meal components for the perfect family meal, cocktail compliment, or meal replacement as a small meal. 

As traditional eating patterns evolve, new Non-traditional "dayparts" are emerging.  This is creating quite a conundrum legacy retailers in both the restaurant sector focused on selling complete meals and legacy grocery stores focused on collecting slotting fees rather than providing consumers incremental fresh food options.

In a new research by InfoScout looked at 77,820 American households who provided daily receipts to the company to determine which off-hour consumers are most apt to head to a restaurant in those times, as well as the overall percentage of visits made by consumers during off-hour dayparts and the basket size during those visits and how that compares with the basket size of traditional mealtimes finding “off-hour meals make up 35 to 48 percent of all trips”.

Food retail has become a battle for share of stomach. The battle for that share of stomach is taking is between all retailers sell food including the ilk of: Convenience Stores, Supermarkets, Dollar stores, Drug stores, Ikea, Liquor stores to name but a few.

In research from CocaCola they found that Millennials average 4.2 meals a day. Clearly Millennials are evolving as food consumers here are some additional facts from the Coca Cola survey: 

1. More than half eat breakfast outside of morning hours. 

2.  30 percent replace one or two meals daily with snacks. 

3. 35 percent eat dinner at restaurants offering "happy hour" deals.

4. 43 percent say they snack more today. 

5. Members of the 18-to-24 age group reported they would go to restaurants more if they stayed open later.

Packaging fresh food meal components and placing those components in avenues of distribution that are representative of the products target market is more important now than ever according to the team at Foodservice Solutions®.    Can your meals be turned into meal components?  Success does leave clues.

Are you trapped doing what you have always done and doing it the same way?  Interested in learning how www.FoodserviceSolutions.us 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:  www.FoodserviceSolutions.us for more information. 

Traditional Grocery Stores Continue to Stumble

The grocerant niche has been discounted, dismissed, and dished by legacy foodservice sector media outlets since 1991. The simple fact is the consumer migration from legacy grocerant stores to new non- traditional avenues of distribution is in no way slowing down according to Tacoma, WA based Foodservice Solutions® Grocerant Guru®, Steven Johnson.

Recently even legacy food industry research giants the ilk of Inmar Willard Bishop Analytics stated that “The food retail landscape is poised to shift dramatically as shoppers gravitate from traditional grocery stores to formats that more closely meet their needs”. Welcome to the grocerant niche Willard Bishop (WB)!

In a new study titled “Future of Food Retailing” Willard Bishop found “By 2021, dollar share for the traditional grocery channel will reach 44.4 percent, an increase of 0.2 percent… “Shares for nontraditional grocery will drop 0.7 percent to 39.1 percent. The convenience store channel will have a slight increase in shares, reaching 16.5 percent.

Here is the shocking from such a conventional foodservice research house  as the stated: “However, modest changes are often masked by large fluctuations occurring within the channel. For example, the number of traditional supermarkets will decrease by 24.6 percent. This decline is offset by double-digit growth in store counts for fresh-format, limited-assortment, and super warehouse formats.”

Most regular readers of this blog know grocery ecommerce trial is on the rise but the team at Foodservice Solutions® has predicted that it will top out at 11.75% of regular shoppers in 2021 and hold steady for several years before raising once again

The grocerant niche is expanding the reach of fresh food including meals, meal components, both Ready-2-Eat and Heat-N-Eat across all channels.  It is that rapid expansion that will slow ecommerce sales. Foodservice Solutions® team is not as pessimistic about legacy grocery retailers as we have firsthand knowledge some are trying very hard to adapt to the fast evolving retail landscape.

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

What’s For Dinner? Odds Are Handheld Food for Immediate Consumption

What is the cost of your loyalty program according to Steven Johnson Grocerant Guru® at Tacoma WA based Foodservice Solutions® it just might be time to evaluate if you are winning customers or buying them. 

With food cost deflation at hand and consumers still recovering from the great recession there is a battle for share of stomach underway. Today current research indicates that Portability and Price are key drivers of customer traffic in path to purchase according to Foodservice Solution® team. 

Back in the day Technomic edified Foodservice Solutions® 5 P’s of Food Marketing  the undercurrents of change and success within the food industry were forever changed.  That changed can traced back directly too Foodservice Solutions® 5 P’s of Ready-2-Eat and Heat-N-Eat fresh prepared food marketing.

Increasingly the role of price and portability are being used with greater emphasis than ever before according to Foodservice Solutions® team. The clear result can be found in customer migration from legacy chain foodservice retailer to new non-traditional food retailers the ilk of Ikea. 

The FIVE P’s of Food Marketing were first introduced back in 1994. Since then they have been implemented, and integrated by foodservice companies including Full Service Restaurants, Chain Drug Stores, Grocery Stores, QSR’s, and C-Store clients.  The 5 P’s are:

After repeated successful retail food industry adoption of Foodservice Solutions® 5 P’s of Fresh Food Marketing, Technomic conducted qualitative and quantitative research then compiled the following infographic highlighting the importance and consumer relevance that portability play’s today.  The Technomic infographic is entitled Pertinence of Portability:

McDonald’s 2 for $2.50, Burger Kings 5 for $4 or Wendy’s 4 for $4 are targeting the 50% of consumers over the age of 18 that are single.  These are meals and priced to be pantry busters.  The simple fact is a single person cannot cook a hamburger at home for a $1.00.  Why would anyone cook from scratch and spend more money while earning less than they did before the great recession?

Food commodity deflation continues as a back drop, fast food retailers see an opportunity to drive solid customer counts increases in 2017 regaining customers lost to grocery stores and C-stores the past 8 years. You have all heard the old adage time is money.  Handheld food for immediate consumption is driving top line growth and bottom line profits while garnering market share in 2016 because time is money.

Visit: www.FoodserviceSolutions.us  if you are interested in learning how Foodservice Solutions FIVE P’s of Food Marketing can edify your retail food brand while creating a platform for consumer convenient meal participation, differentiation and individualization or you can learn more at Facebook.com/Steven Johnson, Linkedin.com/in/grocerant/ or twitter.com/grocerant

Grocerant Ready-2-Eat and Heat-N-Eat Food Disruption

What’s for Dinner?  The simple truth of the matter is that consumers do not have the skill-set to cook all of the flavor profiles they have become accustom according to Tacoma, WA based Foodservice Solutions® Grocerant Guru®, Steven Johnson.

Today at 4 PM 67.3% of consumers do not know what they are going to have for dinner.  Even more important at noon everyday 82.9% of consumers do not know what they are going to have for dinner according to Johnson the ability to drive sales mid-day is an opportunity all food retailer should attempt.

That is why consumers are increasingly turning to nontraditional grocerant niche fresh food options. While about 37% of sales of consumable items such as food and beverages still take place at traditional supermarkets, with the sector posting more than $440 billion in sales last year, it was a 6% drop from 2015, according to Inmar Willard Bishop Analytics.

Regular readers of this blog know that convenience stores sold $73 billion worth of prepared foods, beverages and other food service last year, up 72% from 2010, according to the National Association of Convenience Stores. Two-thirds of sales at dollar stores come from food, beverages and other consumables, while they account for about a third of transactions at pharmacies.

Legacy grocery store chains operating in dense areas where shoppers have more online grocery options are particularly vulnerable to future consolidation, according to Barclays Capital Inc., which said that 38 of the top 50 grocery markets in the U.S. are already too saturated by food retail per capita or are on track to be so by next year. Why customer migration from cooking to grocerant niche fresh food according to the team at Foodservice Solutions® thus continued disruption.

Are you ready for some fresh ideations? Do your food marketing tactics look more like yesterday that tomorrow?  Visit www.FoodserviceSolutions.us 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. 

Xpress Convenience Store Sets Sights on Success

Foodservice Solutions® Grocerant Guru® Steven Johnson believes that when it comes to fresh food retail success a smaller footprint is better in the minds-eye of the consumer.  According to the team Johnson leads “fresh, faster, food is what customers are looking for and that requires a small footprint.”

This holds true around the globe and German retailer Edeka Südbayern is launching a new convenience store format, called Edeka Xpress. Edeka Südbayern will open around 50 stores, which will all be under 600 square metres in size, will be converted to the new format by the end of September from the smaller Tengelmann sites that Edeka is taking over.

Each of the the Edeka Xpress stores will feature a smaller product range than standard Edeka supermarkets, targeting the daily needs of customers in urban areas. The new format will feature fresh produce, convenience foods, and Edeka's own brand ranges.

Edeka Xpress will initially be introduced in cities including Munich, Starnberg, Freising, Augsburg, and Bad Tölz. In addition to the conversion of the Tengelmann outlets, five new Edeka Xpress store locations will be opened over the next two years

For international corporate presentations, educational forums, or keynotes contact: Steve@FoodserviceSolutions.us  the Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.  His extensive experience as a multi-unit restaurant operator, consultant, brand / product positioning expert and public speaking will leave success clues for all. Visit: www.FoodserviceSolutions.us for more information

In Retail Foodservice Influencers Matter

Success does leave clues and every now and then the team at Tacoma, WA based Foodservice Solutions® likes to hear from other on what they see coming down the road within the Grocerant niche that’s filled with Ready-2-Eat and Heat-N-Eat fresh prepared food.  This week our team like the term Vocal Aficionados. Here is what we learned:

In a new study titled on The future of retail, from Daymon Worldwide, we learned that shoppers evolving into advocates, helping brands determine ways to meet their new demands.

The study, "From Shopper to Advocate: The Power of Participation," presents six key shopper insights that will shape the future of retail. The insights have to do with looking beyond demographics, allowing for co-creation, catering to new ideas about “freshness,” understanding the value of private brands, interacting with engaged shoppers, and integrating mobile strategies.

It’s Not Just Generational

Customers are breaking the bounds of their demographics. It’s now more about values, attitudes and lifestyles than age, gender and income. Daymon breaks customers into three categories: Vocal Aficionados, Balanced Enthusiasts and Struggling Apathetics. Vocal Aficionados, with their zest for shopping and overall awareness, are the most valuable to retailers. Not only are they most likely to buy products themselves, but they also make for good brand ambassadors and marketers. Among other attributes ascribed to Vocal Aficionados are creative, passionate, wellness-oriented, socially minded, and digitally savvy. Comparatively, Balanced Enthusiasts, while engaged, are more pragmatic when it comes to shopping and slightly less digitally proficient. Struggling Apathetics, the least engaged of the three, are often more concerned with price due to financial constraints and other circumstances; despite this, the group is overall aware of trends.

Co-Creation Is the Future

Under the shopper-turned-advocate trend, co-creation provides a significant opportunity for growth. Shoppers, especially Vocal Aficionados, want to provide feedback to companies and assistance to brands in designing new products or services. Of those considered Vocal Aficionados, 55 percent are interested in giving company feedback, vs. 45 percent of Balanced Enthusiasts. And 51 percent of Vocal Aficionados are interested in helping a company design a new product or service, vs. 42 percent of Balanced Enthusiasts.

Fresh as the Gateway to Loyalty

Six out of 10 shoppers cite "fresh" categories as being important factors in their store choice. For engaged shoppers like Vocal Aficionados, "fresh" categories extend beyond produce, meat and seafood and into factors that fall within the “Participation Halo.” Fifty-three percent value in-store restaurants more than the average shopper; 33 percent more want a wide variety of natural and organic products; 31 percent expect more fresh prepared foods; 24 percent want more sustainably produced or sourced products; and 22 percent seek a more broad selection of local products.

A New Dimension of Private Brands

The most engaged shoppers are committed to, among other things, learning more about private brands and the features they might provide. Vocal Aficionados, compared to average shoppers, are 41 percent more likely to perceive that private brands have attractive packaging, 37 percent more likely to find them trendy, and 36 percent more likely to believe that they offer unique flavors they can’t get elsewhere. Other factors include whether the brands understand local needs, provide higher quality, offer the variety of products one cares about, meets one's needs, and fits one’s lifestyle.

Conversational Engagement

Daymon’s research indicates that shoppers’ relationships with brands now extend beyond the transactional and outside of the store — be it brick-and-mortar or online. To meet new expectations, brands have to use technology as a means to connect. Facebook, blogs, live online chats, Twitter, mobile apps and text messaging are all ways in which shoppers can provide feedback to brands. Vocal Aficionados are 58 percent more likely than the average shopper to want to provide feedback via Facebook, according to the study, and 44 percent more likely to want to provide feedback through Twitter. While it’s great to provide a platform for consumers to provide feedback, it’s also important to respond to feedback, making communication between shopper and brand a two-way street.

Seamless Integration With Mobile

While being digital savvy is great for communication with shoppers, it’s perhaps even more valuable when it comes to actual sales, which is why mobile integration is key. In fact, according to Daymon’s study, the digital experience an engaged shopper has with a retailer more often than not determines where they decide to spend their money. A stunning 83 percent of Vocal Aficionados are more likely than the average shopper to use their mobile phones during a shopping trip to help them make a purchase. And 90 percent are more likely to prefer stores that have apps for shopping that enable payment. Click-and-collect programs are 48 percent more popular with Vocal Aficionados, too.

“With legacy categories declining, digital strategies emerging and shoppers’ demand for engagement and customization increasing, retailers and brands must better understand the emerging needs and behaviors of shoppers on a global scale and dramatically rethink their go-to-market strategies,” said Dave Harvey, vice president of thought leadership at Daymon. “As shopping becomes more on-demand and increasingly personalized each day, we find ourselves amid a seismic shift that promises to reshape retail as we know it.”

So, what’s next according to Damon? Retailers can meet new customer expectations with the five following strategies:

1. Offer opportunities for collaboration and co-creation.
2. Allow for hyper-personalization of products and services.
3. Incorporate multi-sensory experiences, from discovery to digital.
4. Accent new interpretations of “fresh.”
5. Simplify the experience of shopping with an eye toward making it effortless. 

Regular readers of this blog know that the team at Foodservice Solutions® has over the past six months edified each of these findings in one way or another helping retailer find was to create complexity free meals, dinners, and food discovery.  For more clues to retail success follow us on Facebook.com/Steven Johnson, Linkedin.com/in/grocerant/ or twitter.com/grocerant. Email: steve@FoodserviceSolutions.us