Tony Smith’s Post

The lines between grocery, restaurant, and convenience aren't just blurred for us in the industry; customers don't care about the lines. Placer.ai's data shows an increasing consumer shift towards grocers, superstores, and c-stores, outpacing traditional restaurant traffic. There is a broader industry challenge: adapting to evolving consumer preferences and economic concerns, urging a strategic rethink in service and value.

Thanks to the great Jonathan Maze from Restaurant Business Online for including Placer.ai data in his recent update on #grocery, #cstores, and #restaurant visitation trends. There are a number of reasons why we've seen visits to grocery stores, superstores, and c-stores outperform restaurants the past several years, but a lot of it comes down to affordability. Even as food inflation has started to moderate, it's been interesting to see that consumers are still willing to visit a wider number of food retailers than ever before as they seek out deals. #locationintelligence #locationanalytics #restauranttechnology

I don't think anyone who follows the restaurant industry will be surprised by the statistics in this article from Restaurant Business Online (https://lnkd.in/ehcs_TFA). In short, restaurants are losing traffic to retailers - particularly supermarkets and convenience stores - which have upped their game when it comes to prepared foods. And while the focus may be on prepared foods, the reality is frozen and refrigerated prepared foods have also improved giving prepared foods overall a run for their money. The longer this situation plays out, the more fundamentally consumer behavior will change for the long-term. Their expectations from restaurants will shift, their perception of value will change, and the role restaurants play in their lives will be altered. There's no easy answer here as restaurants continue to struggle with rising costs and labor shortages. Fine dining restaurants are benefiting as they offer strong value propositions based on consistently excellent hospitality, food and beverages, but this segment can't power the foodservice industry. Ultimately, we need bold innovation not only in menu offerings but operational formats to meet consumers where they are now and where they'll be in the future. #menumatters #foodservice #restaurants #foodandbeverageindustry #consumerinsights #consumerbehavior #cpg #hospitality #trends2024 #innovation #retail

Yes! I see this happening everywhere, from the big chain grocery stores serving sushi and pizza to the mini-mart gas stations serving spaghetti and chicken. I love that Restaurant Business is dedicating a column to the topic! #restaurants #foodservice #trends

As the fast-food industry battles shrinking foot traffic and rising costs, major chains like McDonald’s and Wendy’s are leveraging strategic price bundles to attract value-conscious consumers. Yet, with McDonald’s reporting a decline in sales growth and Wendy’s exploring dynamic pricing, the sustainability of such promotions remains in question. Restaurants must balance enticing deals with profitability, considering new menu innovations and loyalty programs to sustain customer interest. As Modern Retail analysts suggest, the challenge lies in finding a pricing model that maintains customer appeal while managing operational costs in an increasingly competitive market.    Our Take 💭 Things move at a fast pace in casual dining and quick services restaurants. That is the point: readily available value-priced meals, often grab and go, chosen from menus are reliable and appealing, and experiences that breed loyalty and repeat visits. And it is far from easy!   Restaurant brands need to be nimble to reach, engage and compete for customers, bringing them back to the table through promotions, new menu items and even the announcement of new locations or regional expansion. In an increasingly competitive market, where and how you allocate media spend is an exercise that needs to be as responsive and effective as you are.   Measuring and optimizing marketing performance is essential to achieving equilibrium in the operations of your business. Finding the right partner to help you achieve it should be the easy part. To learn more about how we can support your media scenario planning, contact us today at [email protected].   Read the full article, “Fast-food chains like McDonald’s & Wendy’s are locked in a price war” on Modern Retail: https://lnkd.in/emvu6GFT

According to the Bureau of Labor Statistics, restaurant prices have surged by 27.2% since June 2019, a spike that has led many to tighten their belts when it comes to eating out. In response, major players like McDonald's, Burger King, and Taco Bell are doubling down on value promotions, rolling out enticing $5 meal deals and other budget-friendly options. This focus underscores a broader shift in the fast food industry, where innovation is not just about new menu items or technology, but also about rethinking pricing strategies to keep pace with consumer needs. It's a reminder that in a rapidly changing market, those who adapt and meet customers where they are will continue to thrive. #FoodTrends #ValueMeals #RestaurantAdaptation #MenuInnovation

“As many restaurant companies prepare to report their second-quarter results, investors are expecting to hear that diners are visiting their locations less frequently and that sales have turned sluggish, with few exceptions such as Chipotle. In the hopes of lifting their results for next quarter, chains such as McDonald’s, Taco Bell, Burger King and Wendy’s have unveiled or revived meal deals with a $5 price tag.” “Fast food typically fares better than the broader industry during economic downturns. But the last several years of price hikes have led many consumers to conclude that fast food just is not a good deal anymore. More than 60% of respondents to a recent LendingTree survey said they have cut back their fast-food spending because it is too expensive.” “Runaway menu prices have scared off many fast-food customers, including those in the low-income bracket who make up a sizable chunk of the sector’s customer base. Sensing diners’ fast-food backlash, players such as Brinker International’s Chili’s have used their marketing to highlight their own value relative to the cost of a fast-food meal. Casual-dining chains have taken some market share from the fast-food sector, Darden Restaurants CEO Rick Cardenas said in June.” “Generally, fast-food chains tend to focus their discounts and value meals on the first quarter, when consumers are trying to save their dollars after the holiday season and stick to New Year’s resolutions. As temperatures rise, so do restaurant sales, and operators usually do not need to rely on deals to bring in customers.” “But this summer is different. Fast-food chains need discounts to fuel traffic — and sales growth.” “Without convincing customers to add a milkshake or another entrée to their order, the discounts ding profits and become unsustainable in the long run. That is a big worry for investors who are already skeptical that chains will not see the traffic bump they are hoping for.” “Investors are not the only ones skeptical about the promotions — so are franchisees, who often push back against discounts because they hurt their profits.” “Coke CEO James Quincey said on Tuesday’s earnings call that the beverage giant has seen weaker away-from-home sales in the U.S. as quick-service restaurants struggle. To boost demand, Coke is partnering with food-service customers to market food and drink combo meals, according to Quincey.” “The promotion is bringing customers back to its restaurants, according to both executives and foot traffic data. June 25, the launch day of McDonald’s $5 meal, drew 8% more visits than the average Tuesday in 2024 so far, according to a report from Placer.ai. The pattern repeated in the following days as the chain exceeded year-to-date daily visit averages. Placer.ai also found that discounts helped drive traffic to Buffalo Wild Wings, Starbucks and Chili’s.” - Amelia Lucas

Lisa W. Miller, CSP Nation's Restaurant News gives her insights on this. "As we enter the summer season, the restaurant industry finds itself in the midst of a familiar battle: discount wars. In less than a week, McDonald’s is unleashing its month-long $5 meal deal promotion, the fast-food giant’s latest attempt to woo customers back and turn up the heat on this summer blockbuster. Will McDonald’s promo be enough to triumph and win back value-conscious guests? After what looked to be three months of progress, economic anxiety across America shot up 5 percentage points, from 31% in April to 36% in May. Meanwhile, the 20% of consumers who say they are “spending as usual” is the lowest level we’ve seen in over a year. This isn’t just a restaurant problem – consumers are pulling back across the board. From our May data among 1,000 consumers 18+ years old, here is the percentage who say they participated in each activity sometime in the past 6 months: • 67% dine-in at restaurants (-9 percentage points vs. Q1 average) • 40% go to the movies (-8 points) • 63% go shopping at a retailer (-8 points) • 17% fly on a plane (-7 points) • 42% get hair done (-6 points) It's no secret that restaurants are hurting. As price increases continue to frustrate consumers, the impact on restaurant visit frequency is increasingly being felt as time goes on. More than half of restaurant customers (52%) say that restaurant prices have gone up too much, while only one third (34%) feel that their most recent restaurant experience was “definitely worth it.” That math just doesn’t work. If you’re familiar with my data, you may have noticed that the 52% of restaurant customers who are frustrated with price is down significantly from Q4 last year. While this may seem like a good thing, when paired with the visitation data, it implies that those who are most frustrated have simply given up. Not good news at all. Delivery isn’t faring better than dine-in; 62% agree/strongly agree that “getting restaurant food delivered is so expensive, it’s just not worth it anymore” and 19% have even made a conscious decision to use delivery less often over just the past 3 months...Click-thru to read more" https://lnkd.in/emdkrdXV #QSR #Entrepreneur #Restaurants #Franchise #Franchising #FranchiseChat Chainformation Altir Industries, Inc. Selling Franchises Boot Camp Titus Center for Franchising at Palm Beach Atlantic University Franchise Pipeline Franchise Development Outsource Ned Lyerly Joe Caruso Michael (Mike) Webster PhD Anders Hall Jonathan Martin Michael Scherr Delaney Hetzer Dr. John P. Hayes, CFE

Consumer spending at restaurants grew 5% in 2023 compared to 4% growth in 2022, according to data shared by Circana in a Monday press release.  Industry sales in 2023 exceeded 2019 sales by 12%, even though traffic is 8% below its pre-pandemic levels. Traffic grew 1% last year compared to 2022. Circana predicts that the restaurant industry will see 1% traffic growth this year. The top 50 restaurant chains have seen their sales grow relative to the overall industry, Circana found. Aggregate consumer spending rose 7% and reached $313 billion, compared to a 2% dollar growth seen at all other restaurants in 2023.

"Restaurant Winners Have a Common Trait: Keeping a Lid on Prices." This headline makes perfect sense: all things being equal, consumers will prefer lower prices, particularly in tough economic environments. It's also easier said than done. Wingstop Restaurants Inc., Texas Roadhouse, Chipotle Mexican Grill and Domino's are four companies that, according to The Wall Street Journal, have each earned "double-digit, year-to-date share price gains relative to a 7% jump in the S&P 500." And all four companies indicated that continuing to deliver value to consumers has been instrumental in outperforming their competitors. But how can restaurants maintain affordable prices as food prices and labour costs continue to rise? Here are three ideas to consider: ➡ Explore Self-Service Options For quick-service restaurants, enabling consumers to order their meals using self-serve kiosks and mobile apps can reduce labour costs and better meet the needs of convenience-oriented customers who'd rather do it themselves. ➡ Ensure Staff Focus on Top Priorities Whether it's a server suggesting the day's specials or a QSR cashier asking if you want to upsize your fries, it's clear that well-trained staff can influence what customers buy... and how much more they spend. Technology platforms that keep staff up-to-date on new product offerings and communicate corporate priorities have a double benefit: they help reduce training time (and associated labour costs) AND help teams focus on selling more profitable items. ➡ Embrace Localization For restaurants where customers order at a counter (as opposed to being served by a team member at a table), digital menu boards make it easier to feature offers that make the most sense for individual locations. For instance, a restaurant on a college campus might benefit by featuring value meals, whereas a restaurant in a wealthier neighbourhood might do better showcasing the chain's newest (and most premium-priced) offerings. Digital menu boards allow restaurants to easily adjust what they feature during any given daypart, enhancing relevance and driving incremental sales. And it's easier for restaurants to maintain lower prices on core menu items when they're confident in their ability to make upsell items more enticing. = = = = = All three recommendations outlined above are examples of technology employed within restaurants to help operators run more efficiently, allowing them to offer acceptable prices to value-seeking consumers while still maintaining profitability. Better technology => better operations => more satisfied customers => better performance ... that's how restaurants can maintain affordable prices as food prices and labour costs continue to rise. #BrickAndMortar #Retail #QSR #Restaurants #Technology