Why are retail destinations enhancing and enlarging their F&B offering?
The food and beverage sector (F&B) has changed dramatically in recent years, not only in terms of the size of the market but also in the diversity and quality of offer. As rental prices continue to rise in Europe, spaces that were previously dominated by fashion retailers are now being inhabited by trendy gastronomic restaurants. People have moved away from collecting ‘things’ to collecting ‘experiences’ and shopping centres have adapted to this change by enhancing and enlarging their gastronomic offer.
In the foodie era, customer experience is key and begins before people even step foot inside a restaurant. Now more than ever, choosing between one restaurant and another depends on the online ratings given by other guests and through social media, everyone now has the ability to be a food critic. Customer review sites, social media and dining apps offer consumers more insight into what they can expect from a restaurant, in terms of food quality, waiting times and service. They also allow people to compare prices, make table reservations and add guest notes. In return, these websites gather information about individuals to tailor their menus and improve customer satisfaction.
Overall, people are looking for an experience that combines price, quality, origin, innovation and personalisation. They also expect connected experiences, where the physical and digital coexist in the same customer journey – known as the phygital phenomena. The rising trend in online food delivery has revolutionised F&B retail, and more and more people are now using services such as ‘click & collect’. At Hyphen, we’ve experienced an increasing number of clients looking for help in delivering logistics and distribution centres, in addition to their stores, in order to support developments in their omnichannel offering.
This trend was echoed earlier this year when I attended the Hospitality Innovation Planet (HIP) event in Madrid. This event explored changes in the hospitality sector, with a focus on enhancing customer experience through digital services. It was interesting to learn that, in the next five years, the most important areas for technological development in the hospitality sector will be: personalised customer experience through ‘big data’ (37%), loyalty programs (25%), more payment options (25%) and the adoption of robots and service automation (8%).
It’s clear that F&B plays a huge part in attracting shoppers to retail destinations (increasing dwell time, spend and overall sales growth) and for this reason, it is one of the key ingredients for retail success.