Customers Like Shopping at Costco Online

Battle for Share of Stomach

It’s never to late to cater to customers.  While Costco was late to get serious about internet retail much like Dominos Pizza was when Costco got serious they had picked up all of the right clues and they are now leveraging long standing customer value to drive incremental sales online according to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.

Just like Dominos pizza going from lager to leader with online pizza sales, Costco is now the new ‘King” online retailers, surpassing Amazon, which held the No. 1 spot since 2010, according to the American Customer Satisfaction Index (ACSI) Retail and Consumer Shipping Report 2018-2019.

The ACSI determines customer evaluations of the quality of products and services available to U.S. consumers, with all measures reported on a scale of 0 to 100, so let’s look at what they found:

1.       Costco scored an 83 on ACSI’s scale, likely thanks to its Kirkland private brand, offering quality products at a low cost, which helps keep competing brand prices low.

2.       With its retail business growth slowing since its acquisition of Whole Foods Market, Amazon retreated 4% to an ACSI score of 82, matching the combined score of smaller online retailers, which are up 1% year over year, per the report.

3.       Target Corp. trails Amazon in internet retail with an ACSI score of 80, while Walmart Inc. anchors the bottom of the category with a score of 74.

Here is what all food retailers need to think about according to the ACSI report, “the internet remains consumers’ preferred method of shopping, despite falling 2.4% to an ACSI score of 80.”

4.       Customer satisfaction with supermarkets sank 1.3% to an ACSI score of 78, according to the report. However, 5.

5.       Trader Joe’s Co. and Wegmans Food Markets showed 1% improvements over the last year, with Trader Joe’s rising to a score of 86—bringing it to the No. 1 spot across all supermarkets and retailers, including e-commerce giant Amazon (82)—and Wegmans rising to a score of 85.

6.       Publix Super Markets fell 2% to tie with Aldi, which remained unchanged, at 84. Costco also remained unchanged in the supermarket category, with a score of 83, while most other large chains declined. For example, H-E-B slipped 1% to 82, and Sam’s Club dropped 2% to 80.

7.       Whole Foods also dipped 2% to 79, despite its acquisition by Amazon, bringing it to a tie with BJ’s Whole Sale Club (down 1%), Hy-Vee Inc. (down 2%), The Kroger Co. (down 2%), ShopRite (unchanged) and the combined score of smaller supermarkets (down 2%).

So, how is your brand evolving to drive food sales, beverage sales, online or in the store? What are you doing to expand your brands customer relevance and drive sales better than other food retailers? Is your brand creating a platform that is consumer interactive and participatory?  No, well we can help.

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

Can Shake Shack Customized Marketing Cut It

Sure, Shake Shack sales volume per store are impressive today averaging $4.6 Million per unit in Q4 2018.  They did that by offering a ‘better burger’ and you can get anywhere else.  Ok, so now what as Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.

The problem is Shake Shack is now running into the same problem Whole Foods, Pappadeaux Seafood Kitchen, and all other specialty food retailers find after several years of successful growth. Shake Shack caters to an urban lifestyle consumers with more disposal income and consumers with more exposure to fresh food fare according to Johnson; the problem is those consumers are limited in numbers. 

So, when Shake Shack announced that will be rolling out two food trucks—one in the greater tri-state area (NY, NJ, CT + PA) and one in the Atlanta metro area we ask Why? Do they think they can sustain growth in the suburbs?  That is highly unlikely unless they reduce the average check size substantially.

Sure, fans of Shake Shack can book the truck at www.shakeshack.com/truck by simply filling out the form with their name, email address and event details. The Food Truck menu is customizable based on the event, and can include Shack classics like the ShackBurger, Chick’n Shack, ‘Shroom Burger, fries and shakes. Pricing is based on the duration of the event and the number of estimated people in attendance. 

We ask will that drive sales, build buzz, or simply put Shake Shack in the same league as Red Robin and Burger King?  What is Shake Shack’s goal? Drive Growth, Drive Profits, Drive Brand Buzz and at what cost?

The truth is the next 15 years growth in urban communities will outpace that of the suburbs for most branded food growth according to Johnson.  Who, continued saying urban brands growth needs to be focused on urban customers.  

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 Facebook.com/Steven Johnson, www.Linkedin.com/in/grocerant/ or www.twitter.com/grocerant/

Chain Restaurants Continue to Stumble over Change Why

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 restaurants 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.

Battle for Share of Stomach

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 marketers 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

Red Robin’s Mobile Marketing

Success does leave clues and mobile marketing is a clue all food marketing tool-kits should have inside.  However, while consumers are dynamic not static, they also have long memories and the foundation of mobile food marketing was not the digital phone but a cart on the street, then came food trucks according to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.  

Johnson, continued saying successful food retailers understand that differentiation does not mean different it means familiar but with a twist. Red Robin Gourmet Burgers is doing just that with a food truck via a nine-state tour in its new “Forever Yummm” food truck, expecting to cover 9,200 miles in three-and-a-half months and offer samples along the way.”

Amy Woolen, Red Robin’s vice president of brand marketing stated “The fully functional food truck is designed to allow fans to experience all the Yummm and fun surrounding Red Robin's 50th celebration,” “It's highly approachable and gives people a reason to join in on the fun and celebrate this milestone with us.”

Denny Marie Post, Red Robin’s president and chief executive officer, said: "Through the years, while the restaurant has changed and the menu has evolved, the brand continues to meet the needs of generations because we infuse fun, creativity and innovation into everything we do.” Mobile Food Marketing with relevance is elevated with digital communication.  However never forget the foundation of food marketing give the consumer what they want where they want it.

Do your food marketing ideations look more like yesterday than tomorrow? Have you integrated the familiar with the new? 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.

Saladworks Finds Growth inside Grocery Stores

Driving top line sales and bottom-line profits is the goal for every chain restaurant.  Finding, funding, and fueling that growth is the hard part according to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.

Saladworks opened its first-ever location in a grocery store last February inside a remodeled ShopRite, grocery store in Philadelphia, PA. Given the strong customer feedback, two more Saladworks restaurants are now slated to open in ShopRite and Fresh Grocer stores.

“The store is doing extremely well. So we are expanding in the next 60 days into two more stores, with plans to grow in this category aggressively,” A ShopRite spokesman told the press. “Part of our mission is to put healthy food within the reach of everyday consumers. We want to put fresh, veggie-centric meals in front of as many people as we can,” according to ShopRite. “To be able to go to where the people are, we’re opening more locations and expanding our traditional and nontraditional locations, such as airports, schools, colleges, military bases and office buildings. Grocery stores have a tremendous amount of traffic and people who are looking to eat healthy.”

The Saladworks at the ShopRite utilizes only 150 square feet and stands in an island space near the store’s front entrance. Saladworks’ compact footprint makes it a flexible prepared-foods option, saving consumers time. 

Currently, Saladworks has 100 restaurants in 17 states; just think how much faster they can grow their brand by partnering with a retail grocery chain.  What partnerships can help you drives sales?

Once again I repeat that all food retailers today must understand that customer relevance is elevated when two brands build off each other complementing consumers preferences. Is your brand is searching for the new electricity to help drive the brand forward. So, just what is your brands new electricity? According to Johnson, “Brand relevance is in part driven with innovation in new food products in combination with new avenues of distribution all of which are the platform for the new electricity.”

Johnson stated “that in my minds-eye the new electricity must be very efficient for the supply and includes such things as fresh foods, free food / sampling, beer, developing brands, unique urban clothing, grocerant positioning, Fresh food messaging, autonomous delivery, cashier-less retail, plates, glasses, cash-less payments, digital hand-held marketing.

All retailers to survive the next generation of retail must embrace the artificial intelligence revolution while simultaneously embracing fresh food that is portable, fresh, with differentiation that is familiar not different.  Consumer like Eating-Out when Eating-In.

Are you looking for a new partnership to drive sales? Are you ready for some fresh ideations? Do your food marketing ideations look more like yesterday than tomorrow? 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.

Balkan Treat Box Food Expands with Traditional Footprint

Success does leave clues and Balk Treat Box success has grown to the point that they have out grown the food truck space so they opened a brick-and-mortar to build on customer frequency trends that were driving success according to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.  

Balkan Treat Box started as a food truck venture and now it is restaurant concept that features the cuisines of the Balkan Peninsula with food inspired from Bosnia to Turkey.  “With wood-fire cooking as an essential component to the menu, Balkan Treat Box will offer a new fast casual dining experience” according to the company.”

The opening of Balkan Treat Box is a dream realized for owners, chef Loryn Nalic and her husband, Edo. Loryn, a seasoned chef, fell in love with Bosnian food as she fell in love with Edo, who is a Bosnian refugee. Before opening the Balkan Treat Box food truck, Loryn traveled to the Balkan region for a two-month culinary exploration to cook with the locals and learn how to make everything from somun and cevapi to the perfect Turkish pide.  

While the new restaurant Balkan Treat Box is a fast casual, counter-service restaurant, Nalic makes every dish to order so anticipate wait times of up to 15 minutes from ordering in the opening weeks. Upon hiring additional staff, Balkan Treat Box does plan to still operate the food truck in the spring/summer season. Additional plans include breakfast and catering menus as well. Sales drive growth. How is your concept evolving?  Are you growing new points of distribution? 

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, Linkedin.com/in/grocerant/ or twitter.com/grocerant

Grocery Service Deli Food Sales Threaten Restaurant Sector Sales

Dinner for less; less money, less cooking time, less clean-up time are the undercurrents driving grocerant niche Ready-2-Eat and Heat-N-Eat fresh prepared food sales at supermarkets and grocery stores today according to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.  

Boy, have times changed, foodservice at retail looks different across the grocery landscape as more and more fresh prepared food items continue to enter the grocery store. While the cry, ‘What’s for Dinner’ may be the same the lines between grocery and restaurant blur in a number of ways, from deli cases with prepared foods to hot food bars and sit-down restaurants with beer and wine all touting convenience.

Restaurant sector menu prices were up 2.6% in 2018, while wholesale food prices were down 0.01% and consumers seeking relief from higher prices and noticed that grocery store service deli food cost less, they have tried it and report that most of it today is ‘restaurant’ quality according to Johnson. 

In 2019, 90 percent of restaurant guests research a restaurant online before dining at the restaurant, checking menu options, pricing, and seating.  If your restaurant is not competitive in menu price, menu product mix, or have a portability component you could be losing sales to a grocery store.

More and more we are seeing grocers adding cafe-like seating areas, a platform for consumer convenient meal participation, differentiation and individualization. That is to say; of meals at made-to-order stations with all food prepared fresh for either eat-in or take-out. “

If you’re a restaurant, does your concept look more like yesterday than tomorrow? Consumers are dynamic not static you brand must be as well.  Looking different does not mean different its meal familiar but with a twist.  Should you be offering grocerant niche fresh food to drive incremental sales? Are you prepared to spur growth and meet consumer needs and demands?

Interested in learning how Foodservice Solutions 5P’s of Food Marketing 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.