Lately, there has been a lot of discussion and predictions about the future of the restaurant industry as meal-kit companies gain popularity and as grocery stores offer more options for the on-the-go consumer.
While we recently predicted that Amazon will evidently eat up restaurant market share, the grocery business is still seeing a slump as less Americans are cooking today.
According to recent research done by Eddie Yoon, a consultant for consumer packaged goods companies, only 10% of consumers love to cook. The majority of consumers, 45% hate it and 45% feel so-so about the activity.
Interestingly enough, consumers may be watching more food-focused television, but this is not inspiring them to get in the kitchen and cook.
So should restaurants really be that threatened by Amazon's recent purchase of Whole Foods?
"Despite all the buzz about the growth of pre-prepped meal kits like Blue Apron, or the promise of Whole Foods under Amazon’s management, cooking itself is on a long, slow, steady decline. The top 25 food and beverage companies have lost $18 billion in market share since 2009. Grocers are watching customers make fewer trips to stores, and many chains are in a prolonged price war, with prices declining 1.3% last year," writes Yoon for the "Harvard Business Review."
So with that in mind, how can consumer goods stay successful in today's market?
Yoon recommends that brands should consider going super-premium. He mentions Hormel as an example. The company owns products like Spam, but it outperforms other food stocks due to the other products in its portfolio, like Muscle Milk, Justin's nut butters, and Wholly Guacamole.
Grocery stores have already started to adapt to the majority of consumers who don't want to cook a meal from scratch. Most likely, they are looking for a relatively quick and easy meal options. That's why more stores are expanding their prepared foods sections, along with providing more ready-to-cook offerings.
Yoon also recommends that consumer goods companies embrace technology and new innovations.
"One promising innovation is MATS technology, or microwave assisted thermal sterilization, created at Washington State University. This FDA-approved technology creates multiple benefits. First, it sterilizes food with minimal heat, pressure, and time so that the texture and taste of the food remains restaurant-quality. Second, thanks to the minimal degradation of quality, there is a super-clean label (meaning the product will have few chemical-sounding, unpronounceable ingredients) and an incentive to add high-quality ingredients. Third, the food remains packaged at room temperature, and remains safe to eat for months on end," writes Yoon.
Read more tips on how consumer goods companies can compete in today's market here.