October 21, 2008
H-E-B, Food Lion Helping Consumers Keep to Budgets
H-E-B and Food Lion are looking to help themselves by providing consumers with ideas on how to make their food budget dollars go farther. The two chains recently began offering recommendations for meals that consumers could make for $10 or less.
Both H-E-B, with its “Feed a Family of Four for Less Than $10” program and Food Lion’s “Dinner for Under $10” put heavy emphasis on the stores’ own private labels in helping consumers stay within budget.
According to a report on The Hollywood Reporter website, H-E-B offered recipes for seven meals that center around its “Fully Cooked” entrees. Among the recipes on H-E-B’s website and newsletter are Fajita Santa Fe Chicken, Popcorn Chicken Salad, Spaghetti and Meatballs and Texas Ranch Burgers.
Food Lion’s program makes use of in-store displays to assemble all the ingredients needed for one of its “Under $10” dinners in one place.
“For example, our customers recently could find in one place all the ingredients for a spaghetti dinner for four for under $10,” said Gene Faller, Food Lion’s vice president, dry category. “The next featured meal was a chicken biscuit dinner for under $10.”
Discussion Questions: How much help do modern consumers need in planning their meals around a food budget? Can you think of other budgeting ideas that would be helpful for shoppers? How important is it to cater to local and ethnic tastes?
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This is fluff customer service. Customer’s are not going to HEB and Food Lion for cooking tips, but instead, lower prices. These grocery stores represent a consumer who is cost sensitive, but not necessarily looking for an education on how to do this, especially in the kitchen. Both HEB and Food Lion would be better off spending these dollars to better lower their prices on select items each week, and communicating this to their customers. After all, that is why they shop there….
This is a GREAT example of a highly relevant customer loyalty initiative that does not involve points, rewards, discounts or some other less relevant proposition.
It is noteworthy that in spite of the overload of news–on the economy, the presidential race and the other big challenges we are facing–that with very few exceptions, marketers are ignoring the contextual opportunity these news items present. With the exception of some brokerages, namely Schwab and Merill, marketers seem to be doing the “ostrich” and putting their heads in the sand or simply slashing prices.
This will go a long way for these brands and their long-term customer relationships.
According to a National Pork Board study, “A Profile of the Everyday Home Cook,” 87% of Americans prepare the same recipe an average of 3.4 times each month and 53% need inspiration for quick and simple meal ideas. With the economy depressed, and meals at home trending higher, shoppers will bore quickly, preparing the same old thing. They’re searching for ideas to stretch a buck and to add a bit of variety into their lives.
The most popular recipe idea categories in ShoptoCook’s interactive in-store network last year were: #1, Recipes for Kids; #2, Meals in Minutes; #3, Seafood. Draw your own conclusions but our data supports the opportunity H-E-B and Food Lion are tapping into. (Category preferences based on 55 million recipes browsed during 2007.)
The old sales adage of “Don’t sell steak, sell the sizzle” may be appropriate here. Sell a meal idea, to sell more ingredients. Wegmans, Publix, Schnucks, Bloom, Brookshires, and other industry leaders lead the way by merchandising around meals in-store. HEB and Food Lion decisions reflect smart marketing for tough times.
Different consumers need different tools to stretch their food dollars.
Supermarkets like Great A&P offer red tag extended savings, weekly sales, doubling coupons, tripling coupons, great tasting house private labels like Hartford Reserve, and money saving quality labels like America’s Choice.
And there are free monthly in-store magazines, like Easy Solutions, that contain money saving tips, recipes, and coupon savings.
Consumers today have to dig deep into these money saving “bag of tricks.” Using a combination of all of them helps consumers manage their weekly food budgets. That’s what it’s all about.
There is one report that says that if it takes more than 15 minutes to prepare a meal, then people see it as a big dinner prep like Thanksgiving. For people who fit into this category, tips on meal preparation would be very helpful.
Total customer solution v 3.0 – H-E-B launches a geek squad equivalent, where they visit homes and upgrade the kitchens with the support of appliance makers (and sell the stuff at Amazon prices).
Great idea. This will be particularly helpful for families who are used to eating out, and who aren’t experienced at cooking from scratch. They may even find that they are engendering long-term loyalty from customers who discover that cooking can be fun.
Stores can also partner with manufacturers, providing in-store coupons and cross-promotions. One next step might be to offer 2-minute video cooking lessons in the store. Economic recovery will take years; stores should run with the opportunities they have to provide added relevance to customers.
People like junk. And in these troubled times that can often serve as a comfort food. Plus, junk is easy to cook. Have you attempted to put together a really healthy meal these days? It will cost you WAY more to purchase the spices, additives and small portions of specialty food to just give the meal some flavor.
So don’t knock H-E-B or Food Lion for trying something different. If it’s a fad, so be it. At least it’s a good one.
H-E-B is good at getting a message across. However, I think most customers who shop the higher-end conventional stores are not too worried about a food budget. The reason Walmart and Aldi are still building stores is because they came through on the price end. A real budget shopper would simply take Food Lion’s suggestion on preparing $10 meals and then buy the same products at Aldi or Walmart for $8. The best budgeting advice for food is to shop Walmart and Aldi. Then cherry pick the conventional stores. I think modern consumers realize that any other advice is misleading.
The gimmick ideas come and go. Often we applaud these ideas only to see them disappear as fast as they came. I agree with Kai–it’s fluff. I agree with Kevin about the garbage in the carts. People don’t often shop conventional stores because they are interested in nutrition. Most grocery ads include sales on soda, pizza, chips, candy, and sugar cereals, along with boxed, canned, and jarred food. Then with similar items disguised with the word “Healthy” on the label. If consumers were really interested in budgets and nutrition, conventional stores would not devote 90% of their ad space to junk.
I think retailers can really succeed with this–with the right positioning.
Granted, they can really shoot themselves in the foot by talking down to consumers–making it look as if they’re trying to call out lower-income families and teach them how to cook healthy on a budget, as if this is some remedial education program.
But when our kids were small, my friend the part-time LA celebrity chef got our book group to put together a “What’s for Dinner?” cookbooklet of fast, easy recipes our kids would actually eat. And over the course of raising a couple of picky eaters to college age, it’s still easy to run out of ideas.
And my experience of the truly affluent suggests they’re not in the stores looking to spend as much as they possibly can on groceries just for the fun of it. Yes, they’ll buy really high-end ingredients to cook on their Wolf ranges. But they’re just as happy to buy store-brand black beans as anyone else–and may wonder why we wage slaves are wasting our money on Progresso.
So I think running promotions based on easy, healthy meal ideas under $10–with the ingredients all in one place–is a winner. A retailer could even do two or three, either all at the low price or in a range: one for $10, one for $15 and one for $20, for example, and do sampling to turn the whole thing into an event.
If this became a running promotion, so shoppers came to depend on the $10 dinner idea(s) of the week as a service, it could become an important competitive advantage for the store–part of an overall brand experience that could ultimately move the organization away from price as a distinguishing factor when times improve.
This type of promotion is not only an excellent way of attracting and supporting shoppers, it is one that we will see go across the country. Food Lion’s idea of displays with all the needed ingredients strikes me as brilliant. And this doesn’t mean that the retailers will cut their revenue. Creative shoppers will know what to substitute to fit their family’s needs and pay a bit more.
The flip side however, is not as bright. Generally, healthy foods (real healthy foods, not healthy food impostors) are more expensive. We know one of the problems in poorer areas is that the population opts for cheaper and necessary alternatives with less nutritional value and more toxic processing.
But, net, net, it is a good way to go. Many modern shoppers not only don’t know how to shop, they also don’t know how to cook. Hopefully, this gives them guidance for better meal planning.
This is a fantastic idea, once coupled with the in-store displays. The key will be to figure out meal solutions that are appealing to the consumer and valuable to the retailer. By rigorously testing each offering, the retailers should be able to figure out which of these offers generate additional margin, as well as halo to the rest of the store, as opposed to cannibalizing purchases that consumers would have made anyway (but would have made at a higher price point).
This looks like a play on Publix’s Apron idea and a very good one, especially given the downscale demos of HEB and Food Lion. I disagree with Kai–I think it’s more than fluff, it’s providing a service to customers who may not realize you can make a decent meal so inexpensively. And it’s at little cost to the retailer to provide this service.
There are a couple of things I like about this initiative. First, I’m almost always shocked and dismayed at what I see in other people’s shopping carts in grocery stores. The amount of ‘garbage’ purchased is astounding, not just because of the poor nutritional value, but also because these poor food choices often end up costing way more. Hopefully Food Lion’s menus are both budget friendly and healthy.
The second reason this initiative is a winner is that it makes shopping easy for the consumer. Even setting aside the budget issue, whenever you can make the shopping experience easier and better for the customer you win. More grocery stores should take note.
What I like about this idea is that it should encourage multiple manufacturers to lend support. If retailers and healthy foods suppliers collaborate, the suppliers can build specific offers to keep their expensive products in the basket occasionally. It can be a win-win for those who choose to join in with smart offers.
This is good move for consumers and stores. Long gone are the days when the general shopping public was willing, concentrated and capable of assembling a square meal on a daily basis. Today’s fast food culture and uneducated heads of households only point to the fact that the everyday shopper could use a little help. If a store steps up to offer suggestions kudos to them! Double kudos if the suggestions are healthy and cost effective.
I do not see this as “fluff” but rather a relatively cheap and easy way to connect with the consumer. Sure, it may not pay off in huge sales but in the long-run what has the store lost…an end cap display?
Both the Food Lion and H-E-B recipe programs indicate a willingness to actually understand some of the unmet needs of their shopper communities. Why is this important? Because the market players who address these unmet needs will have a higher probability of building retail brand loyalty.
Budgeting and recipe advice constitute a tremendous unmet need. With more and more dual income families–and the irony of the current economy is that while there are fewer jobs, there are more people chasing them–time and effort become critically important. This is not new. What IS new is the economic stress of delivering just about everything for less–less money and less effort.
Any retailer who identifies real unmet needs and then commits to fulfilling them in a sustainable fashion will significantly impact their probability of success. Having said that, there is no indication that either of these programs is both sustainable and of sufficient impact. The H-E-B recipes are for 7 meals, all of which use a fully-cooked H-E-B meat product as the basis for the meal. I’d like to see an interactive meal planner, linked in real-time to the actual prices of the materials used, fed by a recipe generator.
Help the consumer truly budget and plan her meals, empower her with reasonably achievable recipes (that 15 minute thing) and then update the content regularly.
The timing couldn’t have been better. This is a real ‘olive branch’ to the consumer and shows that H-E-B and Food Lion care about offering value to their customers. “Any way to save” will be the mantra of most consumers this holiday season.
Folks already know which meals are cheap. And folks know where they can get recipes. And folks know the location of the nearest supermarkets. And folks know there’s a different sale each week. It’s hard for any supermarket to be meaningfully innovative.
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This is fluff customer service. Customer’s are not going to HEB and Food Lion for cooking tips, but instead, lower prices. These grocery stores represent a consumer who is cost sensitive, but not necessarily looking for an education on how to do this, especially in the kitchen. Both HEB and Food Lion would be better off spending these dollars to better lower their prices on select items each week, and communicating this to their customers. After all, that is why they shop there….
This is a GREAT example of a highly relevant customer loyalty initiative that does not involve points, rewards, discounts or some other less relevant proposition.
It is noteworthy that in spite of the overload of news–on the economy, the presidential race and the other big challenges we are facing–that with very few exceptions, marketers are ignoring the contextual opportunity these news items present. With the exception of some brokerages, namely Schwab and Merill, marketers seem to be doing the “ostrich” and putting their heads in the sand or simply slashing prices.
This will go a long way for these brands and their long-term customer relationships.
According to a National Pork Board study, “A Profile of the Everyday Home Cook,” 87% of Americans prepare the same recipe an average of 3.4 times each month and 53% need inspiration for quick and simple meal ideas. With the economy depressed, and meals at home trending higher, shoppers will bore quickly, preparing the same old thing. They’re searching for ideas to stretch a buck and to add a bit of variety into their lives.
The most popular recipe idea categories in ShoptoCook’s interactive in-store network last year were: #1, Recipes for Kids; #2, Meals in Minutes; #3, Seafood. Draw your own conclusions but our data supports the opportunity H-E-B and Food Lion are tapping into. (Category preferences based on 55 million recipes browsed during 2007.)
The old sales adage of “Don’t sell steak, sell the sizzle” may be appropriate here. Sell a meal idea, to sell more ingredients. Wegmans, Publix, Schnucks, Bloom, Brookshires, and other industry leaders lead the way by merchandising around meals in-store. HEB and Food Lion decisions reflect smart marketing for tough times.
Different consumers need different tools to stretch their food dollars.
Supermarkets like Great A&P offer red tag extended savings, weekly sales, doubling coupons, tripling coupons, great tasting house private labels like Hartford Reserve, and money saving quality labels like America’s Choice.
And there are free monthly in-store magazines, like Easy Solutions, that contain money saving tips, recipes, and coupon savings.
Consumers today have to dig deep into these money saving “bag of tricks.” Using a combination of all of them helps consumers manage their weekly food budgets. That’s what it’s all about.
There is one report that says that if it takes more than 15 minutes to prepare a meal, then people see it as a big dinner prep like Thanksgiving. For people who fit into this category, tips on meal preparation would be very helpful.
Total customer solution v 3.0 – H-E-B launches a geek squad equivalent, where they visit homes and upgrade the kitchens with the support of appliance makers (and sell the stuff at Amazon prices).
Great idea. This will be particularly helpful for families who are used to eating out, and who aren’t experienced at cooking from scratch. They may even find that they are engendering long-term loyalty from customers who discover that cooking can be fun.
Stores can also partner with manufacturers, providing in-store coupons and cross-promotions. One next step might be to offer 2-minute video cooking lessons in the store. Economic recovery will take years; stores should run with the opportunities they have to provide added relevance to customers.
People like junk. And in these troubled times that can often serve as a comfort food. Plus, junk is easy to cook. Have you attempted to put together a really healthy meal these days? It will cost you WAY more to purchase the spices, additives and small portions of specialty food to just give the meal some flavor.
So don’t knock H-E-B or Food Lion for trying something different. If it’s a fad, so be it. At least it’s a good one.
H-E-B is good at getting a message across. However, I think most customers who shop the higher-end conventional stores are not too worried about a food budget. The reason Walmart and Aldi are still building stores is because they came through on the price end. A real budget shopper would simply take Food Lion’s suggestion on preparing $10 meals and then buy the same products at Aldi or Walmart for $8. The best budgeting advice for food is to shop Walmart and Aldi. Then cherry pick the conventional stores. I think modern consumers realize that any other advice is misleading.
The gimmick ideas come and go. Often we applaud these ideas only to see them disappear as fast as they came. I agree with Kai–it’s fluff. I agree with Kevin about the garbage in the carts. People don’t often shop conventional stores because they are interested in nutrition. Most grocery ads include sales on soda, pizza, chips, candy, and sugar cereals, along with boxed, canned, and jarred food. Then with similar items disguised with the word “Healthy” on the label. If consumers were really interested in budgets and nutrition, conventional stores would not devote 90% of their ad space to junk.
I think retailers can really succeed with this–with the right positioning.
Granted, they can really shoot themselves in the foot by talking down to consumers–making it look as if they’re trying to call out lower-income families and teach them how to cook healthy on a budget, as if this is some remedial education program.
But when our kids were small, my friend the part-time LA celebrity chef got our book group to put together a “What’s for Dinner?” cookbooklet of fast, easy recipes our kids would actually eat. And over the course of raising a couple of picky eaters to college age, it’s still easy to run out of ideas.
And my experience of the truly affluent suggests they’re not in the stores looking to spend as much as they possibly can on groceries just for the fun of it. Yes, they’ll buy really high-end ingredients to cook on their Wolf ranges. But they’re just as happy to buy store-brand black beans as anyone else–and may wonder why we wage slaves are wasting our money on Progresso.
So I think running promotions based on easy, healthy meal ideas under $10–with the ingredients all in one place–is a winner. A retailer could even do two or three, either all at the low price or in a range: one for $10, one for $15 and one for $20, for example, and do sampling to turn the whole thing into an event.
If this became a running promotion, so shoppers came to depend on the $10 dinner idea(s) of the week as a service, it could become an important competitive advantage for the store–part of an overall brand experience that could ultimately move the organization away from price as a distinguishing factor when times improve.
This type of promotion is not only an excellent way of attracting and supporting shoppers, it is one that we will see go across the country. Food Lion’s idea of displays with all the needed ingredients strikes me as brilliant. And this doesn’t mean that the retailers will cut their revenue. Creative shoppers will know what to substitute to fit their family’s needs and pay a bit more.
The flip side however, is not as bright. Generally, healthy foods (real healthy foods, not healthy food impostors) are more expensive. We know one of the problems in poorer areas is that the population opts for cheaper and necessary alternatives with less nutritional value and more toxic processing.
But, net, net, it is a good way to go. Many modern shoppers not only don’t know how to shop, they also don’t know how to cook. Hopefully, this gives them guidance for better meal planning.
This is a fantastic idea, once coupled with the in-store displays. The key will be to figure out meal solutions that are appealing to the consumer and valuable to the retailer. By rigorously testing each offering, the retailers should be able to figure out which of these offers generate additional margin, as well as halo to the rest of the store, as opposed to cannibalizing purchases that consumers would have made anyway (but would have made at a higher price point).
This looks like a play on Publix’s Apron idea and a very good one, especially given the downscale demos of HEB and Food Lion. I disagree with Kai–I think it’s more than fluff, it’s providing a service to customers who may not realize you can make a decent meal so inexpensively. And it’s at little cost to the retailer to provide this service.
There are a couple of things I like about this initiative. First, I’m almost always shocked and dismayed at what I see in other people’s shopping carts in grocery stores. The amount of ‘garbage’ purchased is astounding, not just because of the poor nutritional value, but also because these poor food choices often end up costing way more. Hopefully Food Lion’s menus are both budget friendly and healthy.
The second reason this initiative is a winner is that it makes shopping easy for the consumer. Even setting aside the budget issue, whenever you can make the shopping experience easier and better for the customer you win. More grocery stores should take note.
What I like about this idea is that it should encourage multiple manufacturers to lend support. If retailers and healthy foods suppliers collaborate, the suppliers can build specific offers to keep their expensive products in the basket occasionally. It can be a win-win for those who choose to join in with smart offers.
This is good move for consumers and stores. Long gone are the days when the general shopping public was willing, concentrated and capable of assembling a square meal on a daily basis. Today’s fast food culture and uneducated heads of households only point to the fact that the everyday shopper could use a little help. If a store steps up to offer suggestions kudos to them! Double kudos if the suggestions are healthy and cost effective.
I do not see this as “fluff” but rather a relatively cheap and easy way to connect with the consumer. Sure, it may not pay off in huge sales but in the long-run what has the store lost…an end cap display?
Both the Food Lion and H-E-B recipe programs indicate a willingness to actually understand some of the unmet needs of their shopper communities. Why is this important? Because the market players who address these unmet needs will have a higher probability of building retail brand loyalty.
Budgeting and recipe advice constitute a tremendous unmet need. With more and more dual income families–and the irony of the current economy is that while there are fewer jobs, there are more people chasing them–time and effort become critically important. This is not new. What IS new is the economic stress of delivering just about everything for less–less money and less effort.
Any retailer who identifies real unmet needs and then commits to fulfilling them in a sustainable fashion will significantly impact their probability of success. Having said that, there is no indication that either of these programs is both sustainable and of sufficient impact. The H-E-B recipes are for 7 meals, all of which use a fully-cooked H-E-B meat product as the basis for the meal. I’d like to see an interactive meal planner, linked in real-time to the actual prices of the materials used, fed by a recipe generator.
Help the consumer truly budget and plan her meals, empower her with reasonably achievable recipes (that 15 minute thing) and then update the content regularly.
The timing couldn’t have been better. This is a real ‘olive branch’ to the consumer and shows that H-E-B and Food Lion care about offering value to their customers. “Any way to save” will be the mantra of most consumers this holiday season.
Folks already know which meals are cheap. And folks know where they can get recipes. And folks know the location of the nearest supermarkets. And folks know there’s a different sale each week. It’s hard for any supermarket to be meaningfully innovative.