Foodservice Solutions® Grocerant Guru Steven Johnson asked in 2010 on our blog “Can selling restaurant products in grocery stores create channel blurring?” Since then the retail foodservice industry and customer have both evolved. In 2013 consumers are informed, brand interactive, and in-control. If your goal is to expand brand value, drive year over year same store sales, you can’t simply continue to do what you have always done.
Should restaurants sell proprietary products in drug stores, department stores, grocery stores, supermarkets and convenience stores? What we know now is that entering the frozen food court is one path to success but not the only one. The channels of retail foodservice offering both fresh and frozen food have expanded. If you are a restaurant selling “thaw-2-fresh” customers understand it and that becomes the intersection of a new normal in the price, service equilibrium. If you cook from scratch consumers know that as well. If you sell in non-traditional food channels consumers not only know it they like it.
While we continue to see most legacy restaurant chains and the vast majority of start-up restaurants focused on a single avenue of distribution. We have now learned that channel blurring is only in the minds-eye of marketing agencies, chain marketers, and never in the minds-eye of the consumer. Today we are working in an Omni-channel retail world. The mounting disadvantages to selling within a single channel are three to one over advantages of selling in a multiple channels.
Restaurant marketers should be asking how do we best bridge the challenge of customer deferred buying? Today department stores, chain drug stores, liquor stores are selling Ready-2-Eat and Heat-N-Eat fresh prepared food that is deemed restaurant quality by consumers. If restaurant consumers are in a different channel of foodservice, then it is your obligation to extend the brand experience and brand promise. If you do not you heighten the risk of a non-traditional fresh food retailer capturing your customer increases dramatically.
Non-traditional fresh prepared food retailer’s specifically convenience stores and grocery stores have been experiencing double digit growth in fresh prepared food sales over the past three years. The leading companies the ilk of Sheetz, Casey’s General Store, and Wawa for more years than that. They are branding fresh prepared food items as an entity with identity with great success. Do you think they are going to sell in only one channel? No they are not and we have plenty of examples.
So the simple answer to the question how do restaurant markets best bridge the challenge of customer deferred buying, is reduce the brand experience gap by extending the brand into new non-traditional avenues of distribution with fresh prepared food. If your customer counts are flat or in decline for more than 3 consecutive quarters it just might be a clue that your customers are migrating to a new channel.
www.FoodserviceSolutions.us Outside Eyes for Inside Results Foodservice Solutions® specializes in outsourced business development. We can help you identify, quantify and qualify additional food retail segment opportunities or a brand leveraging integration strategy. Visit: www.FoodserviceSolutions.us Facebook.com/Steven Johnson, Linkedin.com/in/grocerant or twitter.com/grocerant
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