December/January, 2010

From the Editor

Good Food Desired In Bad Times

Though 2009 may go down in history as a year with a deep recession, the historic ramification for the retail deli/foodservice operation may be different. Yes, of course, 2009 has been a year of triumph for Wal-Mart, Aldi and other discount concepts, but the long-term implications of that are unclear.

Some posit that this particular recession, defined by massive losses on assets — especially home values and retirement plan losses — will create a “new consumer” who will be reminiscent of the old Depression-era cohort that was so conditioned by deprivation and fear of bankruptcy as to always strive to save rather than spend, to avoid luxury and to focus on essentials.

Obviously, a cohort of consumers so conditioned would, in fact, buy very differently than consumers conditioned during an age of prosperity but perhaps not in the way those who promulgate this theory expect. They imagine consumers avoiding prepared foods, luxury items, etc. Yet even if consumers developed a Depression-era mentality, as long as we are not actually in a depression, consumers would behave very differently than their Depression-influenced forbearers.

The primary reason for a shift would be the role of women in society. Although much of the shift to prepared food, takeout and restaurant dining has been portrayed as the fruit of prosperous society — a kind of indulgence that a wealthy civilization allows — it is actually more correct to see the utilization of these products and services as the price a family pays to enable Mom to work.

The economy may get better or worse, but the decline in the number of children a typical woman gives birth to, along with the rise in the age of marriage, the extended healthy life span and the control women have over their fertility due to “the pill” and other birth control devices, all combined with a general cultural shift in expectations, make it highly likely that women will continue to serve in the labor force in large numbers.

If women stay in the labor force, then everything from convenience foods to takeout becomes something akin to necessities, not luxuries that can be easily eliminated from the budget.

Besides, tight budgets often adjust in strange ways. If ostentation and extravagance are out, consumers may shift their entertainment patterns by having fewer restaurant meals and participating in fewer grand affairs. Yet the human urge to connect is strong and these “extravagances” are likely to be replaced by more at-home entertainment, such as dinner parties, barbeques and the like.

In this year of recession — depressing even if not a depression — the specialty cheese category has been enjoying unprecedented attention. The American Cheese Society’s annual meeting in Austin this past August was a triumph, both in terms of number of attendees and number of cheeses entered into ACS’ prestigious competition. The media went cheese-crazy with a spate of attention, including the launch of Deli Business’ sister publication, Cheese Connoisseur, a hybrid trade and consumer publication now sold not only at fine cheese counters nationwide but also at major consumer magazine purchase venues such as Borders and Barnes & Noble.

Some of this may be escapism. Just as the Depression led consumers to the movies, so a recession-induced funk can be lifted by spending time with an upscale lifestyle publication built around an indulgence such as specialty cheese.

Yet it also speaks to a shift in the nature of the consumer. Just as the old World War I song asked, How ‘Ya Gonna Keep ‘Em Down On The Farm (After They’ve Seen Paree)? and in so doing raised the point that life experiences can be transformative, once consumers have traveled and sampled fine wines and fine cheeses, they just can’t go back to being ignorant of it all.

So not only do the “new consumers” want bargains and good value, but they also want the good prices on the high-quality products that they value.

This is the Costco formula and it is a pattern for success in the years to come.

It is said the economy is in a recovery mode, albeit slowly, but many good jobs have been permanently lost. But traveled, upscale epicureans who lose their job don’t suddenly lose their connection with fine food — and the sliver of cheese they eat is an inexpensive connection to the lifestyle they aspire to. In bad times that connection may be more important than ever.  DB