Thanks for Visiting!

Register for free to get the full story.

Sign Up
Already have a Placer.ai account? Log In

Placer.ai Spotlight: Kroger’s Ghost Kitchens and Prepared Foods

By 
Shira Petrack
June 15, 2022
Placer.ai Spotlight: Kroger’s Ghost Kitchens and Prepared Foods
SHARE
Explore our free tools to get timely insights into key industries
Check out the latest trends for
No items found.
Key Takeaways

Foot traffic to some of the Kroger Company’s biggest brands may be lagging slightly, but the success of the company’s prepared foods expansion and recently rolled out ghost kitchen collaboration hints at the supermarket giant’s growth potential. 

Kroger Brands YoY & Yo3Y Performance

Following its strong pandemic performance, the grocery sector’s offline visit growth slowed in recent months as inflation and high gas prices continued to strain many consumers’ budgets. Still, nationwide year-over-year (YoY) grocery foot traffic was positive every month between January and May 2022 while year-over-three-years (Yo3Y) foot traffic remained close to pre-pandemic visit levels. 

The Kroger Company operates several supermarket banners including Fred Meyer in the northwest, Harris Teeter in the south Atlantic, Kroger in the midwest and Ralphs in California. Of the four brands, Ralphs posted the strongest visitation trends, with year-over-year (YoY) visits outperforming the wider category average almost every month this year. Meanwhile, Kroger, Fred Meyer, and Harris Teeter saw YoY and Yo3Y visit gaps over the past couple of months, with May 2022 visits to the three brands down by 5.0%, 6.7%, and 2.1% relative to May 2021. 

Still, despite their subdued foot traffic performance, the Kroger Company seems to have a not-so-secret weapon up its sleeve that could bring customers back to its supermarkets. 

Is Home Chef’s Success Driving Kroger Cross-Dining Down? 

Over the past couple of years, Kroger has invested in a variety of partnerships and acquisitions to expand and improve its prepared foods offering. For customers looking to simplify their home cooking, Kroger acquired Chicago-based meal solutions brand Home Chef in 2018 and rolled out the meal kits at select stores later that year. By October 2021, Home Chef products could be purchased at over 2,200 stores under Kroger’s various grocery banners. 

The chart below shows cross-dining data (the share of Kroger customers who also visited dining chains) for four of Kroger customers’ favorite dining chains between January and May 2019 and 2022. In all four cases, cross-dining numbers fell between 2019 and 2022, indicating that fewer Kroger customers visited McDonald’s, Chick-fil-A, Wendy’s, and Starbucks between January and May 2022 compared to the equivalent timeframe in 2019. 

Many factors are likely contributing to these trends, including consumers’ efforts to cut back on restaurant visits in the face of high inflation and gas prices. Still, at least some of the drop in cross-dining may be attributed to Kroger’s investment in its prepared foods selection. Kroger visitors can now pick up a Starbucks coffee and a variety of meal solutions ranging from ingredient-based kits to “heat and eat” dishes right at the grocery store. At least some customers are likely substituting their previous fast-food runs with Kroger’s prepared foods offerings, which could explain some of the drop in cross-dining.

Kroger’s Ghost Kitchen Partnerships

For customers looking for freshly prepared meals, Kroger has partnered with Kitchen United and ClusterTruck under two different collaboration models that provide diverse takeout and delivery options directly from the supermarket. Both models involve building on-premise ghost kitchens inside Kroger store. But while ClusterTruck offers a range of items under one brand, Kitchen United draws multiple restaurants – similar to a food court model, but without the on-premise dining. 

In our May 2022 Grocery Deep Dive, we looked at Kroger’s ClusterTruck partnerships in Indiana and Ohio and found that the locations with the ClusterTruck ghost kitchen were seeing stronger visit recoveries than neighboring Kroger branches. Foot traffic data indicates that the Kroger-Kitchen United partnerships are showing similar promise. 

Kroger’s First Kitchen United Location - Los Angeles, CA

The first Kroger-Kitchen United collaboration opened in a Los Angeles Ralphs store in early January 2022. Since then, visits to the location have skyrocketed, while foot traffic to nearby Ralphs stores as well as city and statewide Ralphs foot traffic patterns have remained relatively stable. 

Kroger’s Second Kitchen United Location - Houston, TX

In February 2022, Kroger opened its second Kitchen United ghost kitchen in a Houston Kroger-branded supermarket. Looking at the change in monthly visits since January 2022 shows that, since its opening, visits to the Houston Kroger with a Kitchen United ghost kitchen have outpaced nearby Krogers and both Houston-wide and Texas-wide Kroger foot traffic averages.

So far, the ClusterTruck and Kitchen United ghost kitchens only operate in a tiny fraction of Kroger’s massive and nationally distributed store fleet, but foot traffic data from locations with ghost kitchens are already demonstrating the significant gains that come from this concept.   

For more data-driven grocery and retail insights, visit placer.ai

Learn how downtown regions across US cities are measuring up with our free tools.
Check out the latest trends for
No items found.

Related Topics

Explore our free tools to get timely insights into key industries
Check out the latest trends for
No items found.
SHARE
Get 3 brand & industry
breakdowns every week
Subscribe to the newsletter
Oops! Something went wrong while submitting the form.

Get a Demo

Please enter your first name
Please enter your last name
Please provide a valid email
Please enter your email
Please enter company name

Thanks for reaching out!

One of our experts will be in touch soon

Try Placer.ai Free
Oops! Something went wrong while submitting the form.

Recent Publications

Get 3 brand & industry breakdowns every week

Subscribe to the newsletter
Checking in With Department Stores: Nordstrom and Macy’s
Superstores and Wholesale Clubs Ahead of the Holidays
Home Depot and Lowe’s Heading Into the Holidays
Starbucks and Dutch Bros: Short Visits Lead the Way
Planet Fitness: Raising the Bar(bell)
Checking in With Full-Service Restaurants: First Watch, Chili’s, and Outback Steakhouse
RBI and Yum!: QSR Resilience in 2024
Boot Barn and DSW: Stepping Up Their Game
Target’s October Circle Week: A Data-Driven Snapshot
Chipotle, Shake Shack & Wingstop: Dining Success in Q3 2024
Playa Bowls and Tropical Smoothie Cafe: Berry Big Business
Cheesecake Factory & BJ’s Restaurants: Full-Service Success
Checking in on McDonald's and Wendy's 
Sprouts Farmers Market: A Specialty Grocer With a Traditional Twist
CAVA: The Craze Continues
Placer.ai Reaches $100M Annual Recurring Revenue
Catching Up With Carter's 
A Texas Roadhouse and LongHorn Steakhouse Showdown
Placer.ai Mall Index: September 2024 Recap – Labor Day Peaks and Holiday Season Predictions
Albertsons Q3 Check-In
Looking Ahead to the 2024 Holiday Season
Trader Joe's: Continuing to Thrive in 2024
Bowlero and AMF: A Ten-Pin Knockout
Recreational Retail: Store Performance in 2024
Placer.ai White Paper Recap – September 2024
A QSR and Fast-Casual Face-Off
Sam’s Club’s In-Store Retail Media Network Opportunity
The Rising Stars: Six Metro Areas Welcoming Young Professionals
Costco in 2024: A Deep Dive
Sherwin-Williams in 2024: Brighter Than a New Lick of Paint
Life Time and Orangetheory: Premium Fitness Flourishing
C-Stores: More Than A Pit Stop
Darden: Dining Dominance Undeterred 
Placer 100 Index for Retail and Dining: August 2024 Recap
Placer.ai Office Index: August 2024 Recap
Placer.ai Mall Index: August 2024 Recap – Back-To-School In Full Swing
Auto Parts Retailers: The Traffic Continues
Pumpkin Spice Works its Magic Once Again
School Season Sparks Retail Growth
Placer.ai White Paper Recap – July & August 2024
Big Lots’ Big Rightsizing Move in Four Data Points
Fun Away From The Sun: Checking in With Eatertainment
Domestic Migration and Population Growth: Strong Currents Off The Carolina Coast
The Civic Impact of Summer Events
Retail Trends in College Towns: A Back-to-School Snapshot
Five Below and Ollie’s Bargain Outlet: Consumers Still on the Hunt for Discounts
Macy’s & Bloomingdale’s: Into 2024 and Beyond
Limited Time Only: The Trend Continues
Beauty in 2024: Many Ways to Win
Dollar General & Dollar Tree: Powering Ahead in Q2 2024
The Home Depot and Lowe's Foot Traffic Remodel in Q2 2024
Superstore Update: Summer Savings Spree
Placer.ai Mall Index: July 2024 Recap – From Fourth of July to Back-to-School
Placer.ai Office Index: July 2024 Recap
Summer Movie Madness: Blockbuster Films Boost Foot Traffic
Driving Success: Toyota in 2024
Denny’s and IHOP: An All-Day Breakfast Matchup
Warby Parker: Seeing Clearly Now
Planet Fitness at the 2024 Halfway Point
Serving Summer 2024: RBI and Yum! Brands Q2 Foot Traffic
Starbucks, Dutch Bros., Dunkin’: Finding Summer Success
Fast Food and Fast Casual Favorites, Plus CosMc’s Takeoff
Chipotle and Sweetgreen: Fast-Casual in Q2 2024
First Watch, Texas Roadhouse, and Applebee’s: An FSR Roundup
Albertsons Companies: H1 2024 Recap
Teaming Up For Success: Sports Stadium Sponsorships
Limited Time Offers: Price Wars Boost Visits
Placer 100 Index for Retail & Dining: June 2024 Recap
Placer.ai Mall Index: June 2024 Recap
Placer.ai Office Index: June 2024 Recap
Inside Out 2: The New Blockbuster Bringing Crowds Back to Theaters
Petco and PetSmart: A Head to Head
Frozen Delights: Exploring Ice Cream Chains Across America
Placer.ai White Paper Recap – June 2024
Barnes & Noble: Writing a New Story
Small Format Stores - Sprouting, Blooming, and Expanding
Retail and Dining on Father’s Day
Thrift Store Visit Scores
Charting Value Grocery’s Visit Growth
Placer 100 Index for Retail & Dining: Introduction and May 2024 Recap
Digging Into Darden: Q2 2024 Update
2024 Retail and Dining Trends Update
TRU and avid: Midscale Hotels on the Rise 
Diving Into Kroger: A Strong Start to 2024
Placer.ai Mall Index: May 2024 Recap – Mall Visits on the Rebound
Placer.ai Office Index: May 2024 Recap
2024 Memorial Day Recap
Las Vegas: A Tourism and Migration Deep Dive
Eatertainment Chains: Full on Food, Fun, and Foot Traffic
The Promise of Luxury Apparel
Catching Up With Ulta Beauty & Gap Brands
Ollie’s Bargain Outlet and Five Below: Q1 2024 Treasure Troves
CAVA Still Going Strong
Driving Success: Auto Parts Chains in 2024
Checking in With DICK’S Sporting Goods
Mother’s Day Shopping and Dining Trends
Placer.ai Mall Index: April 2024 Recap – Retail Resilience Heading into Spring
Dollar Stores Still Gaining Momentum
Off-Price Apparel Chains After Q1 2024: Demographics in the Balance
Walmart, Target, and Wholesale Clubs Continue to Thrive