Did you know that 65% of Americans are scrambling to figure out what’s for dinner only two hours before dinnertime? The world is more fast-paced than ever, and as a result, a greater number of consumers are looking for expanded options when it comes to quick and easy meals. As a result, new food-on-the-go trends are impacting how consumers shop and eat in a big way.
While quick service restaurant (QSR) sales have long made up the majority of market spend, grocery retailers are quickly closing the gap with their ready-to-eat meal options. The trend of “grocerants,” led by major grocery chains, is taking a bite out of QSRs’ customer base.
Whether you’re operating a grocery store or QSR, you need to understand not only what’s happening right now, but what food-on-the-go trends are on the horizon for the coming year. Dialing into these trends is a critical component of staying competitive in a changing market.
Here’s an overview of what grocerants and QSRs should consider when it comes to creating a strategy to address food-on-the-go trends.
QSRs are evolving rapidly as more technology is changing the landscape. Advents such as touch screens and mobile iPad POS System give customers ordering choices. They don’t need to go to the counter if they don’t want to do so. Plus, the rise of third-party delivery services, like Uber Eats and GrubHub, are making QSR even more accessible. Consumers love that they don’t need to leave the house to get their favorite burger.
To keep pace with other food-on-the-go trends, many QSRs are offering ready-to-serve options that can be purchased with a meal and taken to eat later. These ready-to-serve options include menu items like pre-made sandwiches and salads.
Also, meal kits are gaining in popularity, so QSRs have an opportunity to tap into this added revenue stream. For example, if you operate a Mexican QSR, you could offer a meal kit for customers to make their own tacos or burritos at home.
A significant edge that QSRs have over grocery stores is the restaurant environment, along with consistency in meal options and customer experience. Consumers are loyal to QSRs as they know exactly what to expect each time they visit.
To stay competitive and leverage the current food-on-the-go trends with QSRs, more and more grocery chains are adding ready-to-eat or quick make-at-home options.
Over the past 10 years grocerant visits have increased by almost 30%, with over 40% of Americans surveyed choosing to visit the grocery store for pre-made foods.
These grocerants are hoping to increase sales by getting people in the door for the quick-serve options and then hoping they’ll do additional shopping while in the store. They’re adding a convenient checkout near the ready-to-eat section, which is usually located at the front of the store. Consumers want to be in and out of the store quickly, much like they would be at a QSR.
Grocery stores are gaining market share in the food-on-the-go segment because they’re able to provide a vast number of options. Instead of having to settle on one restaurant that suits everyone, grocery retailers have a broad selection of different food types. Everyone can get exactly what they want, all in one place.
Plus, grocery chains are capitalizing on the trend of consumers wanting to eat fresh and healthy meals by offering options such as salad and sushi bars, sandwiches, and soups.
Best of all, these options are priced competitively. Grocery retailers have the ability to be more agile with price changes due to their access to an extensive network of distributors. Grocerants can offer comparable food at a potentially lower price points. They can also quickly change menu items if the cost of ingredients is no longer reasonable.
As an additional step to break into the quick service market, some grocery retailers are partnering with existing QSRs. In these cases, they are having the brand set up shop in the ready-to-eat section. These retailers benefit from the brand recognition. Consumers who are already in the store may be more inclined to purchase ready-made food from a QSR that’s familiar.
Both QSR and grocery retailers stand out in the food-on-the-go market for different reasons. QSRs offer a restaurant experience and consistency. Grocers, on the other hand, offer more variety and healthy options, typically at a lower price.
For 2020, we expect the following trends to impact both QSRs and grocery retailers.
Both the grocery and QSR options have one key thing in common — speed. No matter where they’re shopping, consumers place great value on a customer experience that’s fast and painless.
The use of touch screens and mobile ordering are already on the rise. At the same time other technologies, like mobile POS and voice-activated ordering are also starting to gain traction.
For example, Chobani uses their mobile POS to take orders, helping to shorten wait times. As a result, sales have increased by 40%.
Everything from inventory control, labor costs and product orders to kitchen technology and WiFi- and Bluetooth-enabled equipment that syncs with smartphones and POS systems can be automated. This saves time and money.
For QSRs in particular, these advances can help streamline operations and deliver a consistent customer experience across the brand in order to stay competitive.
More QSRs will begin looking towards flexible footprint options which are centered on less in-room dining and greater options for express service and mobile pick up lines.
With flexible footprints the goal is to serve more people in less time while operating in a smaller space. It's a departure from the traditional restaurant or grocery store. This may help QSRs compete with grocery stores by being in new locations. It's then easier for customers to get in and out quickly.
To meet the needs of customers who are looking to save even more time, grocery kiosks are gaining popularity. While the concept of “click and collect” has been around for several years, these kiosks aim to improve the overall experience.
For example, QuickCollect uses an automated merchandise retrieval system that’s built into a drive-up station. Customers scan a QR code and their order is delivered as quickly as within 45 seconds.
This speed and convenience rivals drive-thrus at QSRs. Grocery kiosk customers have confidence that they can pick up their order in a matter of minutes without leaving their car.
Today’s consumers are increasingly seeking out experiences over transactions. As a way to compete with bars and restaurants that can offer an experience like watching a sports event or enjoying a live performance, grocery chains are beginning to investigate how they too can integrate an experiential element for customers in their stores.
For QSRs, there’s a new opportunity to be featured in locations where they can be part of an overall shopping experience.
With a landscape that’s rapidly changing, operators are looking at new strategies to grow their customer base. By leveraging current food-on-the-go trends for inspiration, both grocery stores and QSRs can position themselves to stay relevant and appealing and meet the needs of the marketplace.
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