Fresh Fast Famous Virtual Restaurants Leave Legacy Chains Restaurant Languishing

 

At the intersection of food trends, consumer eating patterns, and technology Gen Z and Millennial consumers have disrupted traditional avenues of fresh food distribution because they were two slow to evolve according to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.

There was a time that independent local restaurants embody the American ethos of menu creativity, distinctive flavor profile, and were the fastest to respond to a change of operating circumstances. Chain restaurants would watch what worked for independent restaurants, see what consumers (liked) were buying elsewhere then copy it, advertise, and regain market share. They the chains would spend big dollars promoting “copycat’ menu items to drive sales. Those days seem to be gone according to Johnson.

Consumers in search of food discovery have changed all that. Restaurant chains once nimble focused and quick to respond, have been “simply watching from the sideline” according to Johnson as virtual restaurants garner the attention of consumers.  It would appear that many legacy chain restaurants are waiting for the days of old to return. The facts seem to show that they simply can’t keep pace with all of the new entrants disrupting the landscape of food consumption.  Many chain restaurants reeling from the pandemic, don’t want to move forward they appear to want the old days to return.  Good luck with that.  They wonder what or who’s coming after us next?  Let’s take a look.

In a Battle for Share of Stomach

Are you a 'Player'

Well, here is one person that is; content creator, musician, and YouTube sensation Larray recently announced the launch of his very-own virtual restaurant brand called Larray’s Loaded Mac. 

So, as one of the fastest-growing, multi-hyphenate creators worldwide, Larray’s music, style, and vibrant personality have captured audiences globally and resulted in a loyal following of fans and nearly 40M followers across YouTube, TikTok, and Instagram. Now, Larray is adding restaurateur to his digital profile as he debuts Larray’s Loaded Mac in partnership with Virtual Dining Concepts (VDC).

Robbie Earl, VDC co-founder, “We are focused on working with digital-first talent by helping them create an ownable virtual dining brand,” … “By tapping into the creator economy, we’re not only playing a part in growing the influencers’ personal brands but also further helping the restaurant industry leverage the digitally native community.

Having Larray join the virtual food space provides him with another way to engage his fans, this time with food deliveries in 30 minutes or less, and have them be a part of something that means so much to him.”  Johnson asks, can your restaurant or food outlet deliver your grocerant niche Ready-2-Eat or Heat-N-Eat fresh prepared meals or meal components in 30 minutes?

New networks of “virtual chains” are emerging, for example, as explained in the New York Times, when a customer ordered from the MrBeast Burger in Midvale, Utah, the food was prepared at a Buca di Beppo location following a standardized MrBeast recipe.  

Virtual Restaurants, virtual kitchen, or ghost kitchens now reflect the American ethos of menu creativity, distinctive flavor profile, and are fastest to respond to a change of operating circumstances more important they have become food marketing powerhouses driving customer adoption. Johnson, went on to say they are doing that while simultaneously building a brand and evolving a menu.

Driving down the cost to start a brand or open a restaurant, essentially, virtual restaurants have no physical storefront. Cooks prepare food for delivery or take-out, and no dine-in options are available to customers. Virtual restaurants typically leverage websites, social media, and various third-party apps to reach their customers and offer alternative means for restaurants to continue operations and generate much-needed revenue.

Food marketing trumps a physical location aka a store front as digital technology via a mobile smart phone is in the hand, the pocket, or on the ear of 85.7% of the U.S. consumers. Virtual restaurant branding is driving by creative food marketers use of descriptive names.  So while, Millennials and Gen Z are seeking fresh food fast. Marketing and technology matters because limited screen space and time to engage with potential customers, a brand name that not only identifies the ghost kitchen but also highlights the available fare could be the difference between a sale and a customer’s continued scrolling.

The question today has become not who is our competition, but rather how fast will competitors be coming after us.  Then what are you going to do about it when they come? If success leaves clues and it does it clear that the grocerant niche filled with fresh prepared food that is either Ready-2-Eat or Heat-N-Eat is set to ramp up once again. 

Are you ready for some fresh ideations? Do your food marketing ideations 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

Grocerants The Undercurrent of Foodservice Sales Growth

Back in the day, say during the mid-1980’s Home Meal Replacement was the talk of the retail food industry.  What many legacy grocers failed to understand was the opportunity for fresh prepared food as a daypart meal opportunity.  They could not understand it because they were not really in the meals business. Even more important they didn’t want to be in the fresh prepared meal business according to Steven Johnson, Grocerant Guru® with Tacoma, WA based Foodservice Solutions®.

Grocery retailers back in the day thought that Home Meal Replacement specifically in store fresh prepared food cost too much to produce. They believed that it threw their labor out of line, created scheduling problems, and had too much waste.  Many still believe that today.  I guess that’s why most grocery stores have failed meet the needs of today’s consumers.  

They simply did not want to deal with fresh prepared food.  So, they cut corners, mass produced product that they called fresh, packaged it like it was a CPG brand, and let it sit on display or under heat lamps way too long.  In short, they blew it, and many still are doing it wrong. So, let's look at five facts that today are turning consumers in grocerant niche consumers.  Here they are:

1.       11% of consumers say convenience is most important in products they eat, up from just 7% in 2013, according to The NPD Group. 

2.       53% of all eating occasions include a desire to avoid spending the time and energy it takes to cook, according to The Hartman Group. 

3.       80% of meals eaten at home are sourced from the pantry or the freezer, according to The NPD Group. 

4.       44% of consumers say they are deliberately trying to avoid artificial color/dyes in their daily diet, according to The Hartman Group

5.       91% of U.S. consumers believe food and beverage options with recognizable ingredients are healthier, according to Innova.

Then they went back doing what they always did, and doing it the same way.  One problem consumer’s are dynamic not static. The grocerant niche continued to grow around the world and our Grocerant Guru® was there helping clients in the U.S., Asia, and Europe are drive top line sales and bottom-line profits with incremental customer adoption.  

Foodservice Solutions® Grocerant Guru® has repeatedly stated that “consumers never take step back in food quality or freshness”.   The food retail industry today is no longer at a crossroad.  The consumer has moved.  It’s simply a question for legacy grocery retailers if they want to move forward with consumer or not. 

It used to be restaurant chefs were the industry tastemakers and retail eventually playing copy-cat caught up with the trends. Today, many tastemakers come from Grocerant niche retailers. Driven by increased demand and customer migration from cook from scratch to Ready-2-Eat and Heat-N-Eat fresh prepared food.

Everyone from Soccer Mom’s to Senior Citizens are putting pressure on retailers for fresh prepared food.  All retailers are in a fierce battle to garner a larger share of stomach and the battle ground for customers is taking place in the grocerant Ready-2-Eat and Heat-N-Eat fresh prepared food space.

Grocery stores continue to play catch-up resting with the rise in food sales due to the pandemic.  However we all know that will not last forever, The convenience store sector focusing on Grocerant niche Ready-2-Eat and Heat-N-Eat fresh prepared food companies the ilk of Wawa, Sheetz, and Rutter’s Farm Stores are all garnering new customers from other legacy channels of fresh food distribution including grocery store and chain restaurants.

Grocery stores over the past decade have lost sales and customers fast food restaurants, C-stores, and dollar stores that have driven Take-Away, Take-Out Grocerant niche Ready-2-Eat and Heat-N-Eat fresh prepared food from 5% back in the day to near 35% of sales today. 

Trapped in footprint malaise traditional grocery stores are in a time-warp and quagmire of their own creating, capitulating business and it’s time for a new view, and new business model, the grocerant model where mix & match meal component bundling has become a science.  

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 Foodservice Solutions® of Tacoma, WA has been the global leader in the Grocerant niche. Contact: Steve@FoodserviceSolutions.us or 253-759-7869