Ahead of our next RATIONAL webinar with BWG’s Declan Ralph next Tuesday (22nd September), we consider some of the key themes currently impacting those targeting growth in food-to-go.
1. Strengthening destination status. Across many markets we’re still seeing consumers showing caution over visiting more outlets than they need to. Moves such as Pret looking to target take home dinner, and convenience stores accelerating their focus on coffee, make increasing sense in this context. Expect therefore that more of those businesses - across convenience and broader food-to-go - that haven’t previously committed to a strong coffee offer to take it more seriously going forward.
2. Increasing the focus on health. As a consequence of living through a pandemic that hits the least well the hardest, consumers are on the lookout for products that deliver health benefits. Oranges, for example, have seen phenomenal increases in demand across US retail. Many food-to-go ranges are still in the recovery stage, but even with edited ranges, it’s key to ensure there’s sufficient representation of healthier lines in the offer, and crucially that these lines are effectively signposted.
3. Creating and communicating differentiation in food-on-the move more strongly. There’s a new competitor in the food-to-go market – the food refrigeration unit located in people’s homes. Getting into these fridges via larger shops is undoubtedly one route to accessing this market, but another is better targeting those meal solutions that aren’t quickly and easily replicable at home. Hot prepared solutions is an important route through which to achieve this, and there is undoubtedly a broader opportunity – across hot and cold – for unique and differentiated recipe combinations.
4. Reassessing the potential of different locations. For retailers and food-to-go operators with multiple units and locations, it’s time to reassess the food-to-go potential across the estate. More homeworking appears set to stay with us for a while, and the downturn in city centre footfall is well documented. But the flipside of this is that locations that traditionally had minimal food-to-go potential have new opportunities. It also means that those food-to-go and coffee operators in more suburban and rural locations may need to shift operating models to take advantage. A further aspect of this opportunity is how food delivery can support new growth, alongside careful consideration of the mechanics of the online ordering system that sits behind this.
5. Building a unique approach to demonstrating value for money. Simply put, income levels for many consumers will drop, with clear read throughs for disposable income – and spending on discretionary areas. And while the simple answer to this in food-to-go is to cut quality, for many that will be the wrong one right now, where building beacons around your points of difference is more important than ever. Meal deals and loyalty schemes are among the routes that can be used to deliver this value, while the subscription model, being tested by Pret and Leon, is another. A third one is smaller portion sizes, being tested by Costa in the UK in coffee.
So what's next? Though the outlook undoubtedly has big clouds hanging over it, opportunities remain, and the relative affordability of food-to-go represents a strong selling point. It will be crucial however to drive the right combination of value for money and loyalty. Don’t underestimate the importance of relationships, the heightened desire to support local and community and the goal of providing the customer with an experience to take away with them – as well as simple product - as components of this new value for money equation.
Hear more about these themes and the evolving food-to-go landscape in our webinar. Click here to reserve your place for the session taking place at 3pm UK & Ireland time, 4pm CET on Tuesday 22nd September.
Photo source: Kauai Netherlands