Great Britain’s supermarkets and convenience food stores are ideally placed to profit from two big celebrations taking place in 2012: The Queen’s Jubilee and the Olympics.
Faced with falling sales (even Tesco profits are down) Britain’s stores, like others across Europe, are facing lower turnover. But with two major celebratory events planned for this summer, British stores are hoping to see sales increasing. Surprisingly, in this sports-mad nation, hosting the Olympics is not providing the golden opportunities stores would have expected. Instead, it is the old-fashioned celebrations for a royal event that provided the catalyst for a bonanza for stores. Street parties used to be popular in Britain, but recently people have tended to become more sophisticated and take off for the day by car instead.
However, this year, people decided to stay at home and join neighbors in a good old-fashioned party. It was estimated that over six million Britons met up over celebratory street parties, which meant huge party food and drink sales for supermarkets and stores. Figures aren’t in yet for June’s Jubilee celebration, but when faced with empty shelves caused by a massive buying spree the day before the celebrations kicked off, no Manager was going to be too unhappy. Even in Chelsea, the most up-market part of London, one afternoon saw shelves of the local Waitrose swept bare, with staff frantically trying to fill them up and keep pace with customers making last-minute buys for Jubilee street parties, in honor of The Queen’s 60th Anniversary on the throne; not normally something that is seen in this millionaires’ sector. Aided by marketing from the big stores, outlets across Britain were besieged by street party organizers for supplies of food and drink to commemorate the anniversary.
This time, to keep costs down, organizers tended to put out chairs and tables, and then tell everyone to bring their own food. Several street parties were so popular the tables extended over one kilometer. This meant most guests bought food for their family, and then added a bit more for friends – therefore overbuying in the food department. Supermarkets were full of innovative ideas for Party food; and suppliers for BBQ food, wines and beers, ice-cream etc., are expecting that June will show increased turnover. Signs are encouraged by neighborhood participation in street parties. 10% of Britons are estimated to have taken part in a Jubilee party, and store managers now look to other events in the future to encourage sales.
It wasn’t only in Britain that Jubilee parties encouraged sales. In Europe, especially rural areas of France and Italy, British ex-pat communities were bringing the street party concept to their area, holding big parties and inviting the neighbors. In Britain, Morrisons did some clever marketing, and sponsored some street parties. The catalyst that got neighbors together was Morrison’s Managers saying they would provide certain amounts of free food. Neighbors then decided to build an event around this generosity, and orders were placed for food for lunch, teas and suppers that went on all day, with food being bought at the local Morrisons!
Waitrose grabs the prize
Probably the most up-market venue for a store to supply food has to be Buckingham Palace. Waitrose was chosen to supply a picnic for 10,000 people, invited by The Queen via a ballot to picnic in her garden at Buckingham Palace. Eventually eight massive lorry-loads of food trundled into the forecourt of Buckingham Palace, after having loaded up at their Leicester depot. The food for the picnic was thought up by the Queen’s chef, Mark Flanagan, together with Waitrose’s Product Developer, Graham Cassie, and their star celebrity chef, Heston Blumenthal. All guests were given a starter of two sorts of salmon (smoked and poached), a special chicken dish, a bottle of wine (or non-alcoholic drink) and a pudding, made from British strawberries, rose water and elderflower cordial, topped with a marble cream and crumble topping. Announced in the press beforehand, this pudding proved to be a winner, for Waitrose. Some of the ingredients were difficult to source, but could be obtained in local Waitrose stores. It inspired shoppers to snap up the key ingredients at their local and make the pudding for their own Jubilee parties.
• Waitrose quadrupled its normal weekly supply of whipping cream
• Tripled its normal order of golden caster sugar
• Sales of Elderflower cordial soared 1,000 per cent,
• Rosewater – which gives the dessert a distinctive fragrant quality – has been selling at 52 times its normal rate.
• Meringue shells, which form the pudding’s topping, are selling at 20 times the levels the supermarket would normally expect.
Cassie says “the demand for ingredients has been astonishing with customers desperate to recreate this dessert for their friends and family: any store that wants to copy the recipe can find it on Waitrose’s website.
So why is the Queen so popular – and not the Olympics?
Although the Olympics is yet to happen, there has been no surge in neighborhood events to commemorate them. Before there can be a street party, organizers have to apply well in advance for permission to close their road. Over 10,000 applications poured in for street closures for the Jubilee, twice as many as there have ever been before. But there have been few for the Olympics. Why? Possibly one word – greed. As soon as London won the right to host the Olympics, Sponsors were tied in to deals for fast food supplies on the games’ site. Any outlet thinking of selling an ‘Olympics Burger’, but hadn’t paid the millions being asked for sponsorship, found a heavy-handed legal team descending on them. One butcher made an innovative display using sausages depicting Olympic rings. Hitting him like a ton of bricks came a draconian demand from the Olympics’ legal team to withdraw his display. The public were not amused, and in the consequence food marketing boys have tended to stay away from ‘win Olympic tickets’ themed promotions in supermarkets. Olympics organizers promised only fresh, locally sourced and British food would be offered on the Olympic site.
Obviously no-one told McDonalds, and there was an outcry when Games supremo, Sebastian Coe, announced that only 10 per cent of chicken at McDonald’s venues would be British-sourced. At the time it was claimed there wasn’t enough chicken in the country to satisfy demand. However, after a massive outcry from the public, they have clearly found more chickens. McDonald’s UK has now announced chicken will come ”from our existing UK supply and it is possible because of the recent increase in volumes of British chicken breast meat we have been purchasing”. The rest have also had to climb down and an Olympics spokesman now says ”All of our chicken is British and Red Tractor assured. McDonald’s will also only serve British chicken in their four restaurants at the Olympics. But it was too late for the major supermarkets, and enough bad publicity has turned the public away from sport to the safer topic of The Queen and her Jubilee.
BBQs
When it comes to grilled food, almost every garden has an open-air grill for BBQs. Many supermarkets will now group suitable meats, oils and dressings, and even marinades, all together to make it easier for customers to collect the ingredients. Stores are also coming up with ‘value-added’ items for party organizers; one staple at a barbeque is bread, but the trend today is for more exotic types, including focaccia. Lanterna makes the authentic Genoese focaccia, plain or topped with vegetables, herbs and cheese, which are becoming popular with hosts that want to serve “something different” to the neighbors. Advertised as being drizzled with extra virgin olive oil, Lanterna has adopted a ‘healthy eating’ policy, and says the whole focaccia range does not contain any animal fats; in fact lard has been replaced by extra virgin olive oil. As cooking on a BBQ is generally seen as a male job, stores are hoping that customers will be building on the Olympics (seen as a male-bonding experience), ask fellow males around to watch events on the TV, and serve up grilled meats and beers whilst they sit down to watch.
Birds Eye up for sale
One firm that may be able to take advantage of any surge in providing party food is Bird’s Eye, the British frozen food firm famous for its seafood products (they manufactured 2.2bn fish fingers in 2011). They have recently gone into the grilled and party foods market in a big way. Amongst products making strong headway are Aberdeen Angus Burgers, Waffles, Chicken dippers and Peri Peri Chicken. Now, Asian firms are in the hunt for major food manufacturers and Birds Eye is the latest to catch their eye. A Thai food manufacturer has put in a £2.5bn bid for the company, barely a week after Chinese state-owned Bright Foods bought a controlling stake in the breakfast cereal maker Weetabix. Permira, the private-equity firm, has put the Birds Eye Iglo group up for sale five years, after buying it from Unilever for £1.4bn. It recently reported a 7% cent rise in annual profits to £267m on the back of rising sales of frozen fish, poultry and vegetables. However, it is believed that at least two other private-equity investors, Blackstone and BC partners, are reported to be making rival offers for Birds Eye.
Brits embrace low alcohol beers ahead of summer of celebration
With the party season in full swing, supermarkets are investing in cooler cabinets to sell beer. Customers can choose their picnic food and a 6-pack of beers at the same time. And following the trend towards low-calorie content, Supermarket sales of low alcohol and non-alcoholic beers are at an all time high, with Tesco reporting an increase of 47% year-on-year and Sainsbury’s an increase of 26%. Andy Tighe from BeerGenie comments: “The UK Government’s halving of beer duty in October 2011 on beers of 2.8% ABV and below has led to an explosion in innovation from breweries across the country. These lower alcohol beers have been brewed in a diverse range of beer styles from light lagers, to shandies, soft milds, hoppy pale ales and earthy or chocolatey stouts.” Supermarket giant Tesco has already widened its low alcohol beer offering to meet expected demand. Tesco’s specialist beer buyer Chiara Nesbitt comments: “The growth, particularly for non alcohol beers, is remarkable, as they were previously frowned upon by drinkers who considered them thin and tasteless.”
Future
With signs that food sales are soaring in Britain’s supermarkets, stores are hoping that the credit crunch will mean more customers staying at home, and choosing to buy party food, BBQ staples etc. from their local stores. Stores such as Marks and Spencer, Tesco, etc. have major advertising campaigns, offering ‘celebration meals for two for under £10’, which have proven to be a big hit. Building on the trend for entertaining at home, stores are making it easy for working customers to grab all the ingredients for a meal, including the main course and vegetables, a pudding and wine to accompany the meal – all for ‘under £10’ for 2’.
Party Service
And for customers who don’t even want the trouble of cooking, many supermarkets in UK offer a special Party Service. This is particularly popular for Summer Garden parties, and again for the Winter Party season. It started with supermarkets offering to lend customers glasses for free, provided they purchased to the drink to go in them from the store. Then it extended to things such as fish kettles, etc. It wasn’t long before marketing departments saw the possibilities, and now most major supermarkets, and many small ones, have a special desk with helpful staff who assist customers through their party planning, and can suggest the store makes main courses, canapés, puddings or anything else the customer doesn’t have time to do themselves. So the party season is going well – and soon it will be Christmas!