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
 on 
June 15, 2022
Placer.ai Spotlight: Kroger’s Ghost Kitchens and Prepared Foods

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

Get 3 brand & industry
breakdowns every week

Subscribe to the newsletter

Great! Prepare your inbox for data-driven insights...
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.
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
Home Improvement and Decor Check In
Placer.ai Office Index: April 2024 Recap – Recovery Continues
Movie Theaters in Q1 2024: A Preview of Coming Attractions?
Let’s Get Physical: Fitness In 2024
Where Are Workers Returning to Office in 2024?
2024 Wins: Sweetgreen & First Watch on the Rise
A Full-Service Turnaround: Bloomin’, Dine, and Texas Roadhouse
Wendy’s and Denny’s: Breakfast and Late Night Dining Drives Success
Coffee Chains: Q1 2024 Update and What’s Changed Since COVID
Checking in with RBI and YUM!
Chipotle & McDonald's Serving Up Success
Wingstop & Shake Shack Continue Growing Their Reach 
Strong Start for Sprouts in 2024
Crocs’ Footwear Fairytale
Who Attends NCAA Final Four Events?
Eclipse Fever: How Did the (Retail and Hospitality) Stars Align?
Exploring Albertsons Companies’ Grocery Growth
Placer.ai Mall Index: March 2024 Recap – Malls Rise Again
Placer.ai Office Index: March 2024 Recap
Florida Spring Break Break-Up? Travelers Still Love Florida!
Provo-Orem and Ogden-Clearfield Emerging As Utah Hotspots 
Three Formulas for Experiential Retail in 2024
Aldi & Lidl Making The Cut
Texas Suburbs on the Rise
Exploring Luxury Hotel Brands’ Guest Segmentation
The St. Patrick’s Day Effect
How Can JOANN Make a Comeback?
Panera Bread Well Positioned for Possible IPO
Who Will Benefit From Family Dollar’s Downsizing?
Dave & Buster’s and Main Event Entertainment: Food and Fun for Everyone
Darden Brands: Location Analytics and Consumer Behavior
Nike and lululemon: a Strong 2023, Sprinting into 2024
Where Is Retail and Dining Foot Traffic Thriving in Early 2024?
Placer.ai White Paper Recap – February 2024
Three Retail & Dining Chains That May Surprise in 2024
Specialty Discount Chains Rock Retail Therapy
Placer.ai Mall Index: February 2024
Placer.ai Office Index: February 2024 Recap
Ulta Beauty Continues To Shine
First Watch Sails Into 2024
Hibbett Sports and DICK’S Sporting Goods: A Psychographic Analysis
Checking in With Discount & Dollar Stores
Peeking Behind The Curtain: Movie Theaters in 2023 and Beyond
Diving Into Brick-and-Mortar Eyewear
Getting Into Gear: Exploring The Auto Part Industry
Recapping Valentine’s Day 2024 Foot Traffic Trends
Fitness: A Strong Start to 2024
Dutch Bros. Continues To Percolate Visits
Super Bowl 2024: Placer.ai’s Postgame Foot Traffic Analysis
CAVA & sweetgreen Are On the Rise
Hats Off For Off-Price
Who Is Shopping at Malls?
Drilling Down Into Home Improvement
Walmart, Target, Costco & Superstore Space 2023 Recap
Catching Up With Shake Shack and Wingstop
Something To Chew On: Demographic Shifts at Steakhouse Chains
Placer.ai Office Index: Looking Back at 2023
Recapping RBI & Yum! Brands’ 2023 Foot Traffic Performance
Placer.ai White Paper Recap – January 2024
Who Shops at Anthropologie and Urban Outfitters?
Three Taco Chains to Watch in 2024
Starbucks and Dunkin’: 2023 in Four Data Points
Who Visits CVS and Walgreens?
Fashionably Frugal: Apparel in 2023
Catching Up With Fast Food
The Grocery Sector in 2023: An End-of-Year Recap
3 Mall & Shopping Center Trends for 2024
Bakery Chains Rising To The Top
Placer.ai and Esri Partner to Deliver Geospatial Analytics
Tampa Tourism Trends
Going For The Green: The Changing Dynamics Of Country Clubs
Christmas Day Dining Recap
Major Urban Shopping Districts – Holiday Season Recap
Placer.ai Office Index: December 2023 Recap
Recapping the 2023 Holiday Shopping Season
Placer.ai White Paper Recap – December 2023
7 Retail & Dining Segments to Watch in 2024
Diving Into Holiday Season Favorites
Super Saturday and Christmas Eve Eve: A Winning Combination
3 Budget Grocery Chains Finishing 2023 On a High Note
Making It In America: International Chicken Chains Bring The Heat
Domestic Tourism at a Glance: A Q3 2023 Roundup
Five Pizza Chains On The Rise
Jewelry Brands Taking Advantage of the DTC Opportunity
Secondhand News: Kids' Thrift Shops
Recapping 2023’s Dining M&As
MetLife Stadium Kicks Off Football Season
Placer.ai Office Index: November 2023 Recap
Small Coffee Chains Brewing Big Success