A New Consumer
Published in CSP Daily News
Innovation, creativity crucial to lure today's diner, FARE panelists agree
SCOTTSDALE, Ariz. -- How do you attract a consumer who has been changed--permanently--by the recession? It's not just about price. Consumers want value. They want an experience. Some of them want it "healthy." And they want you to offer what they want when they want it.
That was the sentiment agreed upon by the participants in the "Trend Translations" general session on the closing day of FARE (Foodservice at Retail Exchange) in Scottsdale, Ariz.
Moderated by Abbie Westra, executive editor of Fare magazine, the session featured presentations from Bonnie [image-nocss] Riggs, restaurant industry analyst for Port Washington, N.Y.-based The NPD Group; and Kevin Higar, senior manager for Chicago-based Technomic Inc.
Riggs, who has been tracking the restaurant industry since 1976, said this recession was different from any other because it has forever changed the consumer's mindset about purchasing. In previous recessions, shoppers went back to their old ways. Not this time. And that means the battle for market share will continue, Riggs said.
The good news for c-stores is that they are positioned to lead retail overall, with NPD predicting double-digit growth through 2019 for the channel. The challenge for all slices of retail will be figuring out how to keep the aging baby boomers, all 76 million of them, seeking out their locations for meals; and how to cater to the finicky, 52-million-strong Generation Y, who are moving into their "heavy restaurant years."
"You won't be able to reach them in traditional ways," Riggs said.
Translating the facts and figures introduced by Riggs and Higar were last year's Leader in Retail Foodservice award winners: Byron Hanson, director of deli operations and foodservice for Lund Food Holdings Inc.; Steve Hammel, dining services program manager for Navy Region Southwest; Ken Toong, executive director of auxiliary enterprises for University of Massachusetts Amherst; and Jerry Weiner, vice president of foodservice for Rutter's Farm Stores.
[Pictured (left to right): Higar,Riggs, Toong,Hammel, Weiner, Hanson.]Hanson of Lund Food Holdings stressed the importance of "critical price points," citing the ripple effect of Subway's $5 Footlong on all retail operations. His Byerly's stores introduced "Five Buck Cluck" (a $4.99 rotisserie chicken) and saw sales of the fowl increase tenfold. That led to five-buck sushi on another day of the week.
"You have to make it an experience for them to come and eat," said Toong, whose 40,000 students and faculty he likened to "a city" he has to feed every day.
Introducing a "blue plate special" type of meal worked at Hammel's Pierside Cafe concept. The idea was so popular that the cafe went from being the "home of the $5 lunch" to the "home of the $6.95 lunch"--with no complaints about the price increase, he said.
Factors such as hospitality and ambience, unique items and menu desirability matter a great deal to today's consumer, Higar said. An example of a quirky, fun offering he discovered: the Blow Pop Martini from the Sugar Factory in Las Vegas, which features a lollipop in the beverage and Pop Rocks on the rim of the glass.
That menu desirability also translates to offering certain items around the clock. "People are eating breakfast items around the clock," Weiner said. He also cited strong growth in "appetizer snacking all day"; it's happening between 8:00 p.m. and 10:00 p.m., and also after 2:30 a.m., "when the bars close," he said.
Aside from martinis and appetizers, what about those who want "healthy" offerings? According to Riggs, only about 10% of the population is looking for healthy options. But when they say "healthy," what they really mean is they want fresh ingredients and quality food--not low-fat or low-calorie, she said.
Hanson said, "We still find that people talk thin and eat fat." People want "healthier," not necessarily "healthy," he said.
For more coverage of the FARE conference, see the August issue of CSP magazine and the August/September issue of Fare magazine.