Restaurants Face an Up Hill Battle for Customers

 

Will it never end, the fight for a larger share of stomach?  The restaurant sector topped out in 2018 with 30.34 restaurants for every legacy grocery store.  A battle for share of stomach that seemed unstoppable as year after year the restaurant sector opened new units and grew by more units than any other retail food sector according to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®  

Once again in a new report that found that inflation and other rising costs have consumers looking to cut expenses, and eating more dinners at home is one way they do it.  The retail food tide seems to pushing back on the restaurant sector. 

According to The NPD Group's latest report, "Future of Dinner," out-of-necessity dinners at home peaked during the pandemic but have since normalized and are still above the pre-pandemic levels. Ultimately, in-home dinners will remain at a heightened level through 2024. 

Darren Seifer, NPD food and beverage industry analyst, stated, "More dinner meals at home are here to stay. The shifting population life stages and economic situation will create greater reliance on dinner at home," … "Consumers across all ages will look for breaks from routine, like making the same dishes out of habit.

"Food manufacturers and retailers can help consumers with dinner prep fatigue with convenient new foods and dishes that fit various cooking skill sets and needs. Value will also be top-of-mind with consumers during this time of high inflation" Seifer added.

Seifer continues, “The research firm also noted that foods that require more effort and time will face headwinds through 2024. For example, seafood, hot and cold sandwiches, and homemade baked goods face headwinds as consumers reset their dinner rituals.”

Yet, there is more, also facing headwinds are foods some may consider convenient, like pasta, an essential go-to during the pandemic.   Although in-home dinners will remain popular, consumers have resumed their busy lifestyles and will look for convenience when preparing dinner, according to NPD.

Our Grocerant Guru® has been documenting this for years as regular readers of this blog know. Here let’s review:

1.       Recent Grocerant ScoreCards found 81.1% of consumers don’t know what’s for dinner at Noon, and 61.1 don’t know what’ s for dinner at 4PM %.

2. Roughly 63.7% of consumers purchase prepared food items from a retail location at least three times a month.
3. 79.6% all dinners have at least 1 grocerant niche Ready-2-Eat and Heat-N-Eat meal component and 66.6% have two meal components.
4. When asked if they wanted to cook dinner from scratch or assemble dinner from fresh meal components 91.3 % of Gen Z chose assemble from Fresh Prepared Meal Components and Millennials 83.4% chose meal components.
5. Seventy-three percent of retail prepared food purchases are taken to go
6. Prepared food purchases are frequently a planned purchase among 61.2% of shoppers, while 40.9% of shoppers said they buy prepared foods on impulse. Dinner has the highest amount of prepared food buys with 81.7% of respondents making purchases for that meal, while lunch comes in at 76.9% and breakfast at 61.4%.
7. 57.8% of consumers would like to add Alcohol to a dinner order

 

NPD found that little or no prep and fast dinner fixes, like frozen meals and ready-to-eat snacks, especially during the work week, will also grow through 2024.

The pandemic escalated the pairing of foodservice and retail prepared foods with in-home prepared dishes to create blended meals. This behavior will continue through the near future, reported NPD, which tracks all aspects of U.S. consumers' eating behaviors daily.

The NPD Group’s "Winning Gen Z Consumers" study found that Gen Z consumers, whose outside recreation like restaurant visits was thwarted by the COVID-19 pandemic, made 218 annual restaurant visits per person in 12 months through February 2022. 

The report also pointed out that price is the most important attribute among consumers 18 to 24 years old when choosing a restaurant. The team at Foodservice Solutions® recommends the NPD Group’s “winning Gen Z Customers”

Don’t over reach. Are you ready for some fresh ideations? Do your food marketing ideations look more like yesterday than tomorrow? Interested in learning how Foodservice Solutions® can edify your retail food brand while creating a platform for consumer convenient meal participation, differentiation and individualization?  Email us at: Steve@FoodserviceSolutions.us or visit us on our social media sites by clicking the following links: Facebook,  LinkedIn, or Twitter