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How Retailers Are Using Food and Beverage to Enhance the Shopping Experience

April 2, 2018

SmartBrief  /  Emily Crowe  /  April 2, 2018

When it comes to unique customer experiences, more retailers are turning to food and beverage to add a little something extra to their operation. Whether it’s a sit-down restaurant or a quick-service counter, retailers and grocers are finding success with these partnerships, cross promotions and collaborations. Likewise, restaurants are finding willing partners in retailers with distinctive offerings, as well as launching their own retail divisions

The trend is driven, in part, by today’s ever-changing retail landscape and the need for retailers to adapt and change their brick-and-mortar spaces in order to keep up with the desires of today’s consumers.

“You simply don’t have to leave the house to shop anymore, so traditional foot traffic at retail is being pretty significantly disrupted,” explains David Portalatin, food consumption industry analyst with NPD Group. “Retailers now across the board have to think about ‘what is the purpose of this box that we have?’”

Adding an experience or unexpected twist is one way retailers and grocers are making the move. Retailers such as Ikea, Nordstrom and Whole Foods Market have been offering shoppers varying levels of dining experiences for years, while pop-ups and immersive experiences are beginning to make waves. Makeup brand Glossier, for example, recently partnered with Rhea’s Cafe in San Francisco to offer diners an opportunity to test and purchase Glossier products while dining on fried chicken sandwiches.

“Food and beverages are that experiential component that a lot of retail occasions are missing,” Portalatin says.

Chef John Doherty and interior designer Mark Zeff have taken a more classic approach with BLACKBARN Shop, Cafe and Bar in New York City’s Chelsea Market. The space marries gourmet meals, bar snacks and cocktails with a sophisticated design aesthetic and retail area, with even the plates and cups used for dinner service available for purchase.

“Anything you can do to create an experience for the consumer makes for better business,” Doherty says. “We’re constantly trying to create experiences so it’s not just food and wine.”

For Cooper’s Hawk Winery & Restaurants, having a retail selection that includes bottles of wine and home goods allows the restaurant to interact with its guests as a lifestyle brand while also contributing to the bottom line, says Eric Larson, director of retail strategy.

“While doing a wine tasting or while waiting to be seated, guests love to browse the retail merchandise, and thus they don’t mind waiting for a table if necessary,” he explains. “It extends the Cooper’s Hawk brand into the home and as a unique source for wine-centric gifts for our guests to give.”

As for grocers, adding a foodservice element can be a good way to add value to the operation, says Bret Yonke, manager of consumer insights at Technomic.

“A big part of it is you’re showcasing what you have,” he explains. “You’re really engaging consumers at a deeper level.”

With many larger grocers morphing into a type of community hub that offers meals, bar items and even live entertainment, Yonke expects to see an increase in supermarkets with quick-service meals and other unique opportunities such as wine tastings.

While this type of model can be a boon for retailers and restaurants alike, operators should be careful when considering getting into foodservice.

“At the end of the day, food quality and food taste are still the most important things,” Portalatin explains. “Not everybody is equipped to do that.”

Since operational execution is also an imperative when selling fresh prepared foods, it does take the right touch.

“It can be a great opportunity,” Portalatin says. “There’s great margin in it, but proceed with caution.”