Driven by lifestyle changes, convenience food items continue to increase in popularity, and they have been for more than a decade. COVID just put that demand into overdrive.
“In an instant, our customers went from eating half of their meals away from home to cooking and eating nearly all their meals at home,” said Nate Stewart, senior vice president of perishables for West Des Moines, Iowa-based Hy-Vee.
“Many customers have longer workdays as they work remotely or transition back to the workplace, and these customers still have to prepare dinner and are looking for time-saving tips and easy meal solutions.”
That makes convenience items more attractive than ever. Even at-home chefs appreciate convenience —cooking is more fun if some of the tedious work is done ahead of time, like chopping or dicing vegetables. And nearly two years into the pandemic, he added, some of those lifestyle changes and habits are sure to last long term.
The pandemic has also greatly increased the willingness of shoppers to buy fresh foods online, Stewart said.
“Hy-Vee has been known for its fresh departments for decades, and our Hy-Vee Aisles Online customers want their favorite Hy-Vee perishable favorites just the same as our in-store customers. Although we launched Aisles Online more than six years ago, the pandemic significantly increased its popularity. We’ve found that our customers are now very comfortable ordering fresh items online.”
Hy-Vee trains its employees to choose only top-quality produce and other perishable items for its Aisles Online customers. Key to selling fresh items successfully online is communication, Stewart said. For instance, Hy-Vee texts or calls customers regarding any questions or substitutes.
“We also actively ask for feedback after every order,” he said. “The key is building trust and consistency, so our customers know that the employees selecting their fresh items are choosing top-quality product every time.”
Hy-Vee’s retail foodservice offerings have been among the convenience items that have seen the biggest growth in recent years, particularly after the onset of COVID, Stewart said.
The retailer’s Mealtime To Go service is in an easy-to-use app and website format allowing customers to choose their Hy-Vee favorites for delivery, curbside pickup or instore pickup. Options include breakfast, Wahlburgers favorites, sandwiches, HyChi, Nori Sushi, Mia Italian options, desserts, a kids’ menu and more.
Sales of Hy-Vee’s Mealtime heat-and-eat meals are also up.
COVID has accelerated the growth not only of convenience items but also of health-focused foods, Stewart said. Combining those two needs in products and services will continue to be a major priority going forward.
“There is increasing interest in healthy take-home items that fit time and budget constraints,” Stewart said. “Offering grab-and-go pre-packaged salads, bowls and other heathy prepared foods is both a short-term fix in a pandemic and a long-term solution to the desire for health and convenience.”
All of Hy-Vee’s fresh departments are experiencing renaissances when it comes to convenience, but Stewart said the most innovation is taking place in meat, seafood, produce and retail foodservice. (The instore bakery, by nature of its product roster, has always been a strong performer in convenience options).
Items that currently stand out include value-added meats that can be prepared easily; ShortCuts pre-cut, pre-washed vegetables; and items that can be microwaved.
A fresh produce angle
COVID definitely accelerated demand for convenience items in the fresh produce departments of Tulsa, Okla.-based Reasor’s Foods stores, said JJ Sanders, the retailer’s produce director.
“We saw these changes coming, they’re just here sooner than we expected,” Sanders said. “Both grab-and-go and value-added are focuses for us.”
Reasor’s is seeing double-digit growth in its cut fruit/veg and value-added sales, he said. One standout performer is a local brand, Scissor Tail Farms Salads, which highlights its local advantage with the tagline, “Thousands of Miles Fresher.”
Any way that produce and other fresh departments can position products as part of a meal solution is another guaranteed winner, he added.
In addition, convenience-minded consumers are feeling more comfortable buying fresh fruits and vegetables online, Sanders said. And a more intense focus on health is also driving growth.
With online sales, though, it’s crucial that suppliers and retailers deliver information that shoppers may have formerly gleaned instore, either from packaging, signage or a produce clerk.
“Telling the story is more important than ever,” Sanders said. “Larry Reasor always said, ‘Sell the customers items they want to buy, not what we want to sell them.’ So right now we are listening.”
Tapping into lunch demand
Pre-pandemic, many harried consumers grabbed lunch from the prepared foods section or another fresh perimeter department of their grocery store.
COVID did a number on that and other foodservice-channel lunch options. During the pandemic, about 78% of lunches were prepared and eaten at home, according to the Chicago-based NPD Group.
Now, however, with many Americans returning to work full-time or at least part-time, away-from-home lunches are starting to pick back up, and for the convenience-minded, the grocery perimeter is a great option and retailers who tap into it have much to gain.
“The need to have instant foods or foods that can be prepared in less than a minute are starting to come back,” said Darren Seifer, NPD food and beverage industry analyst. Prepared foods sections in grocery perimeter departments can “meet the needs of those consumers who don’t have that time.”
Interestingly, he added, even during the pandemic when far more people were eating lunch at home, the ever-growing demand for convenience was still there.
“Even when consumers were working from home, the need for convenience was still there. They still only dedicated 5 minutes to preparing lunch. So the ‘lunch rush’ never really changed.”
Retail grocers looking to bolster their grab-and-go lunch options should keep in mind that convenience-minded consumers like anything that fits into an easy-to-carry bag so they can have one hand on their phone and the other on their lunch, Seifer said.
Snack kits, packaged lunches and snack foods like fresh fruit or bags of chips are also big winners when it comes to convenience and lunch, he added.
Online and physical foodservice visits during lunch increased by 4% in the year ending September 2021 compared to a year ago when visits were down by 11%, according to NPD.
Although lunch traffic hasn’t fully recovered to pre-pandemic levels, down 8% from September 2019, the increase in visits is a significant improvement over the double-digit declines experienced last year.
According to NPD’s recently released Future of Lunch study, restaurant lunch visits are forecast to grow by double-digits from 2021 through 2024, but the gain will be 2.4% below pre-pandemic levels.
“Consumers are on the go now, which means they’re looking for convenience, whether they prepare it or a restaurant or retailer does,” Seifer said. “Food manufacturers, restaurant operators and retailers all have opportunities to fulfill consumers’ lunch needs whether they’re commuting, staying at home, or a hybrid of the two.”
Convenience-minded breakfast consumers heading back to work could also provide retailers with big opportunities to bolster their grab-and-go offerings with yogurt cups and other products, Seifer said.
As for dinner, one convenience-related development that exploded during COVID was the wide adoption of air fryers in Americans’ kitchens. About 40% of homes now have them, Seifer said.
Retailers and their supplier partners can tap into this surging category by making it as easy as possible for consumers to use their air fryers, via instructions on food packaging and other methods, and just by making it clear which products in the perimeter can be cooked in air fryers.
Convenience has always been important for shoppers, but the focus and definition have changed, Seifer said. It used to be just about saving time in preparing the product.
Now, consumers also want to save time and energy buying the product and figuring out how to make it — cutting down on what Seifer calls “decision fatigue.”
Digital will play a huge role in the future of convenience, Seifer said.
“Digital ordering is a bright spot, and the forecast is bright for that continuing. Pre-pandemic, there were still a lot of hurdles to get over, then all of a sudden millions of people figured out how to use it for food and beverage.”
Perishables are still in many ways the “last hurdle” for online ordering, and brick and mortar isn’t going anywhere, Seifer said. But during the pandemic that hurdle got a little lower.
“When people are walking through the perimeter, they may look at the fruit and say, ‘I want bananas with a little bit of green on them.’ But I think what this last year proved is that if the bananas aren’t exactly the way you want them, they’ll still be OK.”