Saturday, February 25, 2023

Restaurant Food Sales Channels of Distribution Evolving


Where are you selling food?  That question and continued discovery around that question has been a key undercurrent driving success of restaurants that are trying to evolve with consumers. According to Steven Johnson Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.

When your customer moves all food retailers need to move with them.  Consumers are dynamic not static and restaurants, convenience stores, delis, and grocery store’s all risk capitulating year over year same store customer counts if they don’t evolve fast enough.

Restaurant gift cards are an avenue of fresh food distribution at reflect just how fast the consumers is evolving.  In a new report from Paytronix titled;  the Paytronix Restaurant Gift Card Report: 2023, which finds that restaurants have moved on from the pandemic, but face changes thanks to inflation. Those changes affect both how restaurants sell cards and how consumers purchase them. Here let’s take a look at some of the key findings in the report:


1.        Today $50 and $100 are the most common cards sold

2.        Restaurant gift card revenue is up 6% year over year; total cards sold is down 2%.

3.        Guests are spending more by purchasing higher value cards.

4.        Average dollars loaded per gift card increased 8% from 2021.

5.        Digital cards outperformed physical cards in terms of value, with the average digital card loaded $82 more at a fine-dining establishment than a comparable physical card.

6.        Third-party retail sales grew, while in-store sales dropped, indicating a channel shift.


In 2022, dollars spent on gift cards rose 6% over 2021, a high-water mark for gift card value, yet the overall number of gift cards sold fell. That meant people loaded on more value, choosing more cards of over $25 and fewer that are under $10. Consumers also showed a preference for digital gift cards, not only by purchasing more, but loading them with higher values than on their physical counterparts.

Paytronix Strategy & Analytics Director Kirstin Lynch, stated, “Gift card purchasing appears to mirror that of loyalty guests. Our research shows that loyalty guests’ checks match inflation. From the beginning of 2020 to the present day, restaurant loyalty guest check size grew in tandem with menu prices.”

While some of this change can also be attributed to customer preference and an overall shift in consumer behavior from quick-service restaurants (QSRs) to full-service restaurants (FSRs), some is driven by restaurant marketers.

Card sales also showed a shift toward FSRs, with that segment showing significant growth, even as QSRs, the segment that best weathered the pandemic, showed a 5% drop in revenue. This trend was particularly apparent for fine-dining restaurants.

“Fine-dining gift card sales have not only recovered completely from the pandemic they’ve also been the only concept to see an increase over 2019 numbers. This indicates a channel shift in consumer preferences – as guests emerge from the pandemic, they prefer to gift experiences at fine-dining establishments,” said Lynch.

Success does leave clues. One clue that time and time again continues to resurface is “the consumer is dynamic not static”.  Regular readers of this blog know that is the common refrain of Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.  Our Grocerant Guru® can help your company edify your brand with relevance.  Call 253-759-7869 for more information. 

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