Disruptors Aren’t Just for Fast-Changing Industries
Disruptors happen in all industries, causing shifts in the way consumers use or access products. These disruptors force marketers to adjust their ways of doing business to ensure they remain relevant with consumers’ needs. Food and beverage works this way as well – and there is evidence that new disruptors are on their way.
Before discussing any detail behind disruptors in food and beverage it’s important to understand the pace at which these changes are likely to move. Our consumption behaviors are deeply rooted in culture and are very habitual. Historically these behaviors change at a very slow pace compared to, for example, behaviors in the technology industry. The phones we carry in our pockets today probably look very different from those five years ago and include far more functions, but by comparison, what we have eaten over that same period of time probably looks similar. Disruptors in food and beverage may take 10 to 20 years to take their full grip, but it’s important to plan for them before you have to start playing a game of catch-up.
The grocerant is a good example of a disruptor we see unfolding. As the name implies, it’s a grocery store-restaurant hybrid that provides restaurant-quality, fresh-prepared foods, with in-store enjoyment options from café seating to table service. Our research shows these store formats are competing most closely with fast casual restaurants based on motivations for visiting the establishment. For both sectors, price, quality and variety of the food, and the ability to get a healthy meal drive consumers to dine there. And while both fast casual restaurants and grocerants attract Millennials, the grocerant provides its services at lower prices, helping these cost-conscious consumers dine within their budgets.
Fresh foods are a key component of grocerant offerings, and the desire for fresh carries into the home as well. The problem consumers have is that fresh doesn’t stay fresh if it lingers too long. And since many fresh items have to be purchased in larger sizes, a decent amount may spoil before all of it can be consumed. With food waste in mind, many consumers have begun experimenting with fresh meal delivery kits, which provide just the right amount of fresh food and effortlessly answer the question, “What’s for dinner?”
There are other disruptors on the horizon, and in each case there is a common theme – the disruptor saves the consumer time or money, or both. In the grocerant case, consumers save time by being able to remain in the store to get a fresh meal after shopping is done, and the prices save them money compared to other outlets. Meal delivery kits save consumers time by eliminating trips to the grocery store and by cutting out the need to research recipe ideas. Both of these concepts represent a small part of their respective segments – grocerants account for about 4 percent of the QSR retail sector, while 3 percent of individuals in the U.S. tried a meal delivery kit last year.
There’s great growth potential. It won’t happen from just one year to the next, and we need only look to history as evidence of this pace. Consider the microwave oven, which is now a fixture in about 90 percent of U.S. households. It began its residential use around the late 1970s, when advances in technology allowed for lower price tags. Despite that, it still took the better part of a decade for a majority of homes to have one. Given the way the microwave oven saves time with cooking and the vast amount of products that were developed as a result of its invention, it was clearly a disruptor. Those who prepared in the early 1980s for its expansion reaped the benefits of their preparedness.
Marketers would be wise to find ways to associate their products with current and emerging disruptors. For example, getting your products inside the fresh meal delivery kit shows consumers new ways to use your products. And while the consumer is in the grocery store, make your products available at the grocerant as either the main feature or the side component.