Move over, fried chicken strips, mayo-laden potato salad and overstuffed meat sandwiches. Today's supermarket deli food offerings are an improved trifecta of taste, variety and nutrition. Alongside traditional deli meats and cheeses in the "prepared foods department," consumers now can find an array of diverse and delicious freshly prepared foods that rival restaurant meals.
Available options include ready-to-eat, heat-and-eat or partially prepared meals that require minimal finishing time at home. Consumers can order from a display case at the counter, grab ready-to-go items from self-service refrigerated shelves, help themselves to salad, soup and hot food bars, or even customize made-to-order meals at ethnic food kiosks — all in the convenient setting of their local grocery store. This new prepared-foods format has become so popular that it has earned the moniker "grocerant" — the intersection between grocery store and restaurant.
Big and Growing Bigger
With a $26 billion market, prepared foods are a huge growth category for retailers. This has the restaurant industry worried, as more consumers in search of quick and healthy meals at a good value look to prepared foods as an alternative to quick-service and fast-casual restaurants.
In fact, sales of prepared foods — for both in-store eating and takeout dining — have increased 30 percent since 2008, compared to a 10-percent increase for the foodservice industry overall. Still, visits to the prepared foods department are not yet routine for most shoppers, with less than half of shoppers saying they regularly visit this department.
When asked, consumers most often say they buy prepared foods because they don't want to cook that evening — so it's not surprising that dinner is the most popular meal for the prepared foods department. Other reasons why consumers purchase prepared foods include convenience (already at the store), cost (cheaper than eating out) and simplicity (easier than preparing foods from scratch). And the most frequent buyers, Millennials, are looking for convenient options that offer high-quality, fresh foods to fit their busy lifestyles.
Feeling Fresh and Nutritious
Conveying freshness is critical to a successful prepared foods department. Attractive displays, a "made-on-site" look, frequent item rotation, clear packaging, local sourcing of ingredients, use of "made today" labels, and labeling that shows when an item was made versus an expiration date all add to the feeling of freshness that customers want.
Fresh is where stores such as Whole Foods Market excel. Jess Kolko, RDN, LD, senior research analyst on the Global Perishable Purchasing team at Whole Foods, spends part of her time working with chefs on the "healthification" of menu items in the prepared foods area, boosting the nutritional value of Whole Foods' dishes where possible. This is in addition to Kolko's responsibilities of sharing nutrition and ingredient information about Whole Foods' prepared foods with customers. The quality standards for the foods Whole Foods sells in stores extends to those sold in the prepared foods department, so items
are free of artificial preservatives, colors, flavors, sweeteners and hydrogenated fats; meats meet the company's internal animal welfare standards; and wild-caught seafood is certified sustainable, while farmed seafood meets strict internal quality criteria. Locally grown produce is used whenever possible.
"Transparency of ingredients is important to our customers, and it's important to us," Kolko says. That syncs with survey findings among prepared foods shoppers, who say they want 100-percent natural foods that are free from artificial ingredients, low in sodium, low in sugar, free from trans fats and low in calories. Nearly one-quarter also say they want hormone-free animal products.
Beyond ingredients, shoppers of the prepared foods department are interested in health and nutrition information for foods they buy, and this information will soon become the standard for most chains selling prepared foods. Yet, some have made that leap early.
Mariano's, with stores in the Chicago area, offers online nutrition information for prepared food items. Likewise, the New York-based chain Wegmans lists nutrition information for its popular dishes as part of an Eat Well, Live Well program. At Whole Foods, consumers can find the Health Starts Here emblem on prepared dishes and salad and hot bar selections that meet its criteria for healthy options — which are items made using whole foods, contain only healthy fats and are "plant-strong" and nutrient-dense.
At Kowalski's Markets, a small, high-end chain in the Twin Cities, a "Good Foods for Good Health" emblem is found on deli salads that meet specific nutrition criteria, as well as a "Made with Gluten Free Ingredients" designation to help those on a gluten-free diet find options more easily.
Rotisserie chicken has been standard deli fare for years. But nowadays, consumers will find more ethnic options, from Vietnamese pho to Cuban sandwiches, as well as regional favorites such as slow-cooked barbecue and seafood chowders.
Many stores feature "gourmet homestyle" dishes that are rooted in comfort food but revamped as an upgraded version that consumers wouldn't typically prepare themselves — either because the dishes require too much time or use more expensive premium ingredients. This comfort food fare is particularly popular at Kowalski's Markets, says corporate nutritionist Susan Moores, MS, RDN, but dishes with trendier ingredients, such as ancient grains, are top-sellers, too.
Whole Foods looks at global culinary trends and explores new menu items, Kolko says, and a big focus is on innovative ways to use plant foods. Similarly, Wegmans places a strong emphasis on creative vegetable main and side dish offerings in its prepared foods department.
"Our $6 meals feature our 'Half-Plate Healthy' initiative," says Kirby Branciforte, RD, a Wegmans nutritionist. With this program, consumers are encouraged to fill half their plate with two servings of vegetable side dishes, fruit or a combination of both, and the other half with their choice of an entrée.
Retailers and restaurants continue to compete for a share of consumer food dollars. However, consumers' desire for more nutritious and convenient food options offers grocery stores an opportunity to increase sales by promoting choices in their ever-evolving prepared foods departments.