Consumers Have Bargaining Power
Consumers are using more coupons and other money-saving deals, and restaurant chains are responding.
By Mary Boltz Chapman, Editor-in-Chief -- Chain Leader, 1/1/2009
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Chicago-based restaurant consultancy Technomic Inc. reported that two-thirds of consumers say they are “very concerned” about the economy, and another 27 percent say they are “somewhat concerned.” More than half (53 percent) said they would eat at or from restaurants more often if their personal economic situation were to improve, and 59 percent said they would spend more.
In the meantime, 58 percent of consumers said that money-off coupons would be the most likely way to get them to order more often; 52 percent would be persuaded by a coupon for buying something and getting a second item at a discounted price; 49 percent, combo meals; 48 percent, all-you-can-eat offerings; 42 percent, endless bowls of soup, salad or pasta; and 38 percent, limited-time offers on popular items.
Almost half of the respondents (48 percent) said they use special deals more often than they have in the past.
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According to San Clemente, Calif.-based Sandelman & Associates' quarterly Quick-Track research, which asks consumers about quick-service restaurant use and attitudes, the incidence of using a special deal or promotion is up for third-quarter 2008 over the same period in the prior year (20.8 percent vs. 15.5 percent). The figure has been higher each quarter of 2008: 18.5 percent in second quarter, and 17.6 percent the first quarter.
In the third quarter, 41.1 percent of respondents learned about the deal via direct-mail fliers, a percentage more than double the amount in the same period in 2007 (20.2 percent). Other top sources of awareness include banners or signs at the restaurant (cited by 24.5 percent), television (23.1 percent) and newspapers (18.2 percent).
Wider Retail Space
Port Washington, N.Y.-based NPD Group's Consumer Spending Indicator finds that 57 percent of respondents are cutting back on dining out. The November results on how they use sales and coupons in retailing have not changed significantly since July. In November 29 percent said they would be likely to take advantage of sales; in July, the figure was 28 percent. There was no change in the percentage who said they would be likely to use coupons.
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VALUE ADDED |
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Foodservice Equipment & Supplies, Chain Leader's sister publication, surveys foodservice operators each year as part of its industry forecast. Results show that 46.6 percent of chain operators' traffic is down from 2007 and 24.3 percent are flat. When asked what their operation is doing in response to the challenging economic environment, a greater percentage of chain operators (80.6 percent) said they were adjusting their menu strategy to include “value” items than independent operators (73.7 percent). The methods named were: |
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Response |
Chain | Independent |
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Adjusting menu strategy to include “value” items |
80.6% | 73.7% |
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Adjusting staffing levels |
81.6% | 71.2% |
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Adjusting portions |
42.7% | 43.9% |
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Investing in labor-saving equipment |
17.5% | 15.6% |
| Source: Foodservice Equipment & Supplies 2009 Industry Forecast Operators Survey | ||
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