Raise the bar on restaurant brands in supermarkets

August 27, 2013

More eateries seek growth through food stores—they must do more than simply show up with their known names.

Some foodservice brands are already mainstays in supermarket aisles.

The names Nathan’s, White Castle, Carvel, Friendly’s, TGI Friday’s and California Pizza Kitchen help once-teenagers shopping in the frozen-food aisle to recall some of their weekend hangouts and fun times.

When restaurant brands evoke good feelings in the supermarket, they expand customer relationships and grow sales. Supermarkets speed the purchase decision, grow categories, and come closer to giving shoppers the restaurant-types of experiences at home.  

These kinds of labels were once rare on supermarket shelves, and drew attention.  However, The Lempert Report feels a huge recent expansion of this activity could possibly dim shopper excitement—much like when shoppers drive past the recognizable roadside marquees with barely a glance.  

That possibility hasn’t stopped the aseptically packed Soupman brand to court Millennials in the soup aisle. 

Nor is it stunting plans by Starbucks to create a ready-to-eat Greek yogurt parfait with Dannon.  The category continues to run hot and is under-penetrated in the United States.  The Starbucks launch will be branded as “Evolution Fresh, inspired by Dannon,” sold in Starbucks stores in 2014 and in supermarkets in 2014, reports USA Today, which also notes Starbucks CEO Howard Schulz “wants Starbucks products to be as frequently purchased at a grocery store as at a Starbucks store.”

In our view at TLR, it will take innovations like these to differentiate eatery brands on supermarket shelves.  No longer will the name alone be enough to drive performance.

Hotels are also getting into the act.  A team of chefs from various Omni Hotels developed an umami sauce with a distinctive savory taste beyond sweet, sour, bitter or salty, which hotel guests can buy for $9.95 per 10-ounce bottle, and could be headed for restaurants and supermarkets, states Restaurant Hospitality

Two other examples their report cites:  Fatburger now sells its signature beef patties at 3,100 Walmart stores.  And Seattle chef Tom Douglas, who has sold Rub With Love spice rubs, adds three of his spice blends to new POP! Gourmet Popcorn lines.

Crossover appeal will be the success key for both restaurant brands and retailers.  Therefore, retailers should insist that eateries truly understand and act on the aspect of their brands that will help grow categories in stores.