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Thought Leadership - Sharing insights

Nov 23, 2018

Food Matters Live 2018

I recently presented at Food Matters Live on the topic of food to go, here is the summary of some of my key points. (summarised in this video)

FTG is a dynamic, fast-moving market. Nearly all consumers eat FTG with 96% of the population eating FTG at some point in the year, typically buying two items, 4+ times a week. For retailers offering a great range, FTG can be very powerful in driving visits, loyalty and sales. For manufacturers and producers of FTG products, understanding the underlying trends will help in the development of consumer solutions that meet their needs.

A relatively unique feature of FTG is that shoppers are nearly always buying for themselves – it is very personal and therefore the opportunity for impulse is high, as is trading up.

Brands that are winning are those that are tapping into three consumer opportunities, namely convenience, healthier and happier.

Convenience works on three levels – product, location and shop.

Product – the product needs to be available, easy to come by, easy to find and practical e.g. including cutlery if needed.

Location – the outlet needs to be close to consumers and offering the right type of range for the type of consumers that are close by. Also, the outlet should be focused on delivering for the day part that consumers visit the store. Is the outlet on the way to work, therefore should the outlet deliver for a breakfast mission? Do people visit the outlet on the way home from work, therefore should the outlet consider selling easy meal solutions that can be purchased on the way home? Is the outlet close to offices, therefore, the main mission is lunch?

Shop – is the shop easy to use? Is there a huge queue at the till when you get there? New ordering options and new payment options can help to make an outlet more attractive.

Healthier

Health is affected not only what we eat, but how much (portion control). Health as a driver of choice is accelerating, in fact, an increasing number of shoppers “expect” a healthier range and the lack of this type of range can be a barrier to purchase or even cause consumers to go elsewhere.

Happier

Consumers want to have a good experience. This can include wanting products that have strong sustainability or provenance cues.  FTG can win by offering consumers a great experience and enjoyment. Treat plays an important role here as does having experiential occasions.

When researching for my presentation I was surprised by some key facts I found.

1 – Breakfast is the fastest growing occasion in this channel. The breakfast occasion is driven by coffee and more indulgent categories.

2 – The number of meals carried out from home to be consumed away from home is growing. Of carry-out meals 54% of them are consumed at lunchtime, 22% as a morning snack,12% as an afternoon snack. Of these three occasions, afternoon snack is growing the fastest. Lunchboxes are not just for children, adult lunchboxes are big and increasing. Grocery stores should critically consider products that can be included in a lunchbox including products that acts as an ingredient.

3 – Let us consider Greggs, who many people would think of as a pasty and sandwich outlet. 40% of all of the purchases made in Greggs are for coffee only!

FTG is good for retailers. It is usually higher margin than other items in the store. As retailers move to small stores and adopt a small store strategy (developing convenience and small store formats), FTG can play a big part in delivering the strategy and even act as a differentiator. Store formats are changing as are the players in this area. Coffee remains very important and defines this category with non-conventional retailers coming through now and growing.

In such a busy market innovation is key. There is clear evidence that consumers are willing to try something new and more expensive out-of-home, this makes it a natural arena for experimentation and in fact this channel is often used as a brand innovation launch pad.

Consider a cup of coffee – it costs 5 pence to make it home, just how much are people prepared to pay for it away from home?