The Grocerant Guru® Report: Why Legacy Retailers May Be Fading While Value-Driven Innovators Thrive

 

Today’s grocery shopper isn’t just hunting for bargains, they’re navigating a maze of digital options, private-label innovations, and flavor-forward experiences. If you’re still playing the legacy game of weekly circulars and national brand mimicry, you're not just behind, you're invisible according to Steven Johnson Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.

Welcome to the new consumer landscape. The grocerant evolution is in full swing, and if you’re not adapting, you’re preparing to vanish.

 

Consumers Don’t Just Want Value—They Demand It

The narrative around value has shifted. It’s no longer about being the cheapest—it’s about being smart, authentic, and frictionless.

·       Private label ascension: Store brands now make up 22¢ of every food dollar spent. Even Gen Z and Millennials—once skeptical—are embracing them for quality and affordability. But this isn’t just about low-cost macaroni; think plant-forward meals, globally inspired sauces, and functional snacks. The best private labels offer discovery, delight, and digital integration.

·       Price anxiety persists: Despite moderated inflation (~1% food-at-home in 2024), 70% of consumers still worry about rising prices. 78% fear tariff impacts. Consumers aren’t spending less—they’re spending smarter.

·       Cherry-picking evolves: Boomers focus on unit pricing and bulk deals, while Gen Z favors health halos and personalized nutrition. Retailers chasing both with high-low promos and EDLP are splintering their strategy and confusing their base.

Grocerant Guru® Takeaway:
The winners? Aldi, Lidl, Trader Joe’s—lean operators mastering private label brand theater, tech-activated pricing, and clear value storytelling. Legacy players? Still clinging to old mix-models, hoping the weekly flyer still matters.

 

The Digital Grocery Shopper Has Outpaced the Retailer

Online ordering isn’t “optional” anymore—it’s expected. And it’s evolving beyond cart-filling into a full-blown digital food lifestyle.

·       Digital dominance: From just 9% pre-COVID to nearly half of U.S. shoppers ordering groceries online—it’s not a fad, it’s a demand signal.

·        Omnichannel isn’t just apps—it’s architecture: Retailers need integrated loyalty, frictionless payment, inventory visibility, and AI-powered suggestions that feel like a concierge service, not a checkout workaround.

Grocers who still operate in “aisle-first” mode—deploying coupons, flyers, and banner ads—are failing to meet this digital pace.

Grocerant Guru® Takeaway:
Consumers expect unified experiences: order from your couch, pick up curbside, get AI-generated meal solutions, and see ingredient traceability. Discounters and disruptors get it. Legacy retailers? Still patching together last decade’s solutions.

 

Brand Is the Experience—Not Just the Label

It’s not about price tiers anymore; it’s about emotional connection.

·       Niche brands boom: Look at Goodles—nostalgic comfort meets health-forward messaging. With market share leaping 0.6% to 4%, they’ve nailed adulting with flavor and flair.

·       Shopper-led discovery: In-store “moments” now drive sales—think seasonal treasure hunts, globally curated endcaps, and visually immersive shelfscapes.

·       Visual merchandising matters: Trader Joe’s wins by offering fewer SKUs—yet more surprises. Their stores feel like a trip to a local food bazaar, not a bulk warehouse.

Grocerant Guru® Takeaway:
The future is brand theater—limited edition drops, social buzz, and retail as entertainment. Legacy chains often skip this entirely, confusing loyalty with habit.

 

Tech Is Speed, Precision—and Personality

Agility defines success. Retailers stuck with bloated operations and sluggish innovation? They’re not just slow—they’re getting passed.

·       Lean grocers run laps: Aldi and Lidl deliver rapid innovation with tight SKU control, efficient labor, and simple formats.

·       AI leads the charge: From predictive stocking to hyper-personalized promotions, smart grocers are using data to anticipate—not just react.

·       Experiential tech rises: Augmented reality, mobile self-checkout, and real-time pricing updates transform store visits into interactive experiences.

Grocerant Guru® Takeaway:
Consumers see the difference. Legacy players don’t need gimmicks—they need actionable tech. Smart shelfing, in-cart marketing, AI-generated bundles… this is the new frontline.

 

History Repeats Itself: Will A&P's Fall Be Kroger’s Future?

The demise of A&P was a warning shot—overexpansion without modernization. Weekly ads, bloated inventories, and physical-first growth failed as consumers evolved.

Today, Kroger, Albertsons, Publix, and others risk the same fate if they:

·       Push stale private labels that imitate, not innovate

·       Overbuild formats without experience upgrades

·       Delay in creating unified digital ecosystems

The consumer doesn’t wait—and neither should retailers.

 

Final Takeaway: Reinvent or Retreat

Modern shoppers are:

·       Budget-conscious but experience-seeking

·       Digitally fluent and channel agnostic

·       Brand-aware and emotionally invested

Grocerant models deliver: streamlined assortments, rich brand engagement, and tech-driven customization. Aldi, Lidl, Trader Joe’s, and niche disrupters understand that food is flavor, feeling, and function.

Grocerant Guru® Closing Thought:
If you think private label is just a cheaper version of Heinz and omnichannel is a glorified website, you’ve already lost. Stop expanding square footage—start expanding brand moments.

The question isn’t “Can legacy grocers adapt?”
It’s “Will they?”

Gain a Competitive Edge with a Grocerant ScoreCard

Unlock new opportunities with a Grocerant ScoreCard, designed to optimize product positioning, placement, and consumer engagement.

Since 1991, Foodservice Solutions® has been the global leader in the Grocerant niche—helping brands identify high-growth strategies that resonate with modern consumers.

📞 Call 253-759-7869 or 📩 Email Steve@FoodserviceSolutions.us

The Great Divide: How 2024 Redefined Winners and Losers in the U.S. Restaurant Industry

 

A Year Defined by Value, Relevance, and Reinvention

In 2024, U.S. restaurant industry sales grew just 3.1%, the slowest pace in over a decade (excluding 2020). Meanwhile, consumer spending at restaurants rose 6.6%, indicating that rather than declining demand, the industry is undergoing a seismic shift according to Steven Johnson Grocerant Guru® at Tacoma, WA based Foodservice Solutions® Top-performing chains thrived on adaptability, digital fluency, and value-driven offerings—while legacy players losing ground demonstrated how rapidly stagnation can lead to decline.

 

Chains That Thrived: Smart Pricing Over Gimmicks

Leading chains successfully recalibrated strategy around competitive pricing, digital engagement, and menu clarity, driving steady growth—without relying on trendy spin-offs.

·       McDonald’s: Contrary to early experimentation with its CosMc’s beverage concept, McDonald’s has dropped the standalone coffee‐brand initiative and refocused on its core offering. Growth in late 2024 and early 2025 was largely driven by well‑priced value meals, including the $5 Meal Deal introduced in mid‑2024, which helped drive traffic when fully implemented. McDonald’s also leaned into its scale advantage, using loyalty data to tailor value messaging.

·       Starbucks: Continued to innovate with mobile ordering, premium beverage launches, and global expansion of branded experiences.

·       Chick‑fil‑A: Delivered strong growth through brand loyalty, service consistency, and measured global expansion.

·       Domino’s: Leveraged delivery partnerships, value promotions, and product innovation like stuffed crust launches.

·       Raising Cane’s: Built buzz via focused menu strategy, rapid expansion, and high‑profile collaborations.

 

Chains That Faltered: Status Quo Isn’t Sustainable

Chains failing to modernize—especially those relying on old value models or stale menus—faced steep declines in a market dominated by innovation and digital-first strategy.

·       Red Lobster: Filed for bankruptcy, suffering from weak seafood demand and brand fatigue.

·       TGI Fridays: No longer immune from financial collapse; capital structure and outdated appeal accelerated its decline.

·       KFC: Sales dropped by ~4%. The brand has struggled to compete with fresher fast‑casual and fast‑food options.

·       Del Taco: Saw ~4.2% sales drop; franchisee bankruptcies and rising costs exposed structural vulnerabilities.
These brands underscore how clinging to outdated formats—and ignoring evolving consumer expectations—can quickly erode market position.

 

Fast-Casual Momentum: Quality + Speed = Loyalty

The fast-casual segment grew ~9%, surpassing quick-service growth (~2.3%) and casual dining (~1.3%). Consumers are choosing better ingredients, customization, transparency, and tech-enhanced ordering experiences. These brands often lead with:

·       Chef-crafted, flexible menus

·       Traceable sourcing

·       Seamless digital ordering and loyalty integrations

·       Strong storytelling and community engagement

 

Marketing & Digital Strategy: Where Today’s Dollars Are Spent

·       Nearly all consumers read online reviews pre‑dining; platforms like Yelp underscore how even a 0.5‑star shift can alter business revenue by ~27%.

·       Digital ordering and delivery have grown roughly 300% faster than dine-in volume since 2014.

·       Influencer and targeted SEM marketing spending continues rising as review platforms and reputation shape visitation.

·       Consumers now expect weekly takeout or delivery, with many spending $50+ per order.

Together, these realities make digital reputation, targeted advertising, and delivery optimization foundational, not optional—whether you’re a national chain or local restaurateur.

 

Updating the McDonald’s Narrative: Coffee Wasn't the Growth Driver—Value Was

McDonald’s CosMc’s concept—a small offshoot focused on speculative beverage innovation—sparked buzz but was shut down in mid‑2025. Executives confirmed the concept will not continue standalone; instead, select CosMc’s-inspired drinks will roll into traditional McDonald’s locations.

Growth momentum in 2024 came not from CosMc’s, but from reestablishing McDonald’s core value proposition—particularly the $5 Meal Deal—alongside sharper use of scale and loyalty data to retarget price-sensitive guests. McDonald’s aims to restore traffic via affordability, while maintaining margins through operational scale.

 

Looking Ahead into 2025: Where Industry Leaders Are Betting

🔹 Continued fast-casual dominance

Offering quality, speed, customization, and local brand stories.

🔹 Smarter, tech-enabled value strategy

Chains with scale (like McDonald’s) will dig deeper into loyalty-driven pricing and differentiated promotions—value is best defended with precision pricing, not blanket markdowns.

🔹 Beverage innovation folded into core service

CosMc’s may be gone, but McDonald’s is integrating standout flavors into its menu at existing stores. This hidden “learning lab” approach positions beverage as growth—not distraction.

🔹 Personalization via AI and loyalty data

Chains are investing in AI-driven promotions, demand forecasting, and customized offers—honoring frequency and feedback.

🔹 Growth of retail product lines

Sauces, merchandise, and packaged items offer new revenue streams and deepen customer loyalty.

🔹 Sustainability and sourcing as brand anchors

Consumers increasingly reward transparency and planet-friendly practices—especially in millennial and Gen‑Z demographics.

 

Actionable Takeaways for Food Industry Leaders

1.       Price strategically, not opportunistically: Value messaging must resonate through local economics—not inflated list prices.

2.       Test innovations discreetly: McDonald’s CosMc’s showcased how to incubate menu ideas without disrupting the core brand.

3.       Invest in digital voice: Loyalty programs and data analytics are your early warning and early success systems.

4.       Lean into fast-casual expectations: Chef‑driven, flexible, narrative-led menus win where chain rigidity loses.

5.       Expand product horizons: Branded retail items and sauces extend shelf life beyond restaurants.

6.       Brand with purpose: Sustainability, local sourcing, and community grants increasingly attract premium pricing and loyalty.

 

Think about this, 2024 ushered in a marketplace separated by those prepared to evolve and those anchored in legacy models. Success in 2025 and beyond demands value grounded in insight, innovation incubated wisely, and operations sharpened through digital sophistication. The divide is real—and the path forward is clear.

Are you ready for some fresh ideations? Do your food marketing ideas look more like yesterday than tomorrow? Interested in learning how our Grocerant Guru® 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 one of the following links: Facebook,  LinkedIn, or Twitter

Meals, Menus, and The Cost of Eating in America

 

Grocery Stores: More Than Just Sticker Shock

Food Fact: The grocery food index rose 0.3% in June — mirroring May’s increase — with notable price hikes in essentials like coffee, beef, and fresh produce.

Grocery stores have long been pillars of American food culture, evolving from mom-and-pop markets to supermarket giants and digital-first fulfillment hubs. But while food-at-home inflation trails restaurant inflation, the pressure is mounting. According to NIQ (formerly NielsenIQ), unit sales in U.S. grocery stores have declined by over 2% year-over-year, even as dollar sales inch upward — a clear sign of shrinkflation, smaller basket sizes, and hyper-strategic buying.

How Consumers Are Cutting Back

·       Downshifting Brands: Private labels are no longer seen as compromises. In fact, 85% of shoppers now consider store brands to be equal or better in quality than national brands, according to FMI. Store brand sales surged by $9 billion in 2024, reaching a record $271 billion, driven by innovation in categories like plant-based meals, global flavors, and clean-label snacks.

·       Fewer Trips: Weekly runs are evolving into biweekly hauls. According to Inmar Intelligence, trip frequency declined by 7% in the past year, while consumers increasingly rely on apps and digital circulars to pre-plan meals around loyalty perks, digital coupons, and BOGO events.

·       Reduced Basket Size: "Just-in-time" shopping is in. With more Americans preparing two to three mini-meals per day, the demand for fresh, portioned, and snackable goods is surging. Small-format produce (like mini avocados and snackable cucumbers), single-serve protein portions, and ready-to-use kits are leading sales growth.

 

Restaurants: Menu Prices Climb, Diners Step Back

Food Fact: Restaurant prices have increased for 27 straight months. In June, full-service menu prices jumped 0.5%, while limited-service edged up 0.2% — outpacing grocery inflation yet again.

Even as foot traffic stabilizes, consumer behavior is shifting. The National Restaurant Association reports that 58% of adults are eating at restaurants less often than they did a year ago, with middle-income households pulling back the most. Geographic disparities are also growing: full-service menu prices in the South and West are up over 4% year-over-year, compared to 2.8% in the Northeast.

How Diners Are Saving

·       Trading Down: Quick-service and fast-casual chains — particularly those with digital value menus and family bundle promotions — are gaining traction. McDonald's $5 Meal Deal and Chipotle’s loyalty boosts are prime examples of how brands are recalibrating to meet price sensitivity.

·       Skipping Sides & Extras: High-margin items like beverages, apps, and desserts are on the chopping block. Toast data shows that 45% of diners now order fewer extras compared to 2023, prompting restaurants to redesign menus with modular pricing and more value combos.

·       Dining Out Less Often: Dining is reverting to its pre-2010 pattern — a "treat behavior" rather than a regular habit. Restaurants are investing in experience enhancers: live music, chef-curated menus, and loyalty events to keep the emotional pull strong.

 

Convenience Stores: Quick Stops, Slower Sales

Food Fact: In 2024, convenience stores — typically resilient during inflation — are feeling the squeeze. Foot traffic is down, and the average basket size has decreased by 6.2%, according to NACS.

Long seen as the go-to for impulse snacks and emergency fuel, convenience stores are struggling to retain their edge. Even loyal C-store shoppers are replacing hot grab-and-go items with value-packaged snacks and protein bars purchased in bulk at grocery clubs.

How C-store Habits Are Changing

·       Reducing Grab-and-Go Purchases: Prepared foods are losing steam. Sales of roller-grill items like taquitos and hot dogs are down 8%, while shelf-stable snacks like jerky and trail mix hold steady.

·       Fuel-Only Visits: With gas prices rising, one in four C-store customers are no longer entering the store after fueling — a sharp increase from the 17% recorded just two years ago.

·       Seeking Promotions: Loyalty programs and digital deals now drive more than 30% of in-store purchases, up from 18% in 2021. Successful chains like Casey’s and Wawa are investing heavily in app-based rewards to retain high-frequency customers.

 

What Comes Next: Grocerants and Smaller Meals

According to Steven Johnson, the Grocerant Guru® at Foodservice Solutions®, hybrid foodservice — grocerants — are set to redefine convenience and value. These in-store kitchens serve restaurant-quality meals without delivery fees or tips, perfectly aligned with inflation-conscious households.

Grocerants now account for $43 billion in annual revenue, with growth driven by health-conscious grab-and-go meals, customizable hot bars, and global flavors like Korean BBQ bowls and Mediterranean mezze kits.

“Consumers are building meals around snacks, bundling components, and seeking flexibility,” Johnson says. This unlocks opportunity for:

·       Meal Deals in Grocery Stores: Mix-and-match bundles (entrée, side, drink) that rival fast-food combos in both price and prep time.

·       Snackable Restaurant Offerings: Shareable, snack-size portions — like sliders, bao, and flatbreads — that feel indulgent but don’t stretch the wallet.

·       Cross-Channel Innovation: Think restaurant-branded frozen meals on grocery shelves (e.g., Panera soups, PF Chang’s bowls) or grocery-exclusive LTOs tied to digital restaurant loyalty apps.

 

Final Bite: A Cautious Appetite

While inflation has cooled from its 2022 peak, its legacy still shapes the way Americans eat. The narrowing price gap between grocery and restaurant meals is forcing a rethink — not just of where consumers eat, but how they eat.

From the rise of private labels and modular meals to hybrid channels like grocerants and branded retail products, brands are being challenged to deliver value, trust, and innovation — not just affordability.

As Johnson puts it:

“Success leaves clues. Today’s clues point to smaller meals, smarter choices, and hybrid solutions.”

Are you ready for some fresh ideations? Do your food marketing ideas look more like yesterday than tomorrow? Interested in learning how our Grocerant Guru® 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 one of the following links: Facebook,  LinkedIn, or Twitter