Foodservice

Foodservice Offerings Should Cater to Health, Cravings and Social Experience: Expert

Solve more consumer need states to be successful, Technomic’s Robert Byrne says
Robert Byrne, director of consumer and industry insights at Technomic
Photograph by CSP Staff

With each subsequent generation, there is an increased reliance on foodservice.

“What does this mean?” asked Robert Byrne (pictured), director of consumer and industry insights at CSP sister research arm Technomic. “Hopefully, it means more occasions, more trips, more purchases out of them. But it also means that foodservice needs to be able to solve more consumer need states. Make foodservice for more than just convenience. Make it for when they need something that’s better for you, when they’re looking to satisfy a craving, when they’re looking for the social experience. Whatever it may be. These things all become increasingly important.”

Byrne rolled out data on dispensed beverages in his presentation last week at CSP’s Dispensed Beverages Forum in Schaumburg, Illinois.

More Dispensed Beverages Forum Coverage:

While convenience is still the top reason consumers visit convenience stores, “Cravings are inching up, neck and neck with convenience,” Byrne said. “That’s great news.”

Among the evolving reasons for c-store foodservice, convenience and cravings tied at 29% for 2023. “Better for you/real, wholesome ingredients” came in second at 19%, followed by “comfort/a simple meal” at 13% and “experience/social” at 10%.

Other Highlights

  • Traditional drip coffee rules the Northeast and Midwest, while the South and West are more open to expanded coffee types.
  • Younger consumers in the West and South will leverage the roller grill in the morning.
  • Healthy continues to evolve as the primary morning need state.
  • Protein-heavy morning options appeal to more than just young males.
  • The premiumization of customized items can boost sales.
  • Customization also contributes to satisfaction and loyalty.

Drilling down on how foodservice beverage engagement is growing from first-quarter 2021 to fourth-quarter 2023, Byrne said, “In the percentage of consumers who said they purchased a foodservice item compared to those who bought a beverage item, we’re seeing an increase in those buying beverages.”

In this data, “We get to the generational divide,” he said. “Gen Z loves beverages. They will have two, three beverages going, including water. This is a place where they have that affordable extravagance. They might not be able to afford the entire meal or the expensive, premium item, but they almost always can afford a drink and they do—and they love it.”

Regional Tastes

Byrne turned to regional preferences, noting the differences across the country in beverage flavors in general—not just in dispensed.

Particularly interesting is cold coffee preferences, Byrne said. “The regular iced coffee skewing in the Northeast speaks to this consumer, who is a little bit more traditional.” Other cold coffee regional differences include frappuccino and cold brew more popular in the Midwest, iced latte and frappuccino in the South, and iced macchiato and iced espresso in the West.

In hot coffee preferences:

  • Midwest: Regular, mocha
  • Northeast: Regular, drip, Americano; “The Northeast has no flavor skews,” Byrne said, eliciting laughter from the audience. “They just want their plain, good old-fashioned coffee.”
  • South: Cappuccino, espresso
  • West: French press

In soft drink flavors:

  • Midwest: Citrus, root beer, strawberry
  • Northeast: Lemon, orange, pineapple
  • South: Peach, mango
  • West: Mango, vanilla

After noting these and other flavor differences, Byrne said retailers should think of their programs by region if they’re a national company.

Regarding what positively affects beverage purchases, attributes are:

  • Midwest: 100% fruit juice, stress reliever/relaxing
  • Northeast: Nothing artificial, all natural
  • South: Fresh brewed, naturally sweetened
  • West: No artificial ingredients, sustainable ingredients

“The Midwest is 100% fruit juice, a little bit old-fashioned, but in the Northeast we see all natural—no nonsense, make sure it’s real,” Byrne said. “In the South, they’re looking at naturally sweetened, the land of sweet tea—it will resonate. In the West, it’s sustainability.”

Technology

Turning to tech, Byrne said there’s only so much consumers are willing to put on their phones. “There may be a bit of tech fatigue happening with consumers,” he said, explaining this doesn’t mean retailers shouldn’t lean into loyalty programs, but should make messages simple and not complex.

In addition, he asked, does one’s in-store marketing match digital efforts? Convenience stores should have physical reminders—stickers, wobblers—in their stores of promotions that are online and in apps.

Customize the experience for each consumer. “What about those who want the punch card with every sixth coffee free?” he asked. “Some don’t want to be marketed to and so don’t join the digital offerings.”

Loyalty boils down to, “You can have my information in exchange for free stuff.”

One member of the audience, from Texas, pointed out the importance of having the option to switch one’s app to Spanish to cater to areas where this language is spoken a lot. If not, many potential loyalty members are lost.

In closing, Byrne said understanding regional distinctions allows for targeting customers with specific flavor profiles and preferred platforms for the right daypart. Retailers should begin by determining whether they are targeting the existing user or a new customer.

In addition, one size does not fit all, he said, and consumers are aware of this and will “individualize” their occasion. Letting them individualize boosts loyalty and satisfaction, he said, adding that this is the part increasingly played artificial intelligence-fueled loyalty programs.

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