Editor’s Note: In the final installment of a three-part series investigating the opportunities and challenges of supermarket prepared foods, we pick up where we left off in February by examining what prevents consumers from purchasing them, and what would further stimulate trial and repeat.
Supermarket prepared foods are poised to continue gaining steam for years to come, buoyed by progressive retailers upping their games with new types of products and expanded selling space to court an increasingly receptive consumer base.
But it’s hardly a one-size-fits-all proposition, so it’s imperative for category leaders to remain keenly focused on the increasingly important — and equally complex — prepared food category, for which knowledge of the latest insights of evolving consumer demands and expectations are paramount.
Keeping in mind one of the most important takeaways revealed in our second series installment — that raising awareness of the product categories is critical to increasing the penetration of total supermarket prepared food shoppers — ICC/Decision Services began the final chapter of PG’s prepared food research study by asking its sizeable consumer panel base to describe the primary factor that influences purchase decisions.
By the Numbers
“Age is a big storyteller in this phase of the study,” affirms Eric Baer, research analyst and project leader for the ICC/PG consumer survey. “While there is no one age group that takes greater advantage of the prepared food offerings from one retail outlet over another, needs were found to differ by age group.”
Commenting further on the overall findings of the latest prepared food consumer research, Nanette Brown, ICC’s VP of operations, notes, “Younger consumers shop less for meals that are time-saving in preparation, but are heavily interested in preordering prepared food items online and save their time in that aspect.”
However, adds Brown, the reverse is true for older shoppers, “who are less concerned with the time-saving aspect of ordering ahead and who would rather save their time when it comes to their meal preparation and convenience.”
While time-saving convenience and fresh, high-quality ingredients ranked as the top two most popular attributes, cross-tabulated responses among the panelists’ demographics found younger shoppers, 18 to 34 years old, more concerned about price (28 percent) than convenience (23 percent). In terms of gender, time-saving meals are less of an influence for male shoppers purchasing prepared foods when compared with female shoppers (29 percent versus 37 percent).
Weighing the Options
When asked about specific attributes sought when deciding which prepared foods to purchase, the vast majority of ICC panelists (42 percent) cited options free of additives, preservatives, chemicals and dyes. Meanwhile, 17 percent of the votes favored prepared foods that support a weight management program.
Household income levels can affect what shoppers look for in their deli prepared foods. Cross-tabulated responses reveal that shoppers from households that make more than $80,000 annually are more likely to look for prepared foods that are free from specific additives than shoppers from households that make $40,000 or less (49 percent versus 37 percent). Shoppers who live by themselves, meanwhile, are more concerned with prepared foods that support a weight management program when compared with shoppers with five or more people in their households (21 percent vs. 11 percent).
When asked about their primary store’s availability to preorder fresh meals online or at an in-store kiosk for pickup at the deli, more than one-third of surveyed shoppers signaled positive marks that their store offers advance ordering options, while the majority (63 percent) of panelists said no. Shoppers who make less than $40,000 annually are less likely to use this service, even though their deli area provides it as an option (19 percent versus 32 percent overall).
When looking at the cross-tabulated responses, ICC’s Baer observes: “Those in the $40,000-or-less income bracket do not use the option to preorder prepared foods ahead of time as much as other shoppers. This could be due to lack of access to the technology to do so,” he says, adding that lower-income shoppers also are less likely to notice advertising for prepared foods from online sources.
When asked if they would like to have/use a preorder option for supermarket prepared food ordering, either online or at an in-store kiosk for pickup, younger shoppers (18 to 34 years old) were found to be most interested in seeing the service offered by their local supermarket (80 percent vs. 69 percent overall). Households with five or more people, however, said they would want the preorder service more than those who live by themselves (80 percent vs. 60 percent).
In terms of awareness of the placement of advertised prepared food specials, more than two-thirds of panelists rely most heavily on point-of-sale messaging, followed by more than half who seek out on-ad specials in printed circulars. A full quarter of prepared food survey participants, meanwhile, gain information about supermarket prepared food deals online, either via a retailer’s website or social networks.
A closer look at the comparative demographic stats finds that shoppers who annually earn $80,000 and above notice online advertisements more than those earning $40,000 or less (28 percent vs. 20 percent). No surprise here: Shoppers age 18-34 are less likely to notice advertisements in printed circulars (49 percent vs. 56 percent overall).
When asked about the various options most frequently purchased, respondents ranked salads, full-service hot meals, packaged and made-to-order sandwiches, and self-serve salad and soup bars highest. Made-to-order salads, sushi, self-serve hot food bar, pizza and self-serve antipasti bars paced next as the most popular meal choices, while side dishes, made-to-order sushi and self-serve breakfast items also registered as gaining in popularity with the prepared food research panelists.
The comparative demographic insights for the most frequently purchased prepared foods find older shoppers (age 55 and above) purchasing certain items less than younger shoppers (18-34), such as packaged sandwiches (42 percent versus 53 percent), packaged sides (37 percent versus 44 percent), and packaged sushi (18 percent versus 40 percent).
Conversely, higher-income shoppers ($80,000 or more annually) purchase specific items more than lower-income shoppers ($40,000 or less), including packaged sides (47 percent versus 40 percent), self-serve salad bar (47 percent versus 33 percent), self-serve hot soups (44 percent versus 28 percent), packaged sushi (36 percent versus 19 percent), and made-to-order sushi (19 percent versus 10 percent).
ICC’s Brown weighed in with potential suggestions for retailers seeking to refine and enhance their prepared food menus: “Specific prepared food items should be advertised in formats that cater to specific demographics,” such as packaged sandwiches, sides and packaged sushi, which are purchased more by younger shoppers. Advertising efforts for these specific items, she says, can be more visibly positioned in areas where younger shoppers notice advertisements, and less in other areas where they don’t (think circulars).
Moreover, when considering that shoppers annually earning $80,000 or more purchase more prepared food items, Brown says more highly visible advertising efforts should occur more in printed and online mediums, given that this income group is more apt to use/view them.
A particular area of opportunity, adds ICC’s Baer, is breakfast, which he says remains largely untapped. “Closer consideration should be given to availability and increased promotion of breakfast food items, which were the least often purchased,” he says.
Baer’s suggestion bears out recent related insights by Port Washington, N.Y.-based NPD Group, which for the fourth consecutive year found restaurant breakfast occasions increasing in frequency among U.S. consumers, while lunch and dinner occasions have declined. In 2013, consumers made more than 12.5 billion breakfast visits to U.S. foodservice outlets, a 3 percent gain over the year-ago period, according to NPD, while quick service, which accounts for about 80 percent of total restaurant morning meals, showed the strongest increase in breakfast visits of all restaurant segments, with a 4 percent increase compared with the year-ago period. However, morning meal visits to midscale/family-dining restaurants declined by 3 percent.
NPD forecasts that the away-from-home breakfast trend will continue, as total restaurant morning meal visits are expected to grow by 7 percent over the next nine years, with quick-service breakfast traffic expected to increase by 9 percent.