Like many people today, I’ve both bought and consumed my meals out of home. It’s been good for the chains and independents who’ve had my spend. On the flip side not so good for the supermarkets, because less coffee consumed at home means it won’t be in next week’s trolley.
As the daughter of a chef I’m naturally curious about different OOH environments and for years have encouraged clients to be too. There’s profitable growth to be had, which can be a good P&L balancer versus the returns from incentivised volume in Retail. It can be also be a lot of fun understanding the needs and tensions of consumers, operators and their supply routes before trying to solve for them!
Facing into 2019, here are just some of the challenges that OOH players tell us they’re wrestling with:
- The need for speed. Time challenged consumers, particularly Millenials, value convenience and affordability more than ever for the occasions when “food is fuel”. Delivery is growing 10x more than the core dining-in market.
- Balancing health and ethics. The intersection of food, function and values is more apparent as menu items focus on satisfying consumers’ functional and emotional well-being from the inside-out.
- Social beyond the table. Food photo’s are a social currency creating social capital. Digital platforms used for sharing, finding and reviewing venues are at serious volumes. Culinary presentation and innovation are new essentials to be part of the 380+m posts under #foodporn.
- Delivering an experience. Consumers remain measured in their spend so the tsunami of cost increases for operators can rarely be passed on. Driving traffic through quality and experience builds the revenue stream.
- New concepts, new competition. Everyone wants in from “Grocerants” like Eataly, to the amazing standards and variety of food on offer at Street Food markets, which provide aspirational chefs with an opportunity to “test and learn”. All are becoming destinations in their own right.
- Creating something different. Consumers look for the familiarity of favourites but aspire to have that surprisingly great twist. Experimentation is a fine line between hero-ing and zero-ing the outlet’s reputation but being on trend is a must to survive.
- Personal preferences. Adapting dishes to an individual’s requirements is a necessary evil and needs to be done with minimal BOH disruption. Better to start with an inclusive menu that embraces allergens.
- Consistent ingredients and cost. Above everything, food and drink is about great taste and that’s what gets empty plates. Balancing the supply of the right quality of raw ingredients at an affordable cost is a daily juggle.
Raising the profile and internally educating how OOH works is an on-going job to be done. For the less enlightened it remains a poor relation to retail, but it’s clear that retailers don’t see it like that as they look to extend into the OOH space (Tesco/Booker) and regain our spend. The more enlightened brand owners are also getting in on the act and buying their way into outlets and/or brands – Costa/Coke, Starbucks/Nestlé. Some are also realising the value of OOH as a media channel for their brands, something Heinz has done for years using presence on table tops to build its mental availability.
5 STEPS BRAND OWNERS CAN TAKE TO GET AHEAD:
- Get to grips with the OOH landscape and your business.
Assess the channel values and the risks at stake. Project where your sales and margins are headed by the OOH environment and move resources accordingly.
- Reinvent how you work in go-to-market.
Redefine commercial, digital and operational strategies to optimise demand and minimise cost to serve.
- Create omni-channel category strategies.
See people as people who eat/drink in and out of home so take on the challenge of capturing their spend.
- Build simpler but stronger portfolios.
Simplify and consolidate your brand/product offer and focus on increasing penetration of best-sellers.
- Develop a relationship beyond product only.
Add value to operators by bringing them solutions to problems they face in their business, not only their kitchen.