Numbing numbers
Statistics bear out the need for change. NPD Group recently reported that more than half of the meals purchased at the nation’s restaurants are eaten elsewhere. In 2006, the average American placed 127 “to go” orders while sitting down to only 81 meals inside a restaurant. During an analyst meeting late last year, a SuperVALU executive said company research indicated that half of all food is eaten away from home. Of that figure, one-third is purchased on the way home from work.

The numbers are numbing for grocery retailers that, despite the desire to be the answer to the “What’s for dinner” question, seem to be losing ground to casual and quick-serve restaurants that are doing a better job on at least two fronts – convenience and fresh food.

That’s not to imply that supermarket retailers have been juggling cans of peas while the food landscape changed around them. Many have tested new in-store shops and new approaches, and several are recognized by industry experts for changes they’ve made to evolve the business:
Whole Foods wins praise for its prepared foods area, its artful displays of produce and for elevating food shopping to an experience.

Trader Joe’s garners applause for its high-quality, reasonably priced private-label program, an edited assortment that shoppers trust and a commitment to service.

Safeway’s lifestyle stores focus on product presentations that sell solutions to shoppers and the newly opened Citrine restaurant indicates that company executives are willing to spread their wings.

Wegman’s is best described as a food emporium. With in-store specialty shops, cooking classes and – in one store – a restaurant that offers three distinct eating areas, it’s an industry stand-out.

Publix links its success to a willingness to test new things like the Greenwise and Sabor concepts, the Crisper’s chain of restaurants and “Aprons” cooking demonstrations. Now, they’re testing curbside pick-up of phoned in deli orders.

Others that triumph for their inclination to break away from the same-old include Giant Eagle, Bloom, HEB and Kroger.

Jack Horst, an industry expert and a principal at Kurt Salmon Associates, recommends that supermarket retailers figure out which bells and whistles set them apart and focus attention there.

“This will always be a cost-driven industry, so telling supermarket executives that they need to completely overhaul their business will fall on deaf ears,” he says. “I counsel them to appeal to their most loyal shoppers by making improvements to one area that can set them apart from their competition.”

How critical is it for supermarkets to continually evolve their business? According to Horst, 30 percent of existing stores won’t be open five years from now.

“Those who win in this space are those who succeed in turning the chore of grocery shopping into a food experience,” says Wendy Liebmann, president of WSL Strategic Retail. “Shoppers are willing to pay more for convenience, and they’ll pay more for prepared foods. But they won’t pay more for the same-old same-old.

“That’s the challenge supermarket retailers face,” she says. “It’s time they learned how to put food on a pedestal.”

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