October/November, 2006

From the Editor

Meal Assembly Delis

Minneapolis — Bob Waldron is engaged in one of the food industry’s fiercest battles. Sitting at a small conference table in his office, he recently revealed his latest, not-so-secret weapon.

“This might seem small to you,” he said, tearing open a box of hamburger helper — the new Philly Cheesesteak variety — and pouring its packet of french-fried onions across the table, “but we generally have not had a crunch before.”

The crunch is a big deal to Mr. Waldron, vice president for marketing at General Mills Inc. and the man currently responsible for Hamburger Helper. After 30 years as the undisputed king of dinner mixes, Hamburger Helper suddenly faces a challenge. The food industry, obsessed for years with making products ever readier to eat, has had a revelation: Americans want to do a bit, but just a bit, of actual cooking.

Food Industry Battles for Moms who Want To Cook Just a Little, The Wall Street Journal, March 7, 2001

The cover story on Meal Assembly Centers (MACs) brought to mind the long ago cover story from The Wall Street Journal excerpted above. The article was about “convenient-involvement products” of which Hamburger Helper is emblematic.

The basic idea is that products can be made too convenient. Although Hamburger Helper was introduced in 1971, during a time of soaring beef prices and economic malaise as an economy tool to help harried homemakers extend a pound of chop meat to a dinner for five, its almost instant and long-sustained success has indicated it drew on a reservoir of guilt by parents, especially working mothers.

Turns out that no matter how many other things they may be doing, no matter how justified their use of takeout or convenience foods, many Moms feel an important obligation to prepare dinner for the family. And “prepare” is the operative word.

Even if the budget allows, just buying takeout and putting it on the table doesn’t satisfy the need of many primary caretakers, and especially of mothers, to be actively involved in the preparation of their families’ meals.

This issue’s cover story is filled with genuine insight into consumers’ thoughts on this new MAC phenomenon. In these venues, consumers can come in, prepare meals and take them home to freeze for later consumption. The shopping and clean-up is all done for consumers.

Consumers sing the praises of the product because they can adjust recipes to their families’ taste and avoid unhealthful ingredients, like too much salt, etc.

In her column on page 8, Lee Smith, publisher of Deli Business, notes supermarkets may want to consider opening their own MACs to capture this market and serve as a venue to keep consumers involved with the supermarket. She is right on. With ready access to all ingredients, ability to not add an additional stop at another venue to the schedule of a busy consumer and the fact that consumers could shop on the same trip, supermarkets are poised for a win.

The problem is that we don’t yet know if MACs are viable. As the article points out, they are booming — but almost all are franchises, and the small footprint of most of these stores allows them to open easily in many locations. In addition, it is an easy concept to understand, and most people looking to start a business would find this concept accessible.

But are these stores earning an adequate return on capital? Do the families that own them earn an acceptable wage for their work? We really have no idea.

The fact that few of the stores are corporate-owned may be a bad sign. Past experience with fast-food restaurant chains taught us that those that have good concepts may want to keep franchising to grow fast but corporations usually like to get in on the profits from company-owned restaurants as well.

It is certainly worth experimenting with, and every chain should be building a few in a remodel or new store.

Yet, win, lose or draw, the important lesson for delis may not hinge on the success or failure of the MAC as much as on understanding the emotional resonance of these stores. As mentioned above, many consumers feel a little guilty if they just open a prepared food from the deli.

The way to capitalize on the motivations behind the MAC phenomenon is to look at the whole product line and find opportunities for consumer involvement.

One problem is that retailers invest so little in researching their customers, their desires and their motivations, especially their feelings toward cooking. The Wall Street Journal article referenced earlier included this quote: “Companies such as Pillsbury and Nestlé have done exhaustive research on how many pots and pans harried chefs want to use and how long they want to spend at the stove so that they can still feel good about the result (answers: one [pot] and 15 minutes). Psychology is almost as important as flavor.”

This lack of research makes it very difficult for retail foodservice operations to sit down with vendors and direct product development in a direction that will ultimately please consumers and sell well.

But the gist is that there is a big market out there that wants both real convenience (15 minutes cooking and one dirty pot) and involvement (stirring and browning in the case of Hamburger Helper) — and supermarket delis need to experimenting with this as well.

The key is to understand that whether MACs are the next big thing or not, there is a consumer need that delis can’t answer by simply making product more convenient.

This is a problem...and an opportunity.  DB