A growing appetite for meal solutions

Meal making gained a certain prominence during COVID-prompted lockdowns. Stuck at home, many Canadians experimented with new recipes and rediscovered old favourites, as evidenced not just by social media feeds being taken over by sourdough bread and grandma’s lasagna, but also by consumers’ purchasing behaviours. According to The NPD Group, sales of stand mixers in Canada were up +107% in 2020, and there was strong growth in “carb” and comfort food appliances such as bread makers (+88%), waffle irons (+48), air fryers (+91%) and deep fryers (+43%).

While some home-cooking habits have waned as the world continues to open back up, the majority of consumers are likely to continue cooking many of their meals at home. However, some 20 months and thousands of meals into the pandemic, there’s more than the sound of knives sharpening and soup burbling coming from the kitchen. Tired of cooking and running out of ideas, consumers are making a resounding plea: “Help!”

“Consumers are fatigued from all this cooking they’re doing at home, but they’re still enjoying a lot of the components of eating at home,” says Rick Stein, vice-president of fresh food at FMI – The Food Industry Association. “They’re enjoying the savings and they’re enjoying having their families together. And so, what they want now is convenience. They’re looking for opportunities to have certain elements of their meals already prepared or partially prepared so they don’t have to do the entire job themselves.”

That puts grocers in the ideal spot to boost their meal solutions offering, capture more foodservice dollars, and gain a competitive edge with consumers. In fact, a recent report from FMI found that 39% of consumers view retail foodservice as a substitute for both a home-cooked meal and a restaurant meal, positioning grocers as the “ultimate mealtime solution.”

“The supermarket is the perfect space: it has all the ingredients for consumers to figure out their meals, in addition to having the retailer’s own foodservice and prepared meal offerings,” says Stein. “In that regard, grocery retailers are best poised to help consumers and provide meal solutions.”

THE NEW HYBRID MEAL MODEL

Everyone’s heard of the new hybrid workplace model. But in the grocery world, analysts have identified “hybrid meals” as the new normal. To Stein’s earlier point, the FMI study notes that shoppers are looking for comprehensive meal solutions, not just prepared items. More than half of consumers surveyed (55%) indicate a desire for hybrid meal options, meaning a mix of from-scratch foods and semi- and fully-prepared items.

Jonna Parker, principal at IRI Fresh Center of Excellence, calls hybrid meals “a mega trend” and notes that heat-and-eat fresh sides, in particular, are performing well. “A consumer might take the time to make their own ribs or steak, but they don’t want to also make a side dish and need an easy solution,” she says.

While sides are usually merchandised in the deli department, Parker says there’s an often-missed opportunity to also merchandise them in the meat department, adjacent to raw protein. “There are myriad options to make a meal. In fact, the average consumer probably passes more than a handful of other places to pick up tonight’s dinner on the way to the grocery store,” she says. “So why are we making them march around a store to invent their own meal?”

Not every hybrid meal shopper will require inspiration and items in one convenient spot, though. “[Grocery retailers] are starting to realize that people are willing to walk around the store and are probably doing other grocery shopping as well,” says Stein. “If I tell you that you can get your bagged salad over in the produce department, get your French bread in the bakery department, and combine that with a side dish, you probably don’t mind. It’s about giving consumers ideas and providing them with meal solutions.”

Cross-merchandised or not, the ultimate aim is to feed consumers with ideas for meals. “Yes, consumers are going in with a grocery list and they’re shopping for their items and ingredients,” says Joel Gregoire, associate director, food & drink at Mintel. “However, there is an opportunity for retailers to give the consumer new ideas that bring them back to their store and get them thinking of it as a destination for meal solutions.”

CONVENIENCE FOODS FOR DINNER ... AND DINNER PARTIES

Consumers’ need for fresh ideas may be the reason meal kits finally have their moment in grocery. These kits were the talk of the grocery world a few years back, but struggled to win over consumers. However, in a January 2021 study by Mintel, 46% of Canadians said they would buy meal kits available for purchase at grocery stores. Asked why they used meal kits during the past six months, the top reason was meal kits provide “new meal ideas” followed closely by “simplify meal preparation.”

“Meal solutions such as meal kits give consumers ideas and might get them to go a bit out of their comfort zone,” says Gregoire. And, of course, there’s the convenience factor. “The consumer doesn’t have to go to three or four different parts of the grocery store and try to put the ingredients for a meal together.”

Partnering with popular local restaurants is another option with strong potential. Loblaw’s Fortinos banner, for example, is selling par-baked pizzas from Toronto’s General Assembly Pizza. The pizza company got its start as a fast-casual restaurant in 2017, and three years later introduced its “freezer to table” line and a monthly subscription service. It expanded into retail this past summer, with a pilot project at five stores in the Greater Toronto Area.

Gregoire (who has purchased and tried General Assembly Pizza from Fortinos) is a fan. “The product hits on the middle tier of getting great quality that you would expect at foodservice, but you can get at the grocery store,” he says. “It also eliminates the barrier of having to sign up for a subscription service.”

Food manufacturers can also get a piece of the meal solutions pie by offering different ingredients packaged together for an appealing meal. For example, Gregoire points to Blue Dragon’s Penang Curry Cooking Sauce Kit, which contains individual sachets of Penang curry paste, coconut milk, dried kaffir lime leaves and crushed peanuts. Consumers cook the sauce in three steps and add their own veggies and/ or protein. “This is fantastic because it’s something many consumers wouldn’t think to cook at home,” says Gregoire. “It highlights the fact that retailers and manufacturers need to think about offering meal solutions versus just filling out a grocery list.”

Beyond solving the “what’s for dinner?” (or lunch or breakfast) question, grocers should also think about how they can help with holidays, gatherings and parties. “We talk a lot about winning the meal ... but what about when the consumer is going to have people over or a party of 15 or 20?” says IRI’s Parker. “That might be a bit out of the consumer’s comfort zone.”

To capitalize on these occasions, retailers should deck the display case with party food like charcuterie boards, specialty cheeses, shrimp trays, dessert trays, mini cupcakes and more. “There is a huge opportunity for convenience foods as it relates to gatherings,” says Parker.

THINK BEYOND ROTISSERIE CHICKEN

When it comes to convenience foods, most retailers have their chicken programs down pat. But, as Parker jests, “At the end of the day, we can only eat so much chicken.” Beyond the bird, there’s a world of flavours, formats and attributes grocery retailers can bring to the table.

For starters: health, which Parker believes is the biggest trend in meal solutions that retailers miss. Looking at the renaissance in heat-and-eat freezer meals, Parker says while there are still some comfort foods in the freezer aisle, manufacturers have expanded into specialty diets and lifestyles such as plant-based, keto and low carb. “These kinds of functional foods are so missed by deli departments,” she says. “When I talk with retailers about meal programs, I say, ‘have you walked your own frozen aisle recently? Because what’s being sold over there is doing really well and you can’t find it at all in the perimeter.’ Frozen meals are great for the freezer, but the deli entree space could be the place where consumers pick up high-quality, healthy meals that are fresh.”

At Eataly, a large-format Italian marketplace, chef de cuisine Steve Geuting sees some demand for quick and healthy meals. “Salads sell well, and we added a range of grain and protein bowls a few months ago that also sell well,” he says. However, not everyone is looking for a healthy lunch. In the rotisserie case, Eataly’s beef brisket sandwich is the top seller. “I think people are looking for that restaurant-quality experience and they’re looking to splurge a bit more on calories when they come to Eataly,” says Geuting.

Nico Dagnino, managing director of Eataly Canada, adds that highlighting local, seasonal ingredients across Eataly’s meal solutions is key. “Right now, our customers are going to find a lot of pumpkin, squash and mushroom baked dishes because it’s the right season for that, and we’re moving slightly away from tomato-based dishes,” he says.

For Eataly, one big opportunity for growth is growing individual categories. For example, Eataly has expanded its soup offering, with nine varieties on offer and more to come. “Within the same category, the question is, how do we expand even more and own the category even more?” says Dagnino. “We notice that variety brings a lot of attention because people understand that you own the category and that you know what you’re doing.”

At Calgary Co-op, the focus is on fresh, local, healthy, convenient and value-driven solutions. “Replication of a restaurant food experience is the goal,” says Shawn Jacks, the grocer’s senior director of fresh. “Finding creative, delicious, low-labour, price-conscious solutions in different themed cuisines to suit our patron’s evolving palate is ongoing. People are tiring of the same old, same old and seek something new that they couldn’t easily replicate at home.”

Calgary Co-op’s buffet-style programs, including the curry bar, hot soup program and wing bar, have re-opened after being closed because of COVID-19. “These programs have strict food-safety and public safety sanitation standards to ensure we offer what our customers love about these programs while feeling confident they are getting safe products,” says Jacks.

ROOM FOR IMPROVEMENT

While many grocers are attempting to make meals easy for consumers, it remains a challenge to get into consumers’ consideration set. The FMI study shows that lack of awareness among shoppers about how grocery stores offer meal solutions is a major hurdle: 35% of respondents said they don’t think grocery delis have viable meal options, up from 32% in 2017.

“You have to get into the mindset of the consumer. If I were to ask, ‘where you do you want to go for dinner?’ chances are you’re not going to think of a supermarket in your top three,” says Stein. “And so, retailers have to do a better job of getting on consumers’ radar so they become a choice.” In advertising, for example, Stein says a supermarket can promote more than the basics like produce and meat, but announce they are a meal solution provider, as though they’re a restaurant.

IRI’s Parker agrees. If a retailer has a meal solution offering that fails, it’s likely because they didn’t do a good enough job telling people about it. “Across the fresh category, there’s a bit of a marketing barrier and [grocers] don’t use e-commerce and digital well enough,” she says.

In addition, in store, retailers have a tendency to place meal solutions in areas the target customer doesn’t already frequent. If a retailer introduced a vegan meal solution in the deli, for example, odds are that target customer is not walking through that department. “When you put your vegan meal next to your rotisserie chicken case, a vegan is not going to know it’s there,” says Parker. “If you’re going to develop a meal solution that’s targeted towards a specific demographic that is not engaged with your department or even your store today, you have to reach out to them.”

Increasingly, technology will be an important piece of the meal solutions equation. In the United States, Walmart has teamed up with media company Meredith to help families buy ingredients for meals and make them more easily through the use of AI-powered planning tools, shoppable recipes, visual search, chatbots and social media. Consumers can shop for Walmart grocery products across Meredith’s platforms, including Allrecipes, EatingWell, Real Simple and others. Through new “shoppable ad experiences,” consumers can access content providing meal solutions and add recipe ingredients directly to their Walmart online grocery cart.

This past June, U.S. supermarket giant Albertsons announced its partnership with DoorDash to offer grocery delivery, including fresh and prepared foods, within an hour. “I do think it’s innovative because as a shopper, you can order pantry items you’re out of and you don’t have to order pizza [from a restaurant] on DoorDash. You can order [a prepared meal] from Albertsons,” says Parker. It’s a win for grocers, too. “They don’t have to figure out the delivery part because they’re using DoorDash.”

FMI’s Stein believes that while grocers are starting to come along on the technology front, there’s still a way to go. “The restaurant industry has done a great job over the years of adapting to mobile ordering and curbside pickup and delivery, and grocers were behind on that,” he says. “They are starting to develop apps just for the foodservice side ... but I think technology is the area where grocers have a bit of work to do.”

This article appeared in Canadian Grocer's November 2021 issue.