What Does the Grocery Store Dining Experience Mean for the Future of Grocery Retail?

The rise of the internet marketplace has forced every industry to make some adjustments. Grocery retail has certainly not been an exception. Any sales and marketing agency would tell the average brick-and-mortar retail business that the key is shifting their business strategy to focus on making products available online. The retail grocery industry, however, isn’t positioned to live online. Rows of fridges and freezers, deli, bakery, and butcher services require real estate. The only recourse for grocery stores is to bring business to them.

As a result, the industry has seen an upswing in more niche and artisanal grocery stores. This has resulted in an increased focus on point of sale convenience, an emphasis on health and transparency, and—significantly– a re-imagining of what grocery stores are and provide. There are two key components of this paradigm shift. One is a push to control and market more of the food preparation process, like offering ready-to-cook meals and meal kits. The second is about making the grocery store food experience about more than just buying groceries. Specifically, it’s about offering a personal, sophisticated, and enjoyable in-store eatery.

Why It Makes Sense

As more of the grocery store/restaurant hybrids (aka “groceraunts”) prove successful, the explanation for their success becomes obvious in hindsight. Millennials, it turns out, are the ideal demographic for contributing to the success of groceraunts. Forty-three percent of pre-millennial populations ate out once a week. Millennials, on the other hand, choose restaurants over home-cooked meals 53% of the time.

It’s also no accident that so many groceraunts focus on coffee and alcohol. There are a lot of wine tastings, craft beers on tap, collections of specialty whiskeys, etc. This is due in part because sales of alcohol turns a profit, and is one of the most successful strategies for in-store conversion is keeping customers in the store. If the restaurant-appreciating millennial crowd will buy a beer or glass of wine in-store and stick around to make more purchases, it is a win-win for the retailer.

Along with the traditional goods offered by grocery outlets, there’s a clear move toward more restaurant-relevant products. This offers an opportunity for forward-thinking grocery stores, grocery brokers, and those with independent food brands to promote the products consumers want. By working with an experienced CPG broker, brands and retailers can leverage their broker’s knowledge of industry trends to help guide their own products and stores to success in the competitive grocery industry.