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Redefining the Boundaries of Supermarkets: Transformation in Dairy, Deli, and Bakery Sections

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Redefining the Boundaries: Transformation of Grocery Stores in Dairy, Deli, and Bakery Areas
Redefining the Boundaries: Transformation of Grocery Stores in Dairy, Deli, and Bakery Areas

Redefining the Boundaries of Supermarkets: Transformation in Dairy, Deli, and Bakery Sections

Grocery Stores Embrace Meal Solutions and Cross-Merchandising

A shift in consumer behavior towards ready-made meal solutions is driving a change in the way grocery stores approach their offerings, particularly in the deli, dairy, and bakery sections. According to recent studies, more than two-thirds of shoppers are purchasing prepared foods, with hot entrees being the most popular category.

Erin Storm, SVP and chief marketing officer at Grand Rapids-based SpartanNash, highlights that shoppers are seeking fresh, ready-to-enjoy meal solutions, not just ingredients. This trend is reflected in the growing popularity of dinner, lunch, and even breakfast items, as noted in FMI's "Power of Foodservice at Retail" report.

This approach is especially important in the increasingly heated battle for the consumer food dollar. Nearly one-third of consumers are dining out less frequently and turning to grocery stores for convenient meal solutions, according to the same FMI report.

The Fresh Market store in Algonquin, Ill., is an example of this trend, presenting ready-to-cook meal solutions and pre-made dips and spreads in high-traffic areas like the deli, bakery, and dairy sections.

Rick Stein, VP of fresh foods at Arlington, Va.-based FMI - The Food Industry Association, emphasizes that food retailers and suppliers aim to provide shoppers value beyond just price and quality. They offer experience, relevance, and convenience, as well as cross-merchandising products from different categories together to present customers with complete meal solutions.

Charcuterie presents an opportunity for growth in the bakery and deli sections, according to Anne-Marie Roerink, principal at San Antonio-based insights firm 210 Analytics. Co- and cross-purchase data provides insight into many questions, such as the high cross-purchase between eggs and bacon.

Success in these areas requires compelling presentation and the ability for shoppers to visualize the meal, stresses Roerink. Retailers can drive a bigger ring by putting complementary items near each other, such as whipped cream next to or near pies.

The integration of cross-merchandising with digital data is also reshaping in-store merchandising, pushing retailers to personalize meal suggestions and optimize inventory placement for both physical and e-commerce platforms. This approach supports regional grocers in competing more effectively against large players by offering connected, convenient meal solutions that drive higher basket values and shopper loyalty.

In summary, the key trends are: - Breaking category boundaries to provide meal solutions spanning dairy, deli, and bakery. - Offering easily assembled or ready-to-eat meal combos by grouping complementary fresh and packaged products. - Using strategic cross-merchandising to tap into impulse buying and increase average basket size. - Leveraging data and omnichannel approaches to align in-store cross-merchandising with growing online grocery consumer preferences. - The traditional shape of grocery stores is being softened to create a more rounded approach to meeting shopper needs. - SpartanNash is one retailer that's working to deliver meal solutions, including at its recently refreshed Family Fare stores in Michigan. - Grocers are focusing on providing solutions across dayparts and occasions, including prepared or nearly prepared meals and offerings for recipes and snacking. - Recreating a menu-like experience where visuals, cross-merchandising, or recipes conjure up a meal in people's mind is powerful in driving a full-basket sale.

[1] Source: Progressive Grocer's 76th Consumer Expenditures Study [2] Source: FMI's "Power of Foodservice at Retail" report [3] Source: 210 Analytics report [4] Source: Anne-Marie Roerink, principal at 210 Analytics

  1. As grocery stores adapt to the rising demand for meal solutions, they are conducting market research to better understand shopper preferences, focusing on cross-merchandising food-and-drink, home-and-garden, and lifestyle items that cater to ready-to-enjoy meal solutions across different dayparts and occasions.
  2. To enhance their competitive edge, retailers are leveraging digital data and shopper insights to offer meal solutions that span dairy, deli, and bakery, and adaptively cross-merchandise products from various categories, especially charcuterie in the bakery and deli sections, to provide complete and visually appealing solutions that align with shopper needs and lifestyles.

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