When NPD Group reported this week that supper visits to restaurants declined by 650 million, or 3.3
percent, since 2006 we knew what the problem was The 65 Inch HDTV Syndrome.
Retail
foodservice continues evolving at an ever increasing pace with a strong focus
on the consumer. At the intersection of
the consumer, technology and retail food sales we find the grocerant niche
creating and expanding points of quality food distribution. It’s at that intersection that Foodservice
Solutions® Grocerant Guru identified one universal commonality driving
consumers buying pattern changes.
Johnson calls it “The 65 Inch HDTV Syndrome.
The
grocerant niche is the result of the blurring line between restaurants, grocery
stores, convenience stores, and drug stores all selling fresh prepared,
portable, convenient meal solutions.
Targeted at the time-starved consumer with Ready-2-Eat or Heat-N-Eat
fresh prepared food components that are perceived “better for you”, and
portioned for one or two. Consumers like the Convenient
Meal Participation, Differentiation, Individualization / Family Customization
that these retailers offer.
Restaurateurs need to
be particularly mindful of developments within grocerant niche for they are
driving the change within the price, value, service equilibrium in retail
foodservice.
It is at the intersection of the consumer,
technology and The 5 P’s of Food Marketing: Product, Packaging, Placement,
Portability, and Price that retail food sales competition is expanding. Driving
ever greater Mix and Match bundled meal options and new points of distribution
for consumers. Consumers love the
on-the-go options in fact Zaget’s 2013 NYC Restaurant Survey found that in New York at-home meals
surpassed dining out for the first time in 30 years.
Looking
back, during the late Home Meal Replacement frenzy grocery stores, C-stores and
restaurants all studied with excitement the successful developments of Phil
Romano’s Eatzi’s. Eatzi’s is Where Phil
turned the page from restaurateur to foodservice retailer and food
merchant. Phil’s experiment was a
smashing success. It was and remains consumer interactive, participatory with
visceral authenticity recording sales of 17 Million a year at the original
store. Now in NYC Eatley is Eatzi’s on
steroids doing close to 60 Million a year in sales.
Legacy
Home Meal Replacement focus quickly faded away in the Restaurant side of
business. However in the Grocery, C-store and Drug Store sector it continued to
be studied, tested, and implemented. Today the grocerant niche is the strategic
path of choice for non-traditional food retailers, targeted at restaurant
customers, profitable and expanding at an ever increasing pace.
Wawa was once considered a convenience store now they view themselves
as a restaurant with a focus of serving Fast Casual Food- - To Go. At Wawa customers are now finding What’s for
Breakfast, What’s for Lunch and now what’s for Dinner. Sheetz once a convenience store now calls
themselves a restaurant that sells gas. Sheetz
Made To Order food is a hit with customers.
Sheetz is successful contemporizing legacy C-store products with
differentiation, customization and personalization. Consumer like the variety,
24 hour menu serving all day parts - all day long - a wide range of consumer
meal and snacking needs. Sounds and acts
like a restaurant doing all the right things.
Rutter’s is another convenience
store in transition. Rutter’s understands the unique balance between palate,
price, pleasure and the consumer’s drive for qualitative distinctive
differentiated new messaging and Rutter’s is meeting that need set. The food
value proposition equilibrium for the consumer today balances; better for you, flavor, and traditional
products all blended into
something with a twist. In industry
speak, differentiated does not mean different to the consumer it means
familiar. Rutter’s is an example of
brand identity extending beyond consumer expectations within the traditional
conveniences store sector. Too the consumer Rutter’s is a direct valued
competitor within the QSR space.
Food Quality Never
Takes a Step Back. The grocerant niche is driving new competitive points for
food distribution which are a step above consumer expectation in most
cases. Food quality never takes a step
back, these evolving new points of fresh food will continue to improve over
time increasing industry competitiveness. Dunkin Donuts, McDonalds, and Starbucks,
here comes The C-store sector. When
you look at the menu items offered by these legacy conveniences store operators
it is clear to see that the grocerant niche is a platform that is creating
equilibrium. In other words they are
not discouraged or intimated by competition from any sector.
They
understand that the grocerant niche is a result of the blurring of the line
between restaurants, grocery stores, convenience stores, and drug stores all
selling fresh prepared, portable convenient meal solutions. Targeted at the time-starved consumer with
Ready-2-Eat or Heat-N-Eat fresh prepared food components that are “better for
you”, portable and portioned for one or two. All of these operators want a
larger share of the retail food market. They want to take share from the restaurants.
During
Transformational period’s legacy industries are at times forced to expand at a
pace unseen in decades. The grocerant niche is contributing too redefining the
retail foodservice experience. The Ready-2-Eat & Heat-N-Eat fresh and
prepared food niche is expanding rapidly within the grocery sector. Whole Foods
is no longer Whole Paycheck but Whole Fresh Food Fast and consumers find that
is “better for you”.
Whole Foods is
driving customer frequency while building loyalty with Fresh prepared
ready-2-eat and heat-N-eat better for you food. Whole Foods focus is on
convenient meal participation, better for you differentiation, and
individualization.
Safeway’s has
integrated Mix and Match Meal Bundling marketing into daily and weekly iphone
app’s and legacy print flyers. With a focus on Fresh Prepared Food, Safeway is
leveraging The 5 P’s of Food Marketing: Product, Packaging, Placement,
Portability and Price establishing contemporized consumer relevance. In what
was once restaurant food space alone grocery stores, C-stores and Drug stores
are now garnering consumer attention.
With
powerful well Financed companies the ilk of Walgreens entering the fresh food
space that is something no food retailer should dismiss as not my competitor. Walgreens with over 78 Billion in sales they
can try and try again. Walgreens might just be the next Next Biggest Competitor
in the retail food space.
It
must be noted that Walgreen’s all but exited retail food service when they sold
their last Wag’s restaurant. We all must
remember at one time Walgreens was a tier one fresh food retail operator /
restaurant. Ready-2-Eat and Heat-N-Eat fresh food runs deep in the legacy of
Walgreens.
Walgreens Fresh with Duane Reade have 7,500+ retail outlets. Who is selling what in your back yard? With Walgreens
entering the fresh food area again with meats, wraps, soups "and other
on-the-go meal options, as well as convenient alternatives for tonight's family
meal, it is clear that the future of fresh food retail leadership may be up in
the air.
Food Retailing
Never Takes a Step Backward. Consumers
are dynamic not static always looking to save both time and money. The grocerant niche is propelling new quality
points of fresh food distribution and competitors that are well financed.
Steven Johnson is Grocerant Guru at Tacoma,
WA based Foodservice Solutions, with extensive experience as a multi-unit
operator, consultant and brand/product positioning. Since 1991
Foodservice Solutions® of Tacoma, WA has been the global leader in the
Grocerant niche for more on Steven A. Johnson and Foodservice Solutions® visit http://www.linkedin.com/in/grocerant
or twitter.com/grocerant
