Fresh-and-prepared food: The next generation of grocery

Zach Brown | Mar 28, 2019 Zach Brown 03/28/19

Today’s definition of a “homemade” meal is a bit different than it was 10 years ago. Sure, there are still plenty of cooking aficionados who spend hours preparing elaborate dinners, but slow-cooked sauces and scratch-made dishes are becoming more special occasion than everyday task. With online food services like Freshly, Blue Apron, and HelloFresh, families can get these “homemade” meals delivered straight to their door and save themselves the hours of preparation.

So, if people are spending less time cooking and eating meals at home, what does that mean for grocery stores? The reality is, the grocery industry is at risk of losing more customers to faster and more convenient options—like home-delivered meal kits—unless they take action and evolve.

SMG’s recent study explored this growing trend by drawing on feedback from our market intelligence tool BrandGeek®—the fastest, most accurate source of behavioral data linked to customer feedback in real time. In a previous blog, we answered key questions to help grocery retailers convert customers into brand loyalists. Next, let’s take a look at how fresh-and-prepared offerings will help grocery earn more of customers’ “share of stomach.”


Move from ingredient supplier to meal provider

We examined the food spend and dining habits of more than 20,000 consumers and here’s the good news: customers are going to grocery stores for fresh-and-prepared options. In fact, more than half of grocery shoppers purchase fresh-and-prepared food every week.

How-frequently-purchase-food-from-grocery

But there is a big opportunity for grocery brands to get infrequent fresh-and-prepared food customers to shop more often. With 23% coming in every few weeks, there are a lot of customers buying these items occasionally, but not all the time. If grocery retailers can convert this group into bigger fans of fresh-and-prepared foods, it will make a big impact.


Increase customer satisfaction to improve your bottom line

The payoff of solidifying more fresh-and-prepared customers is big. Those who are Highly Satisfied with their fresh-and-prepared purchases spend more money at grocery stores—and spend less on non-grocery food purchases.

grocery-store-compared-to-restaurant

Again, this is a big opportunity to impress customers with fresh-and-prepared offerings and give them a highly satisfying experience. By providing a less-than-stellar experience, you’re just leaving money on the table.


Ramp up fresh-and-prepared offerings to drive customer loyalty

How do you make the customer experience a better one, so more customers will come in more often and spend more money in your store? Answer these questions:

  • Is your fresh-and-prepared section clearly marked + easy to get to?
  • Are you offering a wide selection of high-quality items?
  • Have you packaged items together in a convenient meal kit?

If you can’t answer yes to all of these, you’re missing the mark. This is what customers expect from your fresh-and-prepared offerings, and if you aren’t giving it to them, they’ll go elsewhere. Here is how customers ranked their top drivers of satisfaction with fresh-and-prepared items:

drivers-of-satisfaction-with-food

Even though fresh-and-prepared food is all about ease, taste can’t be an afterthought. Value is a big factor too, so make sure you’re providing customers with affordable options. They want to save time, but they aren’t necessarily willing to pay a huge cost for that convenience.

This is just a bite of what we uncovered. To learn more about customers’ hunger for fresher, more convenient options and what you can do to win their loyalty, download the report: How grocery can earn “share of stomach” with fresh-and-prepared foods


Zach Brown | VP, Customer Engagement