Grocery retailers who want to keep their edge would be wise to beef up their deli/prepared food offerings.
That’s the conclusion of a new report by New York-based Nielsen, which tallied $15 billion in deli prepared sales in the U.S. in 2016, 4.5 percent more than the year before.
“Grocery stores that focus on innovation within deli prepared are seeing stronger growth than those that do not,” according to the study.
Deli prepared accounted for 59 percent of all deli purchases last year. Category growth, according to Nielsen, is being driven by affluent, older consumers who live in urban centers. Households with incomes over $100,000 are 20 percent more likely to buy deli prepared items. Empty nesters and senior couples, meanwhile, purchase 17 percent and 21 percent more deli prepared, respectively, than the average consumer.
While many U.S. consumers are hopping on the meal kit bandwagons, deli prepared is “an even quicker option for time-starved shoppers,” according to the report.
“Grocery stores continue to provide an abundance of deli-prepared options that require no additional prep time and are ready to eat, capturing those that may not be as skilled chefs.”
With more food dollars being spent away from home, retailers who strengthen their deli prepared programs can help ensure those dollars stay in the grocery store rather than migrating to a restaurant or other foodservice channel, according to Nielsen.
The report does uncover some challenges for deli prepared. About one in four shoppers think deli prepared foods are lacking nutritionally, 17 percent think they’re expensive and 16 percent believe they lack freshness.