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New products for the pantry

Supermarkets are losing the takeout food war. Though few understand where it will lead, planning for an avian flu pandemic is beginning. And some unusual new products are about to hit the grocery shelves. Times retail writer Mark Albright encountered it all at the annual Food Marketing Institute convention in Chicago this week.

By MARK ALBRIGHT
Published May 9, 2006

About 2,200 of the 16,000 new products destined for supermarkets this year get their introduction to the trade here.

Most are part of a trend toward healthier alternatives. Others are new ways to do old things, such as Contessa skillet meals that package several ingredients in a single frozen food container. Contessa this year came out with paella, stir-fry orange chicken and portabello ravioli.

Anheuser-Busch premiered Peels, a line of 5 percent alcohol malt beverages infused with real fruit. The line will be tested in Florida first.

Only one in 10 of the new products introduced will be around in three years. Some are unusual. Others say a lot about how we live, or at least how manufacturers think we do.

HEALTH: No more sodas

After the debate over sodas and sweets in children's diets, two new drinks aim to trick kids into drinking bottled water.

Advanced H2O LLC unveiled lunch-box-sized bottled water that comes artificially colored in Crayola blue, red and cola. Then there's Maddie's Beverage Co., which packages purified water in 7-ounce juice boxes with little straws.

There is a lot of buzz about Coleman Natural Meats' new three-meat hot dogs for the health conscious. These dogs are made with bits and pieces of chicken, pork and beef from animals raised without growth hormones, pesticides or preservatives and on a vegetarian diet.

FOOD TO GO: Sales slow

Americans wolf down 1-million rotisserie chickens a year, but supermarkets are still losing their war over takeout with the restaurant industry.

While takeout dinner sales at restaurants have been rising 10 percent a year, they've been stagnant for a decade at supermarkets. In fact, supermarkets' share of the dinner takeout market slumped to a meager 7 percent in 2005, about half what it was a decade ago.

It's not the quality of the food, according to a study by Technomic Inc., a Chicago-based research firm. The overwhelming majority of meals in question are filled by orders for pizza, sandwiches and Chinese food. But until supermarkets get back in the game with quick-service places and confront such sit-down restaurant chains as Applebee's, Chili's and Outback Steakhouse that went after the takeout business, grocers will keep losing ground.

Restaurants taught takeout customers to insist on reserved, close-in parking spaces, a way to phone in orders, a pickup spot next to the front door and a staff dedicated only to takeout food - not the deli counter or bakery.

Most grocers are still mired in "take a number" takeout mode.

"There can be no hassle and the customer has to be out the door in five to seven minutes," said Tom Miner, a principal with Technomic.

Something also must be done about takeout cups. Most are tapered to be top heavy, and they spill easily. That's because they were designed to be stacked upside down, not actually used by customers. It's a big reason why only 5 percent of takeout orders include drinks, Miner said.

PET FOOD: Treats for Fido

Some people treat their pets as if they were people. How else do you explain Purina's new super-premium canned Fancy Feast Elegant Melodies cat food? The early favorite choice is "yellow-fin tuna in a delicate sauce with garden greens." Also new this year: Yip Yap Breath Mints for dogs.

BIRD FLU: Being prepared

The government, retail trade groups and Wal-Mart Stores Inc. all recently started planning for the possibilities of an avian flu pandemic hitting U.S. shores. But Ted Koppel made sure grocery executives ponder more than the impact on poultry sales.

Hired as a convention kickoff speaker, the retired ABC Nightline anchor recalled the 1918 flu epidemic that wiped out 5 percent of the world's population. He noted that the most effective way to survive then was to stay at home.

"We've got big freezers," he said. "We've got laptops. You're in the food business, so this could be very good for you. How many of you have a month or two supply of food stockpiled at home?"

Only 10 of 2,000 sheepishly put up their hands.

Many food companies that sell poultry products have educational ad campaigns waiting in the wings if avian flu becomes a bigger threat. Food marketers, too, are nervous about how a made-for-TV movie that airs today on ABC will depict how Americans might cope with a full-scale pandemic.

"I have not seen it, but I do know the National Guard gets called out to restore order,'' said Tim Hammond, chief executive officer of the Food Marketing Institute.

"I personally think it is unlikely this virus will mutate to human form. But we have to plan ahead to think over how we will cope with it as an industry.''

SHOPPING: Fewer trips

Americans may be spending more, but they are making fewer shopping trips.

Most likely it's because more people are flocking to Wal-Mart or Target Supercenters for groceries. In 2005, trips to supercenters rose 7 percent and to dollar stores by 12 percent compared with 2000, according to a Progressive Grocer study. Grocers lost 14 trips a year for a decrease of 14 percent. Warehouse clubs saw no change.

Could it be the growth of online shopping that was once touted as a threat to all stores? Perhaps. But Americans made 163 shopping trips in 2005, six fewer than in 2000. That's a loss of one shopping trip every two months.

ORGANIC: Booming growth

Organic foods are one of the fastest growing corners of the grocery business, but it's still a comparatively tiny industry riddled with misconceptions.

Sales grew 16 percent to $13-billion in 2005 and the Organic Trade Association forecasts that will double within five years. Market researchers , however, are finding that the growth is coming from some unexpected audiences.

Hispanics and women in their 30s who have had more than one child are driving much of the renewed interest.

"Most people still only buy organics occasionally,'' said Laurie Demeritt, president of Hartman Group, a Bellevue, Wash., research firm. "They are buying somewhat for taste and health, but more important, it's to avoid things like pesticides or growth hormones. They start by buying organics for their children, then try it themselves.''

That explains why shoppers have little price resistance to paying $2 more for a gallon of organic milk, which is one of the industry's new driving forces.

Demand for organic milk is outpacing supply, which translates to periodic product shortages in the dairy case. The reasons include too few cows but, more important, not enough organically grown feed for them to eat.

Mark Albright can be reached at 727 893-8252 or albright@sptimes.com

[Last modified May 9, 2006, 06:36:20]