Thursday, February 19, 2015

Fast Food Lacking Customers Fat Chance




Hoopla, hullaballoo, and industry hysteria aside the fast casual sector hasn’t taken over the restaurant sector.  If you have read any industry trade magazines in the past three years you would think that consumers only visited fast casual restaurants.  Simply put that is non-sense, non-objective, self-serving rhetoric.  

While industry trade magazines need to sell advertising, conferences, and subscriptions one thing is painfully clear; consumers did not read them, did not follow the hoopla, hullaballoo, or magazine hysteria.  

One legacy industry leading researcher at The NPD Group stands out. That icon of industry research is Bonnie Riggs who artfully places the importance of facts over folly. 

Here is how Ms. Riggs research facts place value on fast food over other sectors;   “Americans made 61 billion visits to restaurants last year. Three out of four visits were too fast food restaurants, like McDonald’s.”
Yes, there are new restaurants.  Yes, many of those deemed fast casual are growing faster than other sectors specifically Casual dining sector, and the Full-service restaurant sector.  The battle underway is not fast food vs fast casual but a battle for consumer’s share of stomach. 

The restaurant sector over the past several years has not been winning that battle for share of stomach.  Non-traditional fresh prepared food retail sectors including Drug stores, Convenience stores, Grocery Deli’s all have focused on Ready-2-Eat and Heat-N-Eat fresh prepared food are garnering trial, and customer migration, and increases loyalty garnering an edge according to our own Grocerant Guru™. It must be noted that most of the trial success is closer to fast food / QSR offerings than other sectors of food retail.  

Last year Foodservice Solutions® found that McDonald’s was the leading aspirational brand in the U.S.  In the same year the Census Bureau’s found approximately 20 percent of children, or 16 million youths under the age of 18, are on food stamps. That number had double since 2007.  McDonald’s continues to be an aspirational brand for many, and a great restaurant operation for many more. 

Deborah Wahl, McDonald’s Chief Marketing Officer stated “McDonald’s is in a unique position to bring a little more lovin’ to our customers”.  McDonald’s gets it and should not be discounted as a competitor by anyone. 
With 61 billion visits to restaurants last years and three out of four were too fast food we think the fast food / QSR sector could use a little trade magazine support, lovin as well. One thing is clear consumers are still lovin the fast food sector.

When you add in the new food offering from C-stores, Drug Stores and Grocery Deli’s one thing is clear the ‘fast food /QSR’ movement has strong customer support and momentum. Regular readers know 1751 unit Casey’s General stores fresh food sales are up 22.8% over the past 24 months alone, and Wawa is investing $550 Million in new stores in Florida alone.  

Success does leave clues, companies the ilk of Popeyes, Wendy’s, Burger King, Jack In The Box, Casey’s, Walgreens, Wawa, Whole Foods and 7-Eleven all are exhibiting signs of life, positive sales growth.
Since 1991 www.FoodserviceSolutions.us  a Tacoma, WA based retail foodservice consultancy has been the global leader in the Grocerant niche. Is your company ready for a grocerant niche scorecard? Could outside eyes help you drive inside profits? 253-759-7869 Email: Steve@FoodserviceSolutions.us

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