Getting A Bigger Piece of the Foodservice Pie

Quality, price point and flexibility continue to drive customer interest in pizza.

By Howard Riell, Associate Editor.

Americans are into upscale, premium and gourmet everything these days. So why would anyone expect pizza to be any different? The question is, “Can your pizza program measure up?”

From exotic toppings to a variety of doughs, c-store operators are upscaling their pizza offerings in order to compete with everyone else that’s selling pizza—a daunting challenge, but one that can be won.

“I think the reason consumers are looking for all these enhancements is that we’re getting used to so much flexibility in what we’re being offered that we just want more,” said Darren Tristano, executive vice president for Chicago-based Technomic Inc. “Now, the convenience store provides a great opportunity for those who may not want to sit at home and wait for delivery, but are coming home and want a quick option. They’re going to get gas, pick up a two-liter soda, grab a pizza and run home. So again, just because of the name—convenience store—they’re looking for added convenience for specific occasions.”

Pizza is a big item at Manley’s Mighty Marts in Binghamton, N.Y., primarily because of this convenience factor. “It’s there, it’s ready and it delivers value and quality—everything customers expect from a pizza program,” said Brandi Becker, the chain’s foodservice director.

Manley’s move up to a gourmet pizza under the Big Al’s brand was primarily to break away from the rest of the pack. “The same old same old is boring day after day,” Becker said. “Customers have emphasized that if you deliver quality and variety, they will make repeated trips to your stores.”

Nineteen of Manley’s 23 locations make their own fresh pizza dough and sauce on site.

Veteran foodservice consultant Arlene Spiegel, of Arlene Spiegel & Associates in New York City, pointed out that while branded pizza concepts like Little Caesar, Dominos and Pizza Hut have been established as  co-branding options for convenience stores, the change to a gourmet offering is merely a trading-up of a popular menu item. “As store brands upgrade, they want to upgrade their food menus to enhance their overall image and appeal,” she said. “I’m not surprised to see burgers, sandwiches and branded delis go the same route.”

Variety is Key
Manley’s offers a wide array of specialty pizzas that, according to Becker, “you wouldn’t see at most other locations. We’ve been pushing them a lot lately.” Rolled out over the course of the last 12 months, they include:
• The popular Big Al’s Buffalo Chicken Pizza made with bleu cheese and chicken, with any of several flavors of wing sauce.
• The Philly Cheesesteak Pizza, which is topped with steak, peppers and onions and has also proven quite popular.
• The Vegetarian Deluxe.
• The Mega Meat Pizza, with ham, bacon, sausage and pepperoni.
• The Four-Cheese (mozzarella, provolone, American and Swiss) Pizza.
• White Garlic Pizza.
• A breakfast pizza that features egg, cheese and ham, sausage or bacon together with what Becker called “a secret ingredient.”

Each of the pizzas ranges in price from $7.99 for the smallest size, a 14-inch pie, to $15.49 for a full sheet pie. Additional toppings (meatballs, bell peppers, mushrooms, banana peppers, bacon, chicken, pineapple, pepperoni and more), of course, are extra. A slice is priced at $1.79 plus an additional 25 cents per topping. The company also offers consumers a two-slice special for $2.99, which comes with a fountain soda or a 16-ounce Pepsi bottle, depending on the location (not all locations have fountain machines). There is also a “Pizza Pie on the Fly” everyday special, which is one cheese pizza for $5.99 and two for $9.99.

The pizza program is marketed using in-store signage and coupons. No new specialty varieties are planned, but management, Becker said, is always open to new ideas. Some Manley’s locations also feature a program called Big Al’s Sandwich Construction Co., which lets consumers fax in their lunch orders.

Premium Products
There has never been a shortage of consumers wanting premium products. “In fact, we like to think our society would pay more for healthier product, but we really want better tasting,” said Tristano, of Technomic. “Since premium generally means it’s better quality, they’re willing to pay a little bit more.”

What Tristano called the “hard part” for c-stores is popular perception. “It’s getting past the image aspects of, ‘How do we produce a better quality product when we’re a convenience store that is primarily retail and mostly gas?’”
But Americans are willing to give convenience stores the benefit of the doubt nowadays, which is a far cry from where the industry was even five years ago. “What consumers have said in almost all of our consumer research is, ‘We want better, we want higher quality. We’re willing to pay a little more for it, but give it to us because we’re not going to eat the same old crap,’” Tristano said. “For the most part, they don’t care where that quality comes from—the convenience store, a deli, restaurant, etc.”

Additional pressure to perform is coming from two directions: fast-food restaurants and supermarkets, both of which are playing in the same arena.

“Most of the quick-service restaurants have raised the bar high with better quality,” Tristano pointed out. “Wendy’s just started selling natural fries with sea salt instead of the old ones. So now we’re looking at how QSRs have responded to pressure from convenience stores to raise the bar to get closer to what casual dining does, to be a lot more competitive.”

At the same time, supermarkets are enjoying the benefits of in-house food expertise and built-in foot traffic. “That retail meal solution option has been expanded. You see a lot of take-and-bake pizza specials on Friday nights at grocery stores, and a lot of it is more upscale,” Tristano said. “Whole Foods stores have up to 30 serving stations of different types of foods and ethnic cuisines. They also sell pizza, so there’s another big competitor for the c-store.”
Between consumers and competitors, Tristano added, “c-store operators cannot afford to lose focus.”

Why People Choose Pizza
Why do consumers choose pizza over other meal options? According to research by Chicago-based consultancy Technomic, it’s taste, ease and value–important information for any operator contemplating or already offering a gourmet pizza program.

In a Pizza Consumer Trend Report released earlier this year, Technomic found that 62% of those polled said their most recent away-from-home pizza purchase was “driven by a craving.” Another 25 % reported it was “more convenient than cooking.” About 20% said price, coupons and promotions influenced their decision.
Among the things consumers told Technomic about their pizza strategies:
• Approximately 93% of consumers said they eat pizza at least once a month. The
average consumer eats pizza nearly three times per month.
• Nearly one-fifth of consumers (17%) said that new items influence where they buy pizza. That sentiment is strongest among those aged 18-24 years (22%).
• About 41% of those questioned said they would like pizza establishments to offer healthier ingredients, such as whole wheat crusts (42 %), organic toppings and crusts (30% and 28%, respectively), and all-natural and locally-sourced ingredients (50% and 38%).

“Operators and suppliers will want to consider what they can do to elicit consumer cravings through adding new items to their menus and emphasizing them through their marketing message,” said Darren Tristano, Technomic’s executive vice president. “Differentiation through pizzas that feature unique flavors and taste combinations that consumers cannot purchase elsewhere or make at home will likely help support this effort. Positioning pizza as a meal solution that is easy, convenient and affordable will resonate with many consumers.”

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