Grocery Stores Draw Millennials With In-Store Restaurants : The Salt While grocery stores had been losing customers to smaller markets and online shopping, "groceraunts" — with seasonal menus and alcohol — are luring back foot traffic to the old-school grocers.

Grocery Stores Draw Millennials With In-Store Restaurants

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Imagine going to the grocery store for dinner, not just to pick up a bag of corn chips and cheese dip for dinner and eat it at home, but actually eating in the supermarket. Many markets are adding sit-down restaurants. Kristofor Husted of member station KBIA in Missouri reports.

KRISTOFOR HUSTED, BYLINE: At the Hy-Vee grocery store in Columbia, just past the produce aisle, in between the sushi and deli counters are glass doors marked with the words Market Grille.


HUSTED: Inside, it's happy hour. There's music playing, and TVs showing sports. Thirty-year-old Rob Hunt grabs a booth with his friend and opens the menu featuring half-off appetizers.

ROB HUNT: We've been coming almost every Wednesday this summer for our after-work beer.

HUSTED: All of the ingredients for the menu come from the store. They're cooked in the kitchen and served here. Hunt says the variety of food, the local craft beer on tap and, ultimately, the price are a big draw.

HUNT: You can't get $2 pints of beer anywhere else. And that's honestly (laughter) like the biggest thing. We tried a couple other places this summer. And they were fun. But it's just cheaper here.

JEREMY GOSCH: We just thought it was the next natural step to add restaurants that have, you know, a full-service bar.

HUSTED: Jeremy Gosch is an executive vice president with Hy-Vee.

GOSCH: You know, a seating area apart from the store - different ambiance, different lighting, different atmosphere, different sound, different music, full service.

HUSTED: Across the country, supermarkets like Whole Foods have been offering sit-down dining and drink deals for years. The trend of adding full restaurants, sometimes called groceraunts (ph), falls in line with the uptick in prepared store meals, which has grown 30 percent since 2008 and driven $10 billion in sales last year, according to restaurant research groups. Jeremy Gosch says people are looking for more options in prepared foods. And the traditional center of the store with cans of beans and boxes of cereal has had to make room.

GOSCH: I think as you look long-term and we continue to roll out into existing stores, you know, from food service updates and expansion, especially on meals to go for consumption at home, I think you'll see a little bit of that compression.

HUSTED: A large part of this shift is thanks to millennials who are more likely to dine out than other generations. Millennials surveyed by a financial services firm, Morgan Stanley, were 10 percent more likely to have eaten out in the past week. Today, groceraunts are hiring Culinary Institute of America graduates as chefs and featuring seasonal menus. Food Industry Analyst Phil Lempert says that also appeals to millennials.

PHIL LEMPERT: So what these groceraunts can do is give them a convenient location where they can meet their friends, where they can have great food and have it at a great value. So that becomes, you know, a terrific formula to attract this generation.

HUSTED: Millennials are also turning away from slumping restaurant chains like Chili's and Applebee's, which plans to close up to 60 locations this year. That's forcing some chains to look toward grocery stores as potential partners. Think of Starbucks and Caribou coffee kiosks in grocery stores, except in this case, Wolfgang Puck wants his cafe to become the in-house restaurant.

LEMPERT: Now these restaurateurs want their space in the supermarket as well because they know that it's more convenient for people. It's more of a one-stop shop. And it's hurting their traditional restaurants.

HUSTED: Phil Lempert says the next step may be to add home meal-delivery options. Food marketers are looking at the Amazon purchase of Whole Foods and seeing both more groceraunts and groceries and dinner being delivered together. For NPR News, I'm Kristofor Husted in Columbia, Mo.

SIMON: And that story comes to us from Harvest Public Media, a public radio reporting project that focuses on agriculture and food production.

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