As your insights partner, we want to ensure you always have everything you need to help shoppers live life well fed. View our prepared foods webinar to learn:
- How consumers think about food and the blending of foodservice and retail
- Methods to attract shoppers to the perimeter and appealing to all five senses
- Experiential retailing techniques and a look at what restaurants do well
- The latest flavor trends
Grocery prepared foods are emerging as significant competition to traditional food service—both for takeout and on-premise consumption—particularly with respect to quick-service and fast-casual restaurants.
Deli departments also represent an important vehicle for sales. According to the Food Marketing Institute report “The Power of Fresh Prepared/Deli 2016,” deli sales reached $24 billion in mid-2016, with 58% of dollars generated by fresh prepared. While the grocery industry is struggling to maintain and increase total store sales, the deli department is emerging as a driver of growth, with dollar gains of 4.2% overall and 5.5% for fresh prepared.
The following statistics and observations provided to Nestlé Professional by Datassential suggest just some of the potential:
- 81% of consumers still don’t know what they’re having for dinner at 4:00 p.m.
- 18% are buying more prepared foods this year
- A significant number of shoppers who bought prepared foods at the deli consumed them in the store when that option was available
- 54% typically visit the same store for prepared foods as they do for groceries
- 14% do not buy groceries when purchasing prepared foods—the prepared food is the destination
Because grocerant and prepared food sales are increasingly competing with restaurants, however, deli operators need to keep their game on. That means offering fresh, high-quality prepared foods that address consumer demand for on-trend items like global flavors, prepared-to-order specialties, healthy options, and menu and service amenities that the rest of the food service industry has been practicing for years.
Read on for more ideas for taking advantage of the great boom in restaurant-quality supermarket foods:
- Develop self-service “grab-and-go” prepackaged items that customers can select themselves without having to wait at the service counter. This works for breakfast and lunch—when patrons may be doing other shopping errands—as well as dinner.
- Be aware that in addition to buying complete meals from the deli department, many shoppers are buying components, such as side dishes, dessert, or partially prepared ingredients to supplement a meal they’ll prepare at home. Create bundled options such as ready-to-cook marinated meats offered as a packaged deal with fully a prepared side.
- Provide order-ahead options for made-to-order and deli stations, via internet, app, or even an express order sheet that can be filled while customers are doing their other shopping.
- Offer daily and weekly specials and LTOs (limited-time offers) to keep customers engaged and build repeat business.
- Invest in branded packaging to build awareness, loyalty, and the visual version of word of mouth.
- Pay attention to sustainability issues, such as recyclable packaging, local or ethical sourcing, seasonality, recycling bins for on-premise seating areas, and so on.
- Take a page from quick-service and fast-casual restaurants with combo meals that include a beverage.
- Consider offering meal kits that include both raw and prepared items that provide everything that shoppers need to provide an entire meal for their family.
- Provide recipe cards and other ideas for using prepared foods in other guises that customers can finish at home, for example macaroni and cheese with additional toppings.
- Make sure to offer items that are appealing to the preferences of a wide variety of customers, from adventurous flavor-loving Millennials to picky children to health-conscious adults.
- Food bars and build-your-own concepts such as stir-fry stations allow patrons to customize, control portion size and nutrition choices, and mix-and-match the flavors and ingredients they prefer.
- Spur impulse sales with attractive food displays and appealing merchandising, sampling programs, cooking demos, and special promotions.
- Make sure to provide utensils, napkins, condiments, salt and pepper packaging, sturdy bags or disposable trays, and other accessories required for full enjoyment of prepared foods, on- or off-premise.
- Keep all prepared-food venues and displays clean, well-attended, and well-stocked at all times.
Sources: Food Marketing Institute, “The Power of Fresh Prepared/Deli 2016”; Datassential proprietary research for Nestlé Professional
The information provided is based on a general industry overview, and is not specific to your business operation. Each business is unique and decisions related to your business should be made after consultation with appropriate experts.