1. Department: Food

The Service Deli Selling Grocerant Meals and Meal Components Might Save the Grocery Sector

 

Grocery
stores are having a bad time stocking the shelves with products legacy food
manufactures want them to sell.  Grocery
stores the ilk of Kroger and Publix like the slotting fees legacy food
manufactures pay.  In fact, according to Steven Johnson Grocerant Guru®
at Tacoma, WA based Foodservice Solutions® “slotting fees” are the as bad for
grocery stores as heroin is for a junkie.”

Grocerant
niche meals and meal components are driving customer migration within every
sector for food retail today.  Grocery stores
to win the battle for share of stomach must focus on what the customer wants
rather than what legacy food manufactures want. Let’s see why that is:

1.       Recent Grocerant ScoreCards found 82.3% of consumers
don’t know what’s for dinner at Noon, and 61.8
% don’t know what’ s for dinner at 4PM.

2.       68.2 % of consumers would order
alcohol with a meal or meal components from a restaurant if available when
ordering.

3.       Roughly 63.7% of consumers purchase prepared food items from a
retail location at least three times a month.

4.      
79.6% all dinners have at least 1
grocerant niche Ready-2-Eat and Heat-N-Eat meal component and 66.6% have two
meal components per day.

5.       When asked if
they wanted to cook dinner from scratch or assemble dinner from fresh meal
components 91.3 % of Gen Z chose assemble from Fresh Prepared Meal Components
and Millennials 83.4% chose meal components.

6.       Seventy-three percent of retail prepared food purchases are taken
to go

7.       88.2 % of consumers prefer hand held food over sit down meals with
a knife and fork

Do you Want a 

Larger Share of Stomach?


There is no doubt that inflation continues to drive up costs and retail prices in
deli fresh and across the store. Customers still gravitate towards convenience
items, but now the focus is more on value.

We
all know that during the pandemic, deli fresh sales were down 36.2% according
to the National Grocers Association. But within the last 12 months, deli fresh
sales have increased by over 60%, underscoring the demand in the category.  Here are more facts from a recent article:

“As
we move past the pandemic, customers also demand a better shopping experience,”
said Tony Phi Dang, corporate executive chef of Southern California-based
Gelson’s Markets. “More people are shopping in person again, so smart
merchandise displays and enhanced in-store dining experiences affect where
people choose to shop.”

“Our
cold-prepared salads and meals have seen a dip in sales volume in 2023 after
reaching a peak during the pandemic,” Phi Dang added. “Prepared meals in our
grab-and-go cases are higher than pre-pandemic sales but have dropped as
customers slowly return to shopping in person. Salad bar and hot foods
sales have increased over pandemic numbers but have not returned to
pre-pandemic numbers.”

Chris Mentzer,
director of operations for Rastelli Market Fresh, which has two New
Jersey-based locations in Marlton and Deptford, said lines are back in the
deli for fresh items, though shoppers are keeping an eye out for items on sale.


“It’s
one of the categories that is back at full-speed and sales are outperforming
last year’s numbers for us,” he said. “We have a specialty flare to our store,
so we try to challenge our customers with new products, such as fresh-roasted
and fresh-smoked meats and pork loins for lunch meat.”

Whitney
Atkins, vice-president of marketing for the International Dairy Deli Bakery
Association (IDDBA), noted that the organization’s “Guiding Trends for 2023” —
“Whole Heart, Whole Self and Whole Heart,” “Consumer Defined Convenience” and
“Worth the Value,” reflect the countless opportunities for deli fresh to
increase sales again.

“Consumers
want to be able to gather a healthy, quick meal or perhaps indulge in a fresh
prepared salad,” she said. “Deli fresh meal solutions naturally create
incremental bakery sales like rolls or dessert or even cross departmental sales
like produce salad mix and grocery salad dressings.”

Jonna
Parker, team lead, fresh at Circana, noted food decisions today are dominated
by affordability. However, consumers are still weighing convenience, health,
taste, and experiences into their decisions, as well.


“There
is great recognition that in comparison to restaurants, fresh deli-prepared
foods deliver on a lot of these demands,” she said. “The key is being on the
radar for those times the consumers decide to leave the meal prep to someone
else.”

In
vogue 

David
Henkes, senior principal and head of strategic partnerships for Technomic,
which advises supermarkets on business growth, noted pizza and value-added meats
such as rotisserie chicken, pulled pork, and ribs have been among the top
performers in the deli fresh category in 2023.

“Pizza
has benefitted from the fact that major pizza chains have faced challenges in
terms of ingredient availability and pricing,” he said. “Breakfast pizza has
also been emerging for some grocers as they try to develop the prepared
breakfast daypart. Value-added meats have also been comparably affordable as so
many traditional foodservice operators have been charging much higher prices
for protein-based dishes in the past years.”

Erin
Rector, senior account manager, food safety and quality for the global food
division at NSF, noted that grocery retailers are responding to the deli
fresh trends of meals that are already cooked and assembled, as well as meals
that simply need to be heated up for the customer to prepare. Retailers are
additionally adding hot-holding packaging so that the consumer can easily
prepare the meal and eat it from the same package.

“Stores
have also prepared more options for customers to purchase and quickly cook when
needed,” Rector said. “They have also increased options so that busy families
can accommodate all of their family members’ dietary needs.”

At
Gelson’s, its albacore tuna and herb salad has been a crowd favorite this year,
and premade sandwiches and prepackaged salads are also at the top of the list
for sales.

“Customers
love the familiar, high-quality, and consistency of our gourmet salads and
grab-and-go meals,” Phi Dang said. “We have expanded the variety and number of
options available over the last few years. We continue to work on developing
new recipes for meals to keep the category fresh.”


Savvy
displays

It’s
as important as ever for stores to catch the eyes of its shoppers to entice
them to the fresh offerings, and that can be accomplished in numerous ways.

“Cross-merchandising
products from our regular deli and meat departments have been mutually
beneficial,” Phi Dang said. “A beautiful cheese plate beside our prepackaged
salads might entice customers to buy both items. Fresh and full-looking gourmet
salad displays also attract customers to the kitchen.”

Gelson’s
has also updated signage in all of its store entrances to show what deals will
be in the kitchen and throughout the fresh department. 

Most
customers are already loyal to their favorite grocery store and their deli
department. The key for increased sales is to promote deli fresh within the
store using directional signage, beautiful displays, and an adequate stock of
products.   


“Samples,
combined with limited-time specials, can prove to be effective for the deli
fresh department,” Mentzer said. “That’s been very beneficial for us.”

And
with back-to-school season now here, deli fresh offerings are expected to
finish the year strong due to their convenience.”

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 participationdifferentiation,
and individualization?
 Email us
at:
[email protected] or visit: us on our social media sites by
clicking one of the following links:
Facebook,  LinkedIn, or Twitter

View Original Article
Do you like Grocerant Guru's articles? Follow on social!