• Turning shoppers into diners: What’s driving success at retail foodservice

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    The line between restaurants and grocery retailers is getting increasingly faint as more supermarkets add prepared foods and foodservice concepts. Most major supermarket chains have revamped their prepared food offerings to offer much more than rotisserie chickens and a salad bar, and it’s safe to assume that “grocerant” concepts will continue to evolve to suit shifting consumer needs.
    Americans now spend more on restaurants than on groceries, according to data from the US Census Bureau, and prepared foods present an opportunity for grocery retailers to recapture sales lost to restaurants and connect with consumers on a new level. Here’s a look at what’s driving foodservice sales at retail and strategies that can lead to further success.
    Convenience is key
    One of the driving forces behind the consumer shift to eating more meals prepared away from home is a need for convenience. Consumers often don’t have time or don’t want to prepare meals themselves, and they are increasingly opting for food that fits into their schedule. Eighty percent of consumers say they purchased prepared meals at least once a month in 2017, according to Bret Yonke, manager of consumer insights at Technomic.
    Despite rising demand for delivery, trips to the grocery store are still routine for the majority of consumers -- 99% of online grocery customers still go to brick-and-mortar stores to shop for groceries, according to a recent NPD survey. By offering convenient food options where consumers already are, supermarkets can capture sales that could be lost to shoppers stopping on the way home from the grocery store for a bite to eat or planning to order delivery when they got home.
    Consumer purchase behavior underscores the importance of convenience to shoppers, Mintel’s Associate Director of Foodservice Research Amanda Topper said during a presentation at the National Restaurant Association Show last month. Coffee and sandwiches are the most popular purchases in supermarket prepared food sections, and 49% of consumers said they buy prepared chicken (fried or rotisserie) from the supermarket.
    Chef-driven menus stoke shopper interest
    Chicken and coffee may be the top sellers now, but as grocerants become more commonplace supermarkets would do well to offer new items that play into food trends and consumer demand for variety.
    “Moving forward, [Retailer Meal Solutions] operators will need to continually surprise consumers with signature offerings -- think poutine bars and mochi ice cream -- in order to maintain a loyal following and differentiate themselves from local competitors,” Technomic’s Yonke said.
    “At this point, most major banners have hired a corporate executive chef to run foodservice,” he said. “Many of the most advanced RMS programs – especially local banners that have maybe 5-20 stores -- may even have executive chefs in each (or most) stores.”
    A ShopRite store in Englewood, N.J., took its foodservice operation one step further by having a separate kitchen and sushi counter for kosher offerings, NorthJersey.com recently reported. The store hired a chef dedicated to overseeing kosher cooking and plans to expand its kosher catering business.
    Having an in-house chef can boost consumer perception of supermarket prepared foods, and visible prep areas can help with this as well. The fact that shoppers can see foods being prepared gives an overall perception of freshness, Mintel’s Topper said. Mintel research found that consumers associate freshness and healthiness with retail prepared foods even more than restaurant foods.
    Experiences forge connections, drive return visits
    Freshness, convenience and on-trend flavors can help supermarkets turn shoppers into diners, but offering experiences is key to driving repeat visits.
    “Recurring weekly specials, such as discount taco Tuesdays, can drive repeat traffic and cement prepared foods into consumers’ weekly routines,” Yonke said.
    Mintel’s research also found that specials are important to driving repeat business. About 40% of consumers said samples and specials were top factors in motivating purchases, Topper said.
    Beyond specials and samplings, classes and social events can also help bring shoppers back to the store. Two in five consumers say they are more likely to shop at a store that offers an experience, Mintel found.
    “Events like wine tastings help to provide a deeper level of engagement with consumers,” Yonke explained.
    Mintel research found that only 10% of consumers are interested in seeing bars at the supermarket, Topper said, but she expects interest to grow as grocerant concepts become more mainstream. Bars, dining areas and other gathering places are already turning supermarkets into a destination for consumers – Mintel found that 25% of shoppers said they would spend time at a grocery store even if they weren’t shopping.

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