Published on: February 15, 2011by Michael Sansolo
On the sheer chance you didn’t have enough to worry about these days, take a deep breath and think about the never-ending battle for mealtime. And understand this important reality: it’s only getting harder.
That might sound contradictory to some good news we had on this site last week, about a recent study showing supermarkets are making in-roads at mealtime. That’s a scenario that makes sense given the heightened concerns shoppers have with both their budgets and waistlines. Supermarkets are doing a better job with prepared or step-saver meals and shoppers seem to be noticing.
But there was a different angle on this battle that also merits attention. Advertising Age reported last week that Burger King and Subway combined have spent more than $100 million over the last year advertising their breakfast menus and basically have come up empty. In short, McDonald’s, which continually unveils new menu options, absorbed the blows and kept on selling.
Simply put, the battle for share of stomach at breakfast, lunch or dinner won’t be won easily because Americans eating habits are what they are and change is difficult.
Yet, there is more to this. Last week I spoke to the American Wholesale Marketers Association, a group largely made up of wholesalers for the convenience store industry. The unmistakable lesson from this corner of the industry is that the battle for mealtime is getting more crowded.
A few of the operators at the meeting talked about the challenging reality facing c-stores as tobacco products, a cornerstone of their sales and profits, become ever more challenged by government regulations and shifting consumer habits. As these operators look for new growth, foodservice offerings move to the head of the line.
The operators have a good point. By their current count, there are nearly 150,000 convenience stores in the country and a large percentage offer gasoline, which means most consumers stop by regularly. There are a number of fabulous convenience operators (Wawa and Sheetz come immediately to mind) that are finding ways to build food sales from these shoppers. The reality is that if 150,000 conveniently located, quick stop stores can figure out how to attack mealtime, the level of competition is heading through the roof. Well, at least it could happen that way.
The other side of the story is how these convenience operators will attack. If they follow the path that seems to have caught Subway and Burger King at the moment, they will find themselves offering just another version of what’s already out there. As we all know, more of the same can make the competitive field crowded, but it isn’t likely to create a major disruption.
But what if convenience stores manage a quantum leap and change the foodservice paradigm. What if even a small fraction of those 150,000 stores find a way to serve America’s mealtime needs in creative ways that alter the landscape. Suddenly, the problem grows significantly more complex.
Sonja Hubbard, CEO of E-Z Mart Stores, made this point clear in her keynote speech. Quantum leaps, she explained, didn’t come from continuous improvement in the status quo, but by thinking way outside the box. Hubbard doesn’t have the prescription for the future, but questioned when convenience stores will get beyond the sandwich business and into the elements of more elaborate meals.
Her challenge was dead on, especially to an industry that in some corners features foodservice ideas (melted cheese nachos and revolving hot dogs) that supermarkets abandoned years ago. The challenge for supermarkets is to remember how McDonald’s keeps fighting off Burger King and Subway, with new menu items, emphasis on changing tastes and a clear focus on how to retain customers.
In other words, the battle for mealtime is always moving forward. Those who stand still, stand no chance…especially as the field gets more crowded.
Michael Sansolo can be reached via email at firstname.lastname@example.org . His book, “THE BIG PICTURE: Essential Business Lessons From The Movies,” co-authored with Kevin Coupe, is available by clicking here .
- KC's View:
- Michael’s column reminded me of something that a friend of mine told me yesterday, that he has a sign in his office that says the following:
“Without promotion, something terrible happens. Nothing.” - P.T. Barnum
The same could be said of real innovation, as opposed to copycat initiatives that do not really move the needle.