Coverage from the fourth annual FARE (Foodservice at Retail Exchange).
What’s 113 degrees among friends? High temperatures—it was Arizona in June, after all—didn’t deter the 400 attendees of the fourth annual FARE (Foodservice at Retail Exchange) from having a cool time at the breathtaking Westin Kierland Resort in Scottsdale. The staffs of CSP and Fare were there to cover every detail of the two days of dynamite general sessions, thought-provoking breakouts and life-altering networking in the food pavilion. And don’t forget the FARE After-Dark Lounge ... though from what we saw (and heard) of the karaoke, some of you might want to.
A New Consumer
Innovation, creativity crucial to lure today’s diner, FARE panelists agree
How do you attract a consumer who has been changed—permanently— by the recession?
It’s not just about price. Consumers want value. They want an experience. Some of them want it “healthy.” And they want you to offer what they want when they want it.
That was the sentiment agreed upon by the participants in the “Trend Translations” general session. Moderated by Abbie Westra, executive editor of Fare magazine, the session featured presentations from Bonnie Riggs, restaurant industry analyst for Port Washington, N.Y.-based The NPD Group; and Kevin Higar, senior manager for Chicago-based Technomic Inc.
Riggs, who has been tracking the restaurant industry since 1976, said this recession was different from any other because it has forever changed the consumer’s mindset about purchasing. In previous recessions, shoppers went back to their old ways. Not this time. And that means the battle for market share will continue, Riggs said.
The good news for c-stores is that they’re positioned to lead retail overall, with NPD predicting double-digit growth through 2019 for the channel. The challenge for all slices of retail will be figuring out how to keep aging baby boomers, all 76 million of them, seeking out their locations for meals; and how to cater to the finicky, 52-million-strong Generation Y.
“You won’t be able to reach them in traditional ways,” Riggs said.
Translating the facts and figures introduced by Riggs and Higar were last year’s Leader in Retail Foodservice award winners: Byron Hanson, director of deli operations and foodservice for Lund Food Holdings Inc.; Steve Hammel, dining services program manager for Navy Region Southwest; Ken Toong, executive director of auxiliary enterprises for University of Massachusetts Amherst; and Jerry Weiner, vice president of foodservice for Rutter’s Farm Stores.
Hanson stressed the importance of “critical price points,” citing the ripple effect of Subway’s $5 Footlong. His stores introduced “Five Buck Cluck” (a $4.99 rotisserie chicken) and saw sales of the fowl increase tenfold. “You have to make it an experience for them to come and eat,” said Toong, whose 40,000 students and faculty he likened to “a city” he has to feed every day.
Introducing a “blue plate special” type of meal worked at Hammel’s Pierside Café concept. The idea was so popular that the café went from being the “home of the $5 lunch” to the “home of the $6.95 lunch”—with no complaints about the price increase, he said.
Factors such as hospitality and ambience, unique items and menu desirability matter a great deal to today’s consumer, Higar said. An example of a quirky, fun offering he discovered: the Blow Pop Martini from the Sugar Factory in Las Vegas, which features a lollipop in the beverage and Pop Rocks on the rim of the glass.
That menu desirability translates to offering certain items all day. “People are eating breakfast items around the clock,” Weiner said. He also cited strong growth in “appetizer snacking all day”; it’s happening frequently between 8 and 10 p.m.
Aside from martinis and appetizers, what about those who want “healthy” offerings? According to Riggs, only about 10% of the population is looking for healthy options. But when they say “healthy,” what they really mean is they want fresh ingredients and quality food— not low-fat or low-calorie, she said.
Hanson said, “We still find that people talk thin and eat fat.”
Fighting the Good Fight
Leaders in Retail Foodservice award winners battle for knockout food offerings
In FARE’s opening general session, Fare executive editor Abbie Westra moderated a panel discussion among the winners of this year’s Leaders in Retail Foodservice awards. While each of them has different ways of approaching his or her operation, they all have something in common: Each is in a fight.
For Angelo Mojica, director of food and nutrition services for the University of North Carolina Healthcare system, it’s fighting the notion that hospital food is neither good nor that good for you.
To that end, his team, consisting of 30 registered dietitians and more than 200 hourly employees, have taken formerly contracted retail operations and brought them in-house. They’re delivering unique concepts (such as Brooklyn-style pizza) and menus that are holding their own against local competition. And their efforts have taken the operations from $5 million in revenue to close to $9 million.
“We said, ‘Let’s not be hospital food,’ ” he said. “ ‘Let’s be better than that. Let’s be restaurant-quality.’ ” Mojica is also committed to giving people a choice. He’s not one to favor a healthy-food mandate. The argument he makes: If you tell a man who’s just had a heart attack that he can’t even think about eating a burger, “It’s just gonna make [him] mad.” Recommend a lowsodium, low-fat diet, of course, but don’t treat him like a 5-year-old, he said.
Mojica’s next commitment: bringing his concepts to people in the hospital with what he calls “restaurant service.” Folks might not feel well while in the hospital, but seeing a menu with a bunch of different choices that appeal to them makes them feel better.
Jennifer Vespole, director of foodservice for Whitehouse Station, N.J.-based Quick Chek, will be the first to call her chain “modest.” But there is nothing modest about the 125-store chain’s foodservice program. Her fight: turning around a new menu for the stores twice a year.
“We plan a year out,” she said. That year includes “a lot of menu ideation with vendor partners,” plus photo shoots and packaging orders. Once the product is available, she introduces it to the leaders of the chain’s 12 districts and trains them. Then they train their own teams. The product is always evolving as the process goes along, she said.
Addressing the age-old issue of c-stores not being perceived as places to go for quality food, she said, “If you handle petroleum and food the right way ... you fit into [customers’] lifestyles.” Quick Chek had “a leg up” because the chain’s original stores were community superettes, but the company has evolved beyond its core foodservice business into items such as a black Angus deli sandwich on a Portuguese roll, and lasagna soup. Kris Klinger, director of hospitality for the University of Southern California, in Los Angeles, finds himself in a fight to keep students and faculty from leaving the campus when they’re in search of food.
Overall, USC Hospitality brings in $50 million annually and comprises 42 venues—17 of which opened up just last summer. He has developed concepts to fight the competitors outside of the school’s “four walls” and has even partnered with local restaurants to keep the students happily eating on campus.
“We have a discriminating student population looking for different options,” he said. To discover what that population wants, he meets with students and faculty frequently. Next up on his list of ever-evolving offerings: kosher, vegan and sushi concepts.
Connect With Customers Via the Basics
The explosion of media types, the disaggregation of content and the empowerment of the consumer have created an environment in which it’s at once easier and harder for brands to resonate with shoppers. The goal is no longer how your brand connects with its consumer, but how and why consumers connect with you.
“I won’t just watch a TV ad—I might also comment on it on Facebook. I won’t just go to a restaurant; I’ll check in and look for deals,” said Gavin Blawie, vice president of client strategy for digital marketing agency 360i. “Push marketing has given way to pull, and in every direction.”
Blawie assured attendees that while marketing tactics are different, the keys to success are much the same. With that, he offered a few rules to follow for digital marketing success.
- Listen. Seek to understand what people are already saying about you, be it employees, friends, family, suppliers or competitors. Grow a thick skin, but not too thick that you cannot absorb the feedback.
- Understand your most loyal, most enthusiastic customers. Your advocates hold the key to your success; they’ll lead the way. Also target the influentials: bloggers or locals who have the ear of other consumers.
- Show you care. Build a customerobsessed culture and show it through actions, not just words. Do basics such as sampling and merchandising brilliantly.
- Maintain predictability and consistency. “Inconsistency breaks your brand’s narrative story,” Blawie said. When asked what one thing a retailer should do to dip a toe in the digitalmedia realm, Blawie recommended to at least check out Foursquare, the locationbased social site that lets people check in at businesses, get ranked based on frequency, and potentially receive coupons for their patronage.
And when tasked with proving the ROI of social media, Blawie pointed out that some traditional marketing is even more difficult to determine ROI on than social media. “At least you have people raising hands,” he said, countering with his own question: “What’s the return on ignoring social media?”
How to Cater to the Gluten-Free Population
“Alot has changed in 10 years,” said Robert Landolphi, who began creating gluten-free options for his customers in the early ’90s. Since then, awareness of celiac disease and gluten intolerance has grown, diagnoses have increased, and prices of gluten-free products have begun to drop as competition for the $2.6-billion market has grown.
Landolphi, manager for culinary development at the University of Connecticut in Storrs, offers gluten-free options in all the dining and retail locations on campus, from residence halls to convenience stores. He offered attendees facts on celiac disease and gluten sensitivity as well as tips for offering gluten-free foods.
- Celiac disease is not an allergy, but a digestive and autoimmune disorder that begins in the small intestine. People can inherit the genes associated with celiac, or an environmental trigger such as a virus, bacterial infection or pregnancy can cause the onset of symptoms in an adult.
- While a person can be tested for celiac via a biopsy of the small intestine, antibody blood tests or blood DNA tests, there are no tests for gluten sensitivity.
- The demand for gluten-free products reached $2.6 billion in 2010 and is expected to increase by 20% each year for the near future.
- As a foodservice professional, the easiest way to tackle both celiac and gluten intolerance is to treat them as food allergies—which means avoiding crosscontamination.
- Carefully read all ingredient labels; gluten is found in unexpected places such as salad dressings and deli meat. When in doubt, contact the manufacturer.
- While many foods can be prepared in the same environment without cross-contamination, it is very difficult in a bakery environment, where flour is airborne. Unless you have a separate facility, baked goods are best sourced from a certified gluten-free manufacturer.
- Avoid cross-contamination by having a designated area for gluten-free food prep, with its own cutting board, knife, utensils, pans, toaster and any other tools.
How to Make Coffee Fast, Fresh and ‘Mine’
It’s enough to make a coffee guru weep: Customers rate the variety of coffee additives as more important than the variety of coffee. In other words, if you don’t have the right creamers, your beans don’t matter that much.
Dan Streetman, certified lead instructor for the Specialty Coffee Association of America (SCAA) and director of coffee for Irving Farms Coffee, didn’t weep—but he definitely winced—when pointing that out during the breakout session “Recipe for Great Away- From-Home Coffee.”
Citing a WhiteWave Foods study on coffee consumers, Streetman says they have three demands for a coffee offering: Make it fast, make it fresh and make it mine.
And they mean fast: According to the study, customers want to leave their car, buy the coffee and be back in the car in less than 4 minutes. To achieve that, Streetman suggested placing a coffee display visible from the front of the store so the customer doesn’t need to waste time hunting for the brew. Along with visibility, adequate, neat prep space is crucial. Forty-nine percent said they would not return if they experienced a messy or unclean coffee area.
“Freshly brewed” is the most important factor when having a quality coffee experience, according to WhiteWave. Consumers want coffee that does not taste burnt, is freshly brewed and is not watery. To achieve this, Streetman suggested that retailers brew high-quality coffee, and brew fewer roasts more frequently. Most consumers are content with four roasts: regular, French, decaffeinated and Colombian.
To brew high-quality coffee, the three most important factors are:
- A correct coffee-to-water ratio. The “golden cup” standard set by the SCAA for the coffee-to-water ratio is 3.5 ounces by weight of coffee to 64 fluid ounces of water.
- A grind to match brewing time. Normal drip brewing takes 4 to 6 minutes.
- Good quality water. The sediment content of the water should be 75 to 250 mg/L of total dissolved solids.
Coffee’s flavor degrades over time, and heating it destroys its flavor. If you’re brewing coffee every hour, that’s reasonable, he said; anything less is “fantastic.” And now back to that creamer statistic. Making the coffee “mine” is key. Seventy-two percent of participants in the WhiteWave study said the most appealing attribute for do-it-yourself coffee is “ability to customize.” Fifty percent would consider not returning to a location to purchase coffee based on a poor creamer experience.
Putting Together the Food-Safety Puzzle
When it comes to the federal Food Code, states can choose whether or not they adopt the current version, continue to follow an older version, or even adopt only parts. So it’s not surprising that foodservice operators are frequently frazzled by the jigsaw puzzle they face.
Consider that four states still rely on the 1997 Food Code or earlier, and that 11 states—13% of the U.S. population— stick with the 1999 code. The majority of states have entered the 21st century, so to speak, adopting the 2001, ’05 or ’09 federal codes.
Why is it important not to rely on decade-old regulations? According to some food-safety specialists, if regulations are too lax or outdated, fatal foodborne illnesses can arise even when the retailer—commercial or noncommercial— is compliant. For instance, says food-safety consultant Marsha Robbins, listeria, a potentially fatal bacteria, can grow at 38 degrees; meanwhile, pre-2005 federal food codes require refrigerated storage temperatures to be no higher than 41 degrees Fahrenheit.
“Some laws that today are too minimal can lead to death,” she told CSP. Robbins was among several dozen attendees of the session “Navigating the Food-Safety Landscape.”
Session presenter Susie Sid, of the Phoenix-based Maricopa County Environmental Services Department, shared in the frustration many foodservice directors face in discerning the multitude of regulations. Most foodservice enforcement agencies simply lack the manpower or punitive might to adequately govern the myriad foodservice operations, she said.
Rather, government depends on establishments to monitor itself while governmental bodies from the local and state level pursue the most egregious violators, she said.
“Regulators aren’t keeping you safe,” she said. “Industry—managers and employees—are keeping you safe. “It has to be a partnership, with government and private industry working together. Government doesn’t have the resources to catch every mistake, and most companies, when they make a mistake, correct it because they don’t want to face a lawsuit.”
Reframe the Debate, Berman Urges Retailers
Obesity, high-fructose corn syrup, soda, menu labeling: To many concerned citizens, these are the buzzwords of concern, causes and federal remedies.
To scores of foodservice manufacturers and retailers, this list yields instant shivers of trumped-up causes and simplistic villains to satisfy a public’s thirst for government solutions to one’s palate propulsions.
And to Rick Berman, they’re warning bells of government overreach and unseemly incursions into a free-market system built on informed choice.
Berman’s message was clear, if not urgent: Be proactive, not reactive. When soda and snack taxes spring up, you’re already steps behind. Don’t wait for activist groups to pounce and set the agenda, he charged, and don’t grant them the self-righteous stage of moral purists. Frequently, they’re not.
Berman cited several examples of claims and campaigns that appear noble but in actuality are specious. Take, for instance, the campaign to ban high-fructose corn syrup. The truth, said Berman, is that high-fructose corn syrup is no more harmful than table sugar. Yet it’s been cited as a colossal culprit against one’s good health. To combat what he calls misinformation, his company, Berman & Co., helped launched www.sweetscam.com, a website aimed at debunking what it considers health myths. This doesn’t mean high-fructose corn syrup is healthy; rather, Berman explains, it is being singularly and wrongfully targeted as the primary source for obesity and other health concerns.
There are numerous other examples of dubious claims, he continued. Consider the recently enacted federal menu-labeling requirements, which are being finalized by the FDA and are expected to run businesses thousands of dollars to post calorie counts on food items.
“Warning labels will follow calorie counts on menu boards,” Berman said. “Government soon will have a moral authority” to further restrict the foods we eat based on the national healthcare reform.
And referring to those who are attacking food products, Berman urged the audience to reframe the debate before their businesses are undercut. “Do you want to defend your product or not? You’re in a war, an economic war.”
For Beverages, the Upsell Is Critical
Citing statistics and the obvious margin advantages, Debbie Wildrick urged FARE attendees to push the upsell when it comes to beverages. “It’s important that every time you sell a meal, you also sell a beverage,” she said during the breakout session “Beverage Can Make (or Break) the Margin.”
“Decide whether your [retail site] is ‘drinks with meals’ or ‘meals with drinks.’ If you start out with meals, you probably have the better opportunity to grow through beverages [than the other way around],” she said. Wildrick, now president of her own consultancy, Growing Innovative Brands, spent several years overseeing the beverage category—both dispensed and packaged—for 7-Eleven Inc., and she also worked for PepsiCo’s Tropicana.
Specific to convenience stores, she said, “Consumers choose c-stores because of the selection of drinks. [That’s] really what they’re looking for, and they’ll buy a meal because that selection of drinks has brought them into the store.”
While foodservice-at-retail operators often find themselves in the shadow of quick-service restaur ants (QSRs) and casual-dining locations, fighting for customers, Wildrick pointed out that retail operators are ahead of the game in one respect: traffic.
“Retail has an advantage because it has more foot traffic than QSRs,” she said, “and you have foot traffic throughout the day, not just during meal time.” Proper placement of products, a focus on variety and meal bundling are key ways to tap into this advantage.
“Having all these [beverages] next to food products is definitely creating impulse sales,” she said, citing a retailer who swaps out the beverages in a cooler as he changes food items to meet various dayparts.
Bottom line: “Focus on beverages’ role in all aspects of a day-part.”