Retailers closing gap with restaurants, says Technomic

CHICAGO (May 20, 2010 - Business Wire)—Retail food outlets in a variety of segments have significantly stepped up their efforts to provide new, appealing, and competitively priced meal solutions to consumers, putting themselves in an excellent position to compete head-on with restaurants. With better quality and more variety, consumers now have a wide array of options that simplify and speed up meal preparations, making it increasingly easy to pass on dining out.

Evidence of the shift was found across nearly 20 product categories, according to recent research conducted by Technomic for its RMS (Retailer Meal Solutions) Monitor intelligence service.

\While rotisserie chicken, macaroni and cheese, and deli salads remain a substantial part of the mix, they are by no means the sole anchor to capture consumer attention and dollars.

"From Korean-style barbecue, Hispanic baked goods and Mediterranean salads to gourmet versions of retro Americana sides, made-to-order specialty sandwiches and chicken wings in a host of flavors, it's immediately clear that 'deli' doesn't do these offerings justice," says Jenny Anderson, Manager of the RMS Monitor project.

According to Anderson, while "retailer meal solutions" is an accurate label for this broad collection of products, retailers are using other terms and marketing messages to promote their prepared foods offerings to consumers. Positioning options and examples include:

Restaurant Quality at Home: Restaurant trends are migrating to RMS more quickly and it is not just upscale markets that are incorporating ingredients, flavors and preparation techniques proving popular in restaurants. Retailers can now justifiably market their prepared foods and other items as restaurant alternatives with lower prices and do so frequently. Examples range from c-stores like Quick Chek (“Restaurant Quality, No Reservations Needed”) to chef-inspired meals from Safeway’s extensive Signature Café program and Walmart with its new Marketside brand.

Restaurant Dining In-Store: Retailers are also marketing the stores as restaurants and offer onsite dining to further blur the lines between foodservice and retail. Kroger features many of its RMS items in areas called The Bistro. For Hy-Vee, a foodcourt is among the store departments. Others have taken it to the next level with distinctive in-store dining concepts like The Pub at Wegmans and the many diverse dining concepts from Whole Foods (e.g., Italian osterias, wine and tapas bars, diners). The availability of alcoholic beverages adds to the complete dining experience.

Besides a stronger emphasis on quality, retailers are also tapping into consumer stresses and concerns to more effectively position RMS offerings as true solutions that fit consumer lifestyles.

Convenience without Sacrifice: Removing the “chore” of cooking and freeing up that time for something else is another key appeal for RMS. Perusing prepared foods sections that offer complete meals also eliminates the stress of planning what to make. Lunds & Byerly’suse the tagline “Great Food Fast” and other examples abound, including “Easy Meals” at Giant Eagle.

Better-For-You without Effort: Another area where retailers are taking a cue from restaurants is in marketing healthy meals. Fresh & Easy, Market Street and others now offer specific lines of healthy options to help consumers maintain a healthy diet without having to calculate calories and fat or seek out good-for-you ingredients. In addition, offerings priced by the pound are very common and have been promoted as an option that gives customers more control over portion sizes, which also taps into budget-minded concerns about food going to waste.

Technomic's RMS Monitor provides monthly news and commentary on new products and services, retailer expansion and remodeling that is fueling expanded availability for RMS, "hot" concepts and noteworthy trends, and a best-in-class retailer profile. The program also provides quarterly studies on special topics that have included original consumer and retailer research.


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