Technomic Study Provides a Snapshot of Quick-Service Restaurant Customers

What does the typical frequent quick-service restaurant (QSR) consumer look like? Recent research finds that he is Caucasian, between 25 and 34 years old, accompanied by his spouse or significant other, and likely dining in the restaurant.

So finds a demographic analysis of almost 38,000 consumers polled for Technomic Inc.'s ongoing Consumer Restaurant Brand Metrics research and analyzed for the recently released Understanding Quick-Service Restaurants and Their Customers Market Intelligence Report. 

"The quick-service restaurant segment includes some of the largest and most innovative companies in the U.S., as well as some interesting up-and-comers," says Technomic Executive Vice President Darren Tristano. "But at the same time, increasing competition means that it's more important than ever to understand what consumers value about fast food and where QSRs have opportunities to improve."

Technomic's Consumer Restaurant Brand Metrics program provides chains with a unique scorecard to benchmark performance against their peers and track results over time. The study asks consumers to rate the importance of certain attributes when deciding which QSR to visit. Based on initial survey analysis, Technomic ranked the top attribute categories.

Attribute Importance Ranking
(percentage of consumers giving a top two box rating, based on a 1-5 scale where 1 = not important and 5 = very important)

1. Food -- 91%
2. Cleanliness -- 88%
3. Service -- 86%
4. Value -- 84%
5. Beverage -- 78%
6. Atmosphere -- 61%

Leading Chains in Each Attribute
(top five, in alphabetical order)

1. Food -- Chick-fil-A, Culver's, Golden Corral, Jamba Juice, Papa Murphy's
2. Cleanliness -- Chick-fil-A, Cold Stone Creamery, Culver's, In-N-Out Burger, Papa Murphy's
3. Service -- Chick-fil-A, Culver's, In-N-Out Burger, Krispy Kreme, Papa Murphy's
4. Value -- Chick-fil-A, CiCi's Pizza, In-N-Out Burger, Krispy Kreme, Papa Murphy's
5. Beverage -- Caribou Coffee, Chick-fil-A, Jamba Juice, Old Country Buffet/HomeTown Buffet, Starbucks
6. Atmosphere -- Caribou Coffee, Chick-fil-A, Cold Stone Creamery, Culver's, Starbucks

The first in a new series of related segment-specific reports, Understanding Quick-Service Restaurants and Their Customers examines the demographic composition, behavior and attitudes of quick-service restaurant consumers. The report is powered by Technomic's Consumer Restaurant Brand Metrics program, an ongoing comprehensive study that demonstrates how consumers rate the importance of roughly 50 restaurant attributes regarding food, service, atmosphere, value, convenience, reputation and more, as well as the performance of 52 leading quick-service chains on these attributes.

Findings include:

• 82 percent of QSR consumers rate the food quality at their recent visits as good or very good.
• QSR patronage tends to peak with the 25-34 age group, then decrease with each age cohort.
• Consumers form opinions about products and services whether they have had first-hand experience or not. 66 percent of consumers feel that the average QSR is good or very good at emotional connection; and 58 percent say the same of brand image.
• Consumers give QSRs an average rating of 56 percent for advertising effectiveness, but those numbers range from a high of 69 percent who believe the top chain is good or very good to a low of just 33 percent.
• Eight out of 10 consumers say they are willing to recommend the quick-service restaurant they rated to friends and family.

Source: Technomic Inc., 10/01/12) 

A&W Burger Franchisee Launches Mobile Marketing Initiative

3Seventy, a provider of mobile engagement solutions, has announced the launch of a new SMS marketing campaign for Harman Management, the owner of A&W Burger franchises with almost 200 locations on the West Coast.

For the initial campaign, 3Seventy teamed up with AFA Krause Advertising and Harman Management.

The franchisees wanted to drive more traffic to specific locations with mobile and developed an offer for one free Papa Burger for customers who texted the keyword BURGER to short code 70626. The response exceeded initial expectation, with more than 36,700 opt-ins during the first month.

"We know SMS coupons are a highly effective way to drive customer response, but are overwhelmed by the success of this mobile campaign," said Amber Hampshire, account supervisor at AFA Krause Advertising.

"This is an excellent example of the immediate results you can see from text marketing and this is a great case study in the quick service restaurant industry," said Carrie Chitsey, CEO and founder of 3Seventy.

(Source: QSRweb.com, 06/29/12) 

Customization, Healthful Foods Top 2012 Restaurant Trends

Healthful menu items, local foods and customization will be key sales drivers for restaurant operators in 2012, according to a forecast released last week by Chicago-based market research firm Mintel.

Mintel made predictions on menu and operations trends:

• Since consumers are more interested in where food comes from, restaurants will focus on American regionalism. Among geographic claims on restaurant menus, however, "New York-style" showed up the most last year, followed by "Texas." For the first time, "Philly-style" surpassed "New England" in menu mentions.
• Menu labeling will lead more operators to offer "double-sided menus," offering something for everyone in terms of both nutrition and price. Customization will continue to drive consumer satisfaction, as guests are offered more opportunity to control their selections. The barbell approach to pricing will morph into a more consumer-focused tiered pricing approach, Mintel said.
• With an emphasis on fresh, unprocessed food, restaurants will offer and promote more "handmade-just-for-you" items.
• As restaurant chains grow globally, they will also develop more expertise in international flavors and methods, allowing for the import of ideas. McDonald's Chicken McBites came from Australia, for example, and both McDonald's and KFC are using self-serve kiosks in Europe. KFC is also offering espresso and Lavazza brand coffee in the United Kingdom.
• Steak and Caesar salad remain the top menu offerings, and they are still growing in popularity. Among burgers, cheeseburgers are climbing; sushi is losing ground to salmon; and quick-service operators are enhancing their breakfast sandwich lineups.
• What do customers want? About half of respondents said they'd like to see lower prices, and 29 percent want smaller portions, followed closely by the 28 percent who want more healthful menu options. The descriptors "fresh" and "made from scratch" were also of interest to the majority of restaurant goers, but the term "artisan" does not resonate. Only 28 percent said they were interested in the latter.

QSRs to lead industry sales growth

Sales growth in the foodservice industry will increase 2.8 percent this year to $416.4 billion, with limited-service restaurants leading the charge, Mintel said.

Adjusting for inflation, the increase will be nearer to 1.5 percent.

This year, limited-service restaurants are expected to see sales rise 4.1 percent to $219.1 billion, or a 2.8 percent inflation-adjusted increase.

Full-service restaurant sales are expected to increase 1.5 percent -- or an inflation-adjusted 0.2 percent -- bringing that segment to $197.2 billion, Mintel said.

In 2011, the overall foodservice industry grew 1.4 percent to $404.9 billion, or a decline of 0.2 percent when adjusting for inflation.

Limited-service segment sales rose 3.4 percent last year, or 1.8 percent with inflation. Full-service restaurants saw sales decline last year 0.7 percent, or a decline of 2.2 percent with inflation.

Although the economy remains challenging, the report noted improving unemployment trends, as well as increased disposable personal income levels and a more optimistic consumer sentiment.

And although menu-labeling laws are expected to come into play for restaurants in 2012, many chains have already developed more healthful options that aim to appeal to increasingly health conscious consumers, the report found.

Mintel surveys indicate that 41 percent of restaurant goers said menu labeling would not impact how they dine out, while 33 percent said they will order menu items that are more healthful overall and have fewer calories.

Looking at January, a survey by Mintel found that 65 percent of respondents who visited a restaurant that month said they plan to spend the same amount at restaurants in 2012 as they did last year.

About 12 percent said they plan to spend more, while 23 percent said they plan to spend less.

Still, 63 percent of respondents said it's too expensive for them to dine out regularly.

Of the 12 percent who said they will spend more, 59 percent said they would spend more at casual dining restaurants, followed closely, at 57 percent, by family dining.

(Source: Nation's Restaurant News, 03/13/12)

Arby's Revamps Kids' Meals

Healthier Kids' Options and Charity Work Highlight Chain's New Kid Strategy

Arby's announced in an exclusive interview with QSR that it is unveiling a new, healthier kids' meal strategy and leveraging it to raise money to fight childhood hunger.

Today, the Atlanta-based company will debut two new kids' meal entrees and replace fries with apple slices and strawberry yogurt dipping sauce as a side to every option on its Kids Meal menu.

The Arby's Foundation will then use the rollout to support the company's new partnership with Share Our Strength's "No Kid Hungry" campaign, which seeks to end childhood hunger in the U.S. by 2015. Arby's aims to raise $1 million for the "No Kid Hungry" campaign by the end of the year.

Hala Moddelmog, president of Arby's Restaurant Group Inc. and chair of the Arby's Foundation, says the two campaigns work in concert with each other to benefit healthy eating in the U.S.

"We loved the synergy of having a good kids' meal that the moms would like and the kids would like, and letting the moms and the rest of our consumers be able to contribute to 'No Kid Hungry' and this hunger movement through this," Moddelmog says to QSR.

The two new entrees joining the Kids Meal menu at Arby's include a Jr. Turkey and Cheese Sandwich and Kraft Macaroni & Cheese.

Kids can also choose among low-fat white milk, Capri Sun 100% Fruit Juice, or bottled water for their beverage.

The new Kids Meal offerings reduce calories by 40 percent, fat by 70 percent, and sodium by 50 percent compared with its previous offerings.

Moddelmog says that when Arby's went through its last round of customer research, it focused mostly on its mom clientele.

"The moms told us that they wanted some healthier choices available, and the apples and the yogurt sauce were definitely popular items, so that was a no-brainer to get that in there," she says.

Arby's announcement of a healthier kids' menu follows in the footsteps of other quick serves that have moved to make their kids' offerings healthier.

In July, the National Restaurant Association launched its "Kids LiveWell" program with 19 partner brands, establishing a set of nutritional criteria that brands could voluntarily follow.

Days later, McDonald's announced that beginning this year, every Happy Meal would include apple slices as the default side item and that the portion size of a kids' fries would shrink.

Moddelmog says Arby's has "had a bit of an advantage" when it comes to consumers' desire for healthier dining options.

"Our customers have been telling us for a long time that they feel a little better about eating Arby's, they feel a little lighter, they feel a little healthier, a little more balanced with an Arby's purchase," she says. "What we really wanted to do is...make sure that we call that out for our moms and kids."

Julie Casey is a mom blogger and founder of MyKidsPlate.com, a website that points families toward healthier restaurant options. She says chains' addition of healthier choices to kids' menus is a good move. But she still has her reservations.

"Why does everybody keep doing apples?" Casey says. "Can someone please get more creative and do orange slices or grapes? Let's start offering some different stuff."

Variety, Casey says, is what many moms tell her they want for their kids at restaurants.

"When you offer one entree or one side item that's a healthy option, do you want people to just order that one thing over and over again?" she says. "Variety is huge, especially now.

"Kids want more options, moms want more options. That's the name of the game these days, especially as kids are more willing to try new things than they ever have before."

That variety may have to wait, though. Moddelmog says the sheer size of Arby's system mandated an efficient roll out of its new items.

"We know with 3,600 restaurants, rolling out anything new is a feat, but part of what we tried to do with the kids' meal is really keep it simple for our operators," she says. "So the apple slices and yogurt come prepackaged and ready to go, and the Macaroni & Cheese is in a format that is easy to deliver."

Arby's will then donate a portion of every Kids Meal purchase to the "No Kid Hungry" campaign. Moddelmog says there will also be literature in stores that highlights the campaign's mission, so customers can educate themselves and their families on the issue.

"Picture this: There are a lot children in America who are on the free lunch program, and that is great during the school year, but during the summer, where do these kids get their food?" she says.

"One of the things we want to help do with 'No Kid Hungry' is activate feeding sites in the summer that are accessible for the children so that they can get food then."

Moddelmog says the new efforts by Arby's are a,"first line of defense so that (kids) can have calories and have their energy to learn, because at the end of the day, we must have a society that can learn and help us all grow."

"We feel like this is a pretty broad mission," Moddelmog says.

(Source: QSRMagazine.com, 09/30/11)