Restaurant Briefing: Usage of Supermarket Foodservice Evolves
In recent years, grocers and other retailers have stepped up the quality and variety of their ready-to-eat and ready-to-heat prepared foods, also known as retail meal solutions (RMS). Consumers have responded by purchasing these items more frequently: 38% now say they use retailers’ meal solutions weekly, compared to 35% in 2011 and just 22% in 2008.
Shoppers source prepared foods from a wide variety of stores. A little over a third said their most recent purchase was from a general-purpose supermarket; a little under a third bought the food at a mass merchandiser such as Target or Walmart. Others most recently picked up meal solutions from a club store such as Costco or Sam’s Club, an upscale fresh-format supermarket such as Whole Foods, a convenience store or another type of retailer. The majority (55%) purchased the food for dinner, but others bought it for breakfast (6%), lunch (29%), a snack (7%) or multiple meal occasions (3%).
In addition to offering ready-to-eat foods for takeaway, more and more retailers host in-store units of restaurant chains such as Starbucks or Subway; others operate their own in-store restaurants with seating—from Next Door Bar & Grill at Wegmans to Aunt M’s Kitchen at Kangaroo Express. More than six out of 10 consumers say they’ve either dined at or purchased takeout from in-store restaurants. And while national restaurant brands have the edge, almost half of this group have visited retailers’ own-brand restaurants.
WHAT CONSUMERS BUY AND WHY
Although retailers’ prepared-foods sections display a far broader range of offerings than they did a few years ago, most customers stick to the tried-and-true. The RMS item most likely to be purchased on at least a monthly basis is pizza, which 63% say they pick up 12 times a year or more. Prepared sandwiches come next. Desserts, prepared salads, meat dishes (including rotisserie chicken), side dishes and appetizers are all purchased monthly by more than half of RMS customers.
The 95% of consumers who utilize meal solutions from retailers have a number of motivations for doing so. Number one is convenience; shoppers say picking up these items is an easy decision once they’re in the grocery store. Almost half of those who buy RMS items say they do so when they’re short on time or don’t feel like cooking. Many say retailers’ ready-to-eat offerings can be a better choice than a restaurant visit, because a meal from a retailer is quicker (36%), less expensive (27%), or both.
PREPARED-FOOD RATINGS VARY BY SEGMENT
Whether they’re from the deli section or an in-store restaurant, prepared ready-to-eat foods offered by retailers are viewed quite favorably by consumers today. Perhaps unsurprisingly, more than nine out of 10 rank the quality of these offerings at fresh-format supermarkets as high or very high—but almost as many rate ready-to-eat offerings at general-purpose supermarkets just as favorably. Consumers’ evaluations are lower for RMS from other types of retailers (from Walgreens to HoneyBaked Ham), yet almost six out of 10 customers give these offerings good scores for quality. The retailers that really have a long way to go are convenience stores; only 43% of consumers see the quality of c-stores’ ready-to-eat offerings favorably.
Bottom line: Retail meal solutions are a serious and growing threat to traditional restaurants, particularly as supermarkets and c-stores add restaurants of their own. Understanding why consumers are attracted to retailers’ prepared foods is the first step in countering this competition.