Yes, Chain Restaurants Continue to Stumble over Change

 

Once again, Foodservice Solutions®, Grocerant Guru® Steven Johnson stated “The restaurant industry is not an industry known for trying to be first as in fastest to market with an ideation, food or technology advance. In the United States the larger the chain in almost all cases the more slowly they are to adopt something than a smaller chain or independent restaurants will.  Chain restaurant’s goal is simple feed one meal at a time in the restaurant while protecting and edifying the brand.”

Thus, the line between restaurants and food retailers is growing ever thinner. The fight for America’s food dollars continues to intensify as consumers find fresh prepared Ready-2-Eat food options at a wide and growing array of outlets across almost every retail channel including the ilk of convenience stores, chain drug stores, restaurants, grocery stores, club stores, vending and even more non-food retailers like dollar stores. 

Food manufacturers, retailers, and restaurants worry about choice overload, consumers have embraced their new choices and show no signs of returning to the old ways. This fight is taking place in what is called the grocerant niche. In short there is an intense battle for an increase in Share of Stomach according to Johnson.

Do You Want a Larger

Share of Stomach

Consumers are Dynamic Your Brand Must Be as Well

Historically chain restaurant leaders have denied the credibility of start-up competitors as non-relevant. The pizza sector is a great example; evolving from family dinning independents to national chain of “Red Roof” Italian, then to delivery only outlets and now take-N-bake is garnering market share in the pizza sector. Today, furniture store IKEA has a $2 Billion US dollar grocerant niche Ready-2-Eat and Heat-N-Eat business that is driving growth of the legacy furniture retailer.

At the intersection of the consumer, fresh prepared food and technology we fine that consumer eating behavior is evolving and is now beyond the control of traditional food marketers. Millennials & Gen Z consumers are driving change in eating habits and demand more ‘clean food’ according to Johnson.

Evolving culture and lifestyle, demographics along with the new uncertain economy are all putting pressure on the American food consumer: Demands of work, economic shrinkage, demands of raising a family, commuting, social interaction, kid’s after-school activities, all contribute to a food marketplace where convenience vies with price over legacy brands.

Recent advances in food packaging and new points of non-traditional food distribution have empowered consumer choice, and Americans are embracing these choices even as legacy marketer’s cringe. Who’s after restaurant food dollars simply put everyone.

Why should you care if Walgreens is selling fresh prepared Ready-2-Eat and Made-2-Order sandwiches? Why should you care if Whole Foods, Trader Joe’s, Safeway and Wegmans are selling Ready-2-Eat and or Heat-N-Eat fresh pizza?  Why should you care if Coinstar is selling Seattle Best Coffee at 1,000 locations for $1.00?

The retail food world is evolving at an increasing pace filled with innovation in food, portion size, points of distribution, and quality fresh prepared meal solutions.      The price, value, service equilibrium is resetting in retail foodservice.   In order to edify the brand and reinforce consumer relevance restaurateurs leverage Foodservice Solutions® 5P’s of food marketing: Product, Packaging, Placement, Portability and Price.

Many legacy food retailers continue to practice brand protectionism, stifle the brand while diminishing consumer relevance.  The consumer is dynamic not static.  Brands must be dynamic, evolving with the consumer.  Four years of watching other retail sectors thrive should be long enough. Success in the restaurant world is no longer simply about what happens within your 4 walls. 

Steven Johnson is the Grocerant Guru at Tacoma, WA based Foodservice Solutions®, with extensive experience as a multi-unit restaurant operator, Food Brand Strategic Advisor, brand / product positioning expert and at public speaking. Facebook.com/Steven Johnson, Linkedin.com/in/grocerant ortwitter.com/grocerant Steve@FoodserviceSolutions.us

At Whole Food Old Folks Welcome but Millennials we Love You!

Foodservice Solutions® team continues to believe that Whole Foods is dynamic not static as our Grocerant Guru® Steven Johnson explained yesterday when Whole Foods announced that Snap Kitchen sell grocerant niche Ready-2-Eat fresh prepared meals at some of its stores. 

The simple fact is Amazon owned companies are better at ‘looking a customer ahead’ according to Johnson than just about any food retailer.  Sure, Baby Boomers continue to eat, they just don’t eat as much a millennials and Whole Foods knows that. 

In new research from Whole Foods edified what most food retailers knew but do not talk about that “Millennials will pay more for higher-quality food and show a predilection for products promoting health and wellness, transparent sourcing and environmental responsibility”.  Let’s see just what else they found:

1.       68% said they would pay extra for high-quality food,

2.       53% would do so for high-quality nonfood items like personal care and cleaning products, Whole Foods reported. However, those figures fall to 27% and 20%, respective, for those who “strongly agree” they would be willing to shell out more dollars for high-quality food and nonfood items.

3.       Overall, 80% of respondents “strongly agree” (42%) or “somewhat agree” (38%) that quality is important when it comes to buying food, according to the online survey, conducted by YouGov for Whole Foods.

4.       Fifty-two percent of Millennials said they would pay extra for high-quality, healthy ready-made meals, with 19% strongly agreeing that they would do so.

5.       67% of respondents try to eat healthy on a daily basis, while 59% said they buy food and beverages to help them achieve physical and emotional well-being. About half avoid eating or purchasing foods with specific ingredients.

6.       Many Millennial consumers, however, encounter difficulties in trying to follow a certain nutritional regimen, the Whole Foods study revealed. Forty-five percent said that in the past year they tried a special diet or alternative eating approach, yet 63% found that it’s challenging to do so conveniently. Likewise, 52% agreed that it’s challenging to find the right products in grocery stores to maintain a special diet or alternative eating approach.

7.       Among various dietary regimens, 63% of those polled reported that they’re trying to include more plants and unprocessed foods in their diet.

8.       Sixty-four percent of survey participants said how and where their food is sourced influences their purchasing decisions. Similarly,

9.       65% agreed that transparency in food sourcing is important, with the same percentage indicating that transparency is key specifically when buying meat and seafood.

10.   Fifty-five percent of Millennials reported that they’re willing to pay extra for products adopting animal welfare standards, and 65% prefer to buy responsibly sourced brands and products.

11.   Along the same lines, half of Millennial shoppers look for food and beverages produced with less packaging and plastic,

12.   while 60% said they’re aware of the impact that their food choices have on the environment. Fifty-four percent indicated that they want to support mission-based brands that reflect their own values.

Whole Foods is ‘looking a customer ahead’ and understands that “The stories of how food is produced and grown matter to them — and to us. That is why we ban more than a hundred ingredients in the food we sell,”

Are you looking a customer ahead? Is your brand dynamic or static?  Foodservice Solutions® specializes in outsourced food marketing and business development ideations. We can help you identify, quantify and qualify additional food retail segment opportunities, technology, or a new menu product segment.  Foodservice Solutions® of Tacoma WA is the global leader in the Grocerant niche visit Facebook.com/Steven Johnson, www.Linkedin.com/in/grocerant/  or www.twitter.com/grocerant