Unhealthy is the New Healthy
We spend a fair amount of time talking to and working with hospitality businesses from start-ups to chains who are all looking to nail the perfect customer proposition. Owning a small chain of three pasta bars myself, I’m all too familiar with the challenges facing restaurants and fast food concepts to nail the right brand positioning.
One of the most common themes of discussion is the relative merits of a ‘healthy’ brand proposition to tap into the healthy eating consumer movement. Having recently had the same conversation once again – this time with a start-up looking to launch in the Melbourne CBD – I thought I might share my insights into the healthy eating brand space for the restaurant category.
01. The Healthy Eating Movement is a Thing
The Healthy Eating Movement is well documented. Never before has there been so much awareness of the importance of eating well. Paleo, gluten free, vegetarian, vegan, low fat, low preservative, and low GI are just some of the ways people are thinking about eating.
02. But the Thing isn’t as Big as it Seems
But the volume of popularity is not playing-out at the counter or table when it comes to ordering. When developing our concept the number one and two reasons people gave us for giving-up before we started were: 01. ‘Too many carbs in pasta’, and 02. ‘Too difficult to manage the gluten free customers.’ As it turns out, roughly half of our customers are women, and although we get asked a lot about a gluten free option, and although we have found an amazing rice flour and egg cassarecce, it accounts for less than 2% of the pasta we sell. My conclusion is that the noise of the Healthy Eating Movement does not equate to what people choose to eat in nearly the same proportion.
03. Market Share and the Way Consumers Buy.
At play is the geographic pulling power of a concept – size of market based on likelihood of them considering you as being located nearby. If you’re launching a casual dining/take away concept in the CBD, your pulling power (where the vast majority of your customers will come from) is around 1-2 blocks. In a Shopping Centre your pulling power is those already shopping in the Centre, for a strip it is those who work within 5 minutes walk or live within 5 minutes drive (these numbers are imperfect measures, but you get the point). If your restaurant is more formal than casual, then your pulling power can magnify by 2-3 times, and for a restaurant with a strong reputation, your audience can be city-wide, or even international.
The second factor is competitive demand. How many other food offers at a similar price point sit within your ‘pulling zone’?
The third factor is pure maths – how many people in your pulling zone, when they think of buying lunch or dinner will consider your offer (based on personal taste preference, price, location, service and food quality)?
04. All that Glitters is not Healthy
A misconception that comes with any consumer movement is that more = better. In the case of the Healthy Eating Movement, many people we talk to believe the healthier their offer, the more successful they will be. This is an interesting insight, as typically with branding this mindset is a good one, but not necessarily when it comes to healthy eating.
If we start with those people who don’t want to eat healthy (think; Burgers, Pizza, Fish and Chips, Chicken and Chips, deep fried Schnitzels, loaded Milk Shakes) this is by far the largest section of the market. We talk about the three Crave Factors for food concepts – Fat, Sugar and Salt. Any concept that is based on one of these crave factors has a distinct advantage over those who are not.
Then if we think of those who want to tell themselves they are eating healthy when they aren’t really (think; Subway, Juice & Smoothie Bars, Mexican, etc.) we have a much smaller section of the market to draw customers from.
Then consider those offers that are mainstream healthy (think; Pasta, Asian food, Salad Bars, Baked Potatoes, Sushi, Rice Paper Rolls, Protein Bowls, etc.) the market is smaller again.
Unfortunately as we get healthier, reducing fat, sugar and salt the crave factors diminish. As crave diminishes, so-too does the sense of; ‘treat’ and the appeal for us to pay someone to make this meal for us.
Take this last and smallest market, apply all the factors (including price-point and pulling power) and the result is a very small customer base from which to build a sustainable level of sales. Our insight; the healthiest end of the market may have alot of theoretical popularity, but too few customers to build a healthy casual dining business.
05. Healthy Sales not Healthy Food
From our knowledge of the market where there is a Burger offer (high crave, low healthy), a Pasta offer (mid-crave, mid healthy) and a Baked Potato offer (low crave, high healthy) in the same strip of shops, sales figures will be double for the Burger than the Baked Potato with the Pasta in between the two.
06. When Healthy is Most Effective
The ‘healthy’ brand proposition is all about permission to eat. I feel better about my choice because it is better for me. Where this plays-out most powerfully is where the food offer is high crave (not particularly healthy) but the brand proposition is healthy.
Grill’d burgers in Australia is one of the most impressive players in the fast casual category with a ‘Healthy Burger’ brand proposition. The branding doesn’t promise that burgers are healthy food, more that if you’re craving a burger, theirs is the healthiest.
Likewise, Sandwich Bar chain ‘Healthy Habits’ offers a range of food that are not strictly health food, but using fresh ingredients and having some healthier options than traditional sandwich bars gives them permission to promote a ‘healthier than our competitors’ brand proposition.
The bottom line is consumers want a treat. They don’t spend their hard-earned eating out healthy, partly because they can do that at home. The psychology of eating out is to treat yourself, and the foods that do that most effectively are high in sugar, salt and fat – the ‘crave trilogy’. The most effective ‘healthy eating’ brand proposition is to be the healthiest option in a high crave category. That isn’t to say you can’t build a genuine healthy eating fast casual business, but you need to start by understanding the compromises to market size and crave level that will impact demand.
David is the founder of Truly Deeply, a brand agency with 25 years experience working with brands to position them for growth. His deep expertise is in the creation of high engagement brands that attract the attention of their audience and stand out from their competitors. David has extensive experience working with corporate, retail, food & beverage and entrepreneurial clients. Find out more here
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