Neil Stern, senior partner at retail insight specialists Ebeltoft Group, told FoodProductionDaily trends stores are seeing in shopper behavior will change the face of retail in the future years. In turn, the shifts in retail direction will impact consumer packaged foods.
One notable development in retail around the world, Stern said, is increased specialization. This is due in part to stores competing for dwindling available space.
“Small is the new big,” he said. “Businesses are running out of room, so retailers are left figuring out how to fill out these small spaces effectively.”
One example of the tiny-store concept, he said, is Little Waitrose, an offshoot of the UK-based market chain. The store focuses on what it has branded as “food for now,” such as ready-to-eat sandwiches and pre-made salads; it also offers “food for later” such as pantry essentials and main-meal ingredients.
The model, also seen in Marks and Spencer and Walmart microchains, presents opportunities and challenges for food firms, in delivering packaged products fitting into stores of the future.
“The challenge for brand owners and producers is meeting the needs of consumers, using a highly edited offering,” he said. “The focus is on convenience—prepared foods, ready-to-go, and so forth.”
Shops are popping up in high-transit areas, so that busy consumers can pick up what they need without making special trips, he said. Consumers around the world want conveniently located stores they can visit on their way to and from work, for example, and get exactly what they want without having to hunt and peck for meal ingredients or components.
Another emerging business model with the potential to impact producers involves food trucks. Originating as a way for restaurants to bring their wares to people on the streets, the vehicles are being used by supermarkets and packaged food brands to connect with shoppers too busy to hit stores—sometimes parking outside stores themselves, stocked with staples so shoppers can grab what they need and go home.
Important for food firms to keep in mind as they plan for the future: consumers frequently stand at the corner of convenience, and freshness. They want home-cooked meals, but they want the preparation and shopping experience to be as easy as possible.
Store planners are meeting this dual need by putting all the ingredients needed for a meal—meat, grain, sauce, spices, etc.—in one area, Stern said. Food firms can capitalize this by producing products designed for addition of fresh ingredients, on-pack messaging offering helpful tips (including QR codes directing to recipes), creating ‘alliances’ between different brands (through promotion and packaging messages), and retail-ready packaging co-locating complementary items).
Stern spoke to FPD at FMI Connect/United Fresh, the annual event dedicated to retail food products, safety, and technologies. The event is scheduled June 10-13 in Chicago.