Davis ThinkingVirtual retail spaces have the potential to repurpose transitional urban spaces for entirely new uses.
Some of the most familiar names in the restaurant world are moving into the grocer's freezer. P.F. Chang's, Burger King and Jamba Juice all have recently licensed their names for new products to be sold in supermarkets. They join other high-profile restaurant chains including Marie Callender's, Starbucks, T.G.I. Friday's and California Pizza Kitchen, which already have substantial presence at the grocery store.
In the days ahead, a clue to the long-range growth strategy of Starbucks Corp. will become apparent, though not at its vast chain of coffee shops. Instead look down the coffee aisle of your local grocer. Starbucks is rolling out Via instant coffee—so far sold only in its own shops and a couple of retail chains—to tens of thousands of supermarkets, mass merchandisers and other outlets in coming weeks. The product's migration from coffee counter to grocery aisle reflects one of the food industry's hottest trends: putting more restaurant brands like California Pizza Kitchen and P.F. Chang's China Bistro into grocery aisles.
Target Corp., under pressure from an activist shareholder, is using fresh foods and other recession-proof groceries as the cornerstone of a plan to quiet criticism and reverse a slide in sales. The Minneapolis-based retailer, best known for its fashionable merchandise and jazzy marketing savvy, is pinning its rebound hopes on a distinctly unchic notion: transforming a corner of its discount department stores into a grocery store.
As the economy plunges into a deep recession, grocery stores are one of the few sectors doing well. That is because cash-short consumers are eating out less and stocking up at the supermarket. And store brand products, which tend to be cheaper than national brands and more profitable for grocers, are doing especially well.
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