I’m leaving for Europe for 2 weeks, and have invited my friend, Steven Johnson from “The Grocerant” to be a guest blogger.
46 Million Reasons Restaurants Should be Concerned:
In three years between 2009 and 2012, NPD reported that the grocery/supermarket sector increased sales of prepared meals by 46 million. That occurred in a short three-year period. Chain Drug stores have taken notice, and continue testing fresh-prepared food at locations from coast-to-coast. As restaurant chain leaders returned to Chicago for the National Restaurant Show this past weekend, they were focused on non-traditional fresh food’s competitive growth.
Restaurant Customer Migration Expanding
Five years from now chain restaurant leaders will still be be attending the National Restaurant Show, networking, learning and laughing aloud about the money they wasted sending employees to Fast Casual Summits. Laughing aloud about how a multi-billion dollar restaurant industry missed the Consumer Marketing Migration that took place from 1999 to 2013. They will wonder how Mintel, NPD and Technomic reported on consumers migrating to other channels, yet they missed it. Five years from now, those same chain restaurant leaders will laugh at the fact that the undercurrents of the evolving face of retail food competition had been all around them. Yet while they practiced brand protectionism, drug stores, C-stores and grocery stores simply catered to the evolving consumer preferences, garnering share-of-stomach, and doing so within in the ready-2-eat and heat-N-eat fresh prepared food grocerant niche .
Five years from now chain restaurant leaders will wonder why they missed it when in 2013 Technomic reported that revenue from prepared foods at supermarkets had increased more than six percent annually during the past five years.
Why they continued to host, speak and pontificate on Fast Casual when the consumer had already migrated.
More important Technomic reported that the prepared food number grows to 13 percent for mass merchandisers and superstores during the same period. The margins on prepared food were expanding, creating a fast-growing new revenue center for fresh-prepared food in this non-traditional fresh-prepared food retail sector.
Looking Outside Current Boundaries
Five years from now all food retailers will evaluate how they do business not how they did business. Five years from now chain restaurant leaders will be laughing how they missed the universal commonalties the drug store, grocery and c-store food marketers did not. Five years from now they will understand that successful competition comes from outside well established operating boundaries.
Five years from now no one will wonder about the findings in a Harris Poll of 2,496 adults surveyed online between February 13 and 18, 2013 by Harris Interactive found that Americans continue to be reducing how often that they eat out at restaurants : Fast food restaurant chain (26% less, 14% more),Local casual dining restaurant (20% less, 14% more),Casual dining restaurant chain (24% less, 11% more),Local fine dining restaurant (21% less, 7% more),Fine dining restaurant chain (23% less, 4% more).
Five years from now all food marketers will understand that channel blurring exist only in the minds-eye of legacy food marketers not in the minds-eye of consumers.
Five years from now Food retailers will understand the 65 Inch HDTV Syndrome Foodservice Solutions® Grocerant Guru Steven Johnson found: The line between restaurants and food retailers is growing ever thinner. The fight for America’s food dollars continues to intensify as consumers find fresh prepared ready-2-eat food options at a wide and growing array of outlets across almost every channel: convenience stores, chain drug stores, restaurants, grocery stores, club stores, vending and even more non-food retailers like dollar stores. While manufacturers, retailers and restaurants worry about choice overload, consumers have embraced their new choices and show no signs of returning to the old ways. This fight is taking place in what is called the grocerant niche.
The restaurant industry is not an industry known for trying to be first as in fastest to market with an ideation, food or technology advance. In the United States the larger the chain in almost all cases the more slowly they are to adopt something than a smaller chain or independent restaurants will. Chain restaurants goal is simple feed one meal at a time in the restaurant while protecting and edifying the brand.
Historically chain restaurant leaders have denied the credibility of start-up competitors as non-relevant. The pizza sector is a great example; evolving from family dinning independents to national chain of “Red Roof” Italian, then to delivery only outlets and now take-N-bake is garnering market share in the pizza sector. (Note: Home Made Pizza Company and Papa Murphy’s are further examples of take and bake pizza operators.)
Future Trends Point to an Increase in Non-Traditional Meal Occasions
Five years from now restaurant chain leaders will understand that packaging advances help create new points of non-traditional food distribution have empowered consumer choice
Trends in the Food Industry Point to an Increase in Non-Traditional Meal Occasions
Five years from now at the intersection of the consumer, fresh prepared food and technology they will have found that consumer eating behavior is evolving and is now beyond the control of traditional food marketers. Evolving culture and lifestyle, demographics along with the new uncertain economy are all putting pressure on the American food consumer: Demands of work, economic shrinkage, demands of raising a family, commuting, social interaction, kid’s after-school activities, all contribute to a food marketplace where convenience vies with price over legacy brands. That one in 10 shoppers choose higher-end cuts of meat in order to recreate a restaurant dining experience (FMI, 2013).
End of Part One. Tomorrow: How Advances in Packaging Aided Acceptance of Non-Traditional Food Outlets
Tags: Guest Bloggers