In part 1 of our two part series, we looked at the evolving strategies of food-to-go specialists. In part 2, we consider the strategies and opportunities at play for retailers, in what promises to be a key year for food-to-go development.
1. Targeting better food-to-go solutions
We’ve long seen a key route for broader growth for food retailers of all sizes as lying in improved / upgraded food-to-go offerings.
And there are multiple opportunities for further development of the in-store food proposition across supermarkets and convenience stores. Even within core ranges there are significant opportunities for upgrades – not least as Levantine and a variety of Asian cuisines rise further up the consumer agenda. We also see opportunities in tapping into the reimagination of what would be traditionally pigeon-holed cuisines – kebabs and Indian food also hold significant growth opportunities, whether as standalone concepts or within core food-to-go ranges. In grab & go propositions, we're seeing emerging, higher quality, FMCG focused brands encouraging retailers to stretch their price architecture upwards. Critical here is having the right environment and communication to support this.
Given the shift in roadside dynamics, this opportunity applies equally, if not more so, to forecourts. The roadside market will develop significantly over the next 12 months, not least as more foodservice businesses follow the example of Loungers in the UK in targeting the opportunity.
2. Collaborating more - in new ways and with new partners
For any retailer, a starting point should always be considering relative strengths and weaknesses and how they apply to different food-to-go solutions. Increasingly, collaborating with specialist partners is a key route through which to compensate for weaknesses, and in some cases accelerate and expand strengths.
Clearly, this collaboration can take many forms - we look at the activities of the likes of WH Smith Travel, Monoprix in Paris and - slightly further afield - GIANT in Philadelphia as providing great templates of how this can work to deliver an enhanced and more impactful solution for food-to-go consumers. Similarly, the collaboration of LKN with Asda in the UK, and Noahs with Meny in Denmark, where it will open smart kitchens within selected Meny stores, are among the key developments to watch. Ultimately the role of the store and the expectations of what it can deliver are changing: new partners will have an increasingly critical role in defining its success.
3. Searching for the next sushi
Sushi's success for many food retailers, and supermarkets in particular, is giving rise to thoughts about what could be next. The first consideration here is that the dynamics of sushi differ from most other solutions, so there's no single catch-all solution. Simply put, preparing sushi freshly on site is probably perceived by customers as making a bigger difference to the end product than for other dishes, cuisines and products. We’ve seen several attempts to develop this, but few that have yet shown scalability to anything like the same extent as sushi.
But there are opportunities. Asian bowls - including but not restricted to poké - are one area, another lies in Levantine / Middle Eastern cuisine. With this in mind, we’re looking closely at the expansion of Babacous in Germany and the Netherlands, as well as the Eat Happy sub brand Lovante. As the influence of food halls continues to grow, and more consumers are more exposed to a wider range of cuisines, new opportunities may emerge, so we’d encourage any supermarket operator to keep one eye on this development and regularly review the approach.
Of course, it’s important to remember that the next sushi could indeed be more sushi: it’s a good fit with wider consumer trends around healthier and lower meat diets, and, although commonplace in key cities, there are substantial opportunities beyond this.
4. Considering how food fits in future retail missions
The question of what the supermarket of the future looks like is an important one. From a food retail perspective, what’s increasingly clear to us is that the traditional aisle approach of supermarkets could and would benefit from a rethink, particularly for those retailers targeting a more aspirational and inspirational positioning. This often hides products rather than showcases them, and can end up being a lowest common denominator for presenting products – often making it harder to differentiate unique, special occasion and premium lines from basic everyday ones. For us there’s a real opportunity to think differently about the store to unlock new opportunities - Dom's Kitchen & Market in Chicago is a great example of a store where the whole flow and purpose of the store has been reimagined to more easily integrate a range of foodservice missions. Of course, there are many other examples, not least in Ireland, where this thinking is very much underpinning latest developments. This thinking from Ireland has been brought to London, via the new look Kavanagh's store in London's Belsize Park ( below).
5. Balancing experience, uniqueness, value and profitability
This, clearly, is the ultimate goal, but again for any food-to-go operation to deliver this, whether in a retail store or a food-to-go/ foodservice led environment, it probably requires a combination of thinking from both retail and foodservice. There's a blueprint to be created around how to best run and develop a food-to-go proposition in a retail environment, and we'd encourage retailers to take a broad view - and talk to their food-to-go specialist partners and contemporaries to help deliver this. One aspect we'd call out is around setting and delivering to customer expectations - it need not be an issue if you don't have a full range in place all the time, as long as you communicate this effectively. Another is around the added services - if you're keen to attract customers through the quality of your food proposition, remember how many consumers will judge food outlets on what could be seen as non-core aspects, such as the cleanliness/ availability of toilets for example. And of course, the seating area is a point we often call out. and it's one where there's a trade off, but a considerable opportunity to use this to set and reinforce overall brand values. All in all, lots going on and lots of potential for those who build their approach on the right pillars. Get in touch if you need our support and good luck!
We've only scratched the surface in this article, there's a lot under way and a lot of opportunity. To find out how we can help you capture more of that, get in touch email@example.com.
2023 promises much for retailers and suppliers that are prepared to push the boundaries. Both the fuller report and our wider consultancy based insight services (whether retail safari based or not) can help you to understand the direction of the market and your best opportunities therein.
And if you want to hear about the latest trends, and learn from a fantastic case study of a retailer that is thriving in the food-to-go space, Scotmid, then join our next RATIONAL webinar on January 31.
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