Friday, April 28, 2017

Phil's Friday Rap

What I'm watching this week.

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"I thought it would be easier."

No, this column is not going to be about the revelations of our president as he approaches the 100-day mark. It's about the retail food business.

Countless times each month I have heard these same words from retailers at all levels as they share their frustrations and challenges as they seek out their company's future amid a sea of changing players. The leaders of the majority of our retail banners are in their later fifties to seventies and for the most part, their competition has been from similar enterprises. Twenty years ago they were challenged by big box stores, mass merchandisers and stores called Trader Joe's and the then tiny Aldi (who received little attention if any). Then came the drug chains, farmers markets and e-commerce. And the retail leadership stretched to meet each one head on; and in some cases stood their ground.

In 2017 the food world is quite different. 

For close to ten years our consumer panel and trend reports highlighted the growth of smaller format stores that went far beyond the traditional c-store format that so many discounted as competition long ago. Today, with the likes of Sheetz, Wawa, 7-Eleven and others, this format can no longer be ignored – especially as it is fueling the innovation that we are seeing that brought about Amazon Go and Amazon Fresh in formats that combine robotics, technology, curbside pick up and culinary. 

Aldi and Lidl are building their businesses on their own quality and curated brands to Millennials and Gen Z who see little difference between private label and branded goods. For them it's about value, quality, transparency and buying their foods from companies that share their values. 

The food world has changed. Are you prepared?

What I am watching this week:

In a very smart move, which follows the leads of Panera, Aldi and others, Harris Teeter has issued their list of "Free From 101" products and are labeling them on-shelf. Retailers that curate and make a commitment to their customers on ingredients will win big!

The Washington Post has a great column written by Caitlin Dewey "Industry is counting on Trump to back off rules that tell you what's in your food." Forget politics. We are in an era where consumers are demanding more transparency, not less. Shame on us.

Across the pond McDonald's is testing home delivery. As is everyone else. The problem as we see it is that consumers are already tiring of scheduling and being home for deliveries (there are exceptions) as we have seen in supermarket click and collect programs we expect fast food to turn to mobile and allow customers to order and pay online and drive up to a special prepaid window. After all, who of us hasn't struggled with exchanging cash for food as we try to reach up to that window that doesn't seem right for a sports car, SUV or sedan?

That's it for now. Have a great weekend and be sure to check out all our stories and videos at SupermarketGuru.com.

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