Consumers may be ready to shift their food dollar focus away from retail and back toward spending money on dining out at foodservice.
Prior to the COVID-19 global pandemic, there was a large uptick in experiential spending, such as travel, life events and other in person experiences.
Social media platforms played a large role in this. Consumers wanted experiences that generated photos that they could post online. For example, the chicken sandwich wars of 2019 generated a lot of online buzz, especially when customers were able to be the first to purchase a Popeyes sandwich among their friend group.
“We all know what happened in March 2020. These experiential moments were no longer our top priority. Our top priority shifted to staying well, being at home and following a whole new set of rules, so this whole experiential economy came to a grinding halt,” David Portalatin, Industry Advisor for Food and Foodservice at the NPD Group, shared during The Return to Experience.
Will home centricity stick around?
Over the past year, U.S. consumers sourced 86% of their eating occasions at home. At the height of the COVID-19 pandemic, that number reached 88%. Pre-COVID, the percentage of eating occasions at home trended at approximately 83%.
“You might be tempted to say that 83 to 86% doesn’t seem like a big deal, but those percentage points represent about eleven billion eating and drinking occasions,” said Portalatin.
Home centricity could stick around, he added. As of August 2021, 40 million workers are still working from home. In addition, except for lodging, consumer spending on concerts, sports, theme parks, travel, movie theaters and cruise lines remains well beneath 2019 levels.
Foodservice recovery faces several headwinds. Inflation is having a higher impact on food away from home than in retail. In addition, only 63% of consumers indicated that they were comfortable with on premises dining as of August 2021 and unit count and commercial restaurant traffic remain down.
Changing how consumers engage with foodservice
Foodservice locations now need to engage with consumers in a different way, particular in quick service restaurants (QSRs). Previously, QSR was about supplying inexpensive meals on the go, typically for only one person. Now, these occasions are about finding food for the whole family as a home meal replacement, favoring more premium-priced entries.
Full-service restaurants face more limitations than QSRs, given their reduced ability to pivot toward off-premises and delivery.
The trend of experience-based foodservice categories has also started to rebound to pre-pandemic levels.
“At this point, we’re into some robust momentum, especially in amusement, bowling alleys, golf courses and fine dining,” Portalatin explained. “More recently, as we’ve seen some of the restrictions lifted, stadiums and ballparks are doing very well.”
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