‘Grocerants’ join dining with grocery shopping
Cooks at T&T Supermarket’s first seafood bar in Vancouver stand ready to prepare spot prawns, clams and lobsters freshly ordered by grocery shoppers, as the Asian-focused chains ups the ante for Canadian grocers increasingly looking to the “grocerant” trend to get shoppers to linger longer and spend more.
At a time of intense competition in the grocery business, chains increasingly blur the line between supermarkets and restaurants, adding take-out meals to their shelves, hot food counters where chefs make dishes to order and even full-service restaurants.
Diners at the new T&T destination receive a pair of gloves to eat — no cutlery — and sit in the seafood department, surrounded by creatures in live tanks and buckets containing orders zipping overhead.
They appear to be eating it up. There’s been a roughly 60-minute wait for seating since the supermarket opened last week.
“It’s a restaurant-quality experience at supermarket prices,” said Tina Lee, CEO of T&T, which is owned by Loblaw Companies Ltd.
Known to industry insiders as “grocerants,” such combination spaces serve a time-strapped population that values convenience at a time when grocers are feeling growing pressure from online competitors.
Loblaw is joining many rivals in the race to woo customers with innovative in-person experiences.
Ontario grocer Farm Boy’s stores feature a kitchen that prepares fresh food, including sushi, and eating areas with free Wi-Fi. Rival grocer Longo’s runs three bars that serve pizza, burgers and other food. Whole Foods Market locations offer areas to enjoy meals from its prepared foods department.
Supermarkets seem to be taking a page out of playbooks from shopping malls, which are facing similar pressures from consumers driven toward the convenience of e-commerce, and are working to attract customers inside with real world luxuries. Malls are dedicating more space to food services and anchor tenants, like Nordstrom and Saks Fifth Avenue, carve out space for restaurants, cafes and food halls — a fancier take on the food court concept.
Grocerants generated 2.35 billion visits in the U.S. over the past year ending June 2018, according to data from market-research firm NPD Group — down two per cent from the same period a year ago due in part to an uptick in foodservice delivery options.
“If you serve convenience to consumers, you can increase margins,” said Sylvain Charlebois, a Dalhousie University professor whose research focuses on the food industry. He identified grocerants as a major trend for this year in his annual report.
Canadian grocers are competing in a difficult landscape. Retailers Costco and Walmart have stolen billions of dollars worth of market share from traditional grocers over the past decade, and tech titan Amazon’s recent acquisition of Whole Foods has prompted a race to implement e-commerce options among companies that had been previously slow to offer delivery services.
They also face pressure from restaurants, where consumers looking for quick dining solutions over complicated home-cooked meals spend their money.
Retail sales between June 2017 and June 2018 increased 0.7 per cent at food and beverage stores, according to Statistics Canada’s most recent figures, but fell one per cent at supermarkets and other grocers — excluding convenience stores.