The 2023 National Restaurant Association Show took place on May 20-23 in Chicago’s McCormick Place, with a focus on the challenges and opportunities facing the restaurant industry. The Numerator team was thrilled to attend and celebrate our launch of a comprehensive new restaurant data set— now including the top 27 limited service restaurant (LSR) chains across Burger, Chicken, Pizza, Sandwich, Coffee, etc., as well as the major third-party delivery providers like DoorDash and UberEats, and platform for limited service restaurants.
Trends and Insights from Numerator
While walking the floor during the 2023 National Restaurant Association Show, the Numerator team identified three key themes and tied them back to the challenges and opportunities facing the restaurant industry: planning for the long-term with Gen Z, delivering a positive delivery experience, and innovating in the plant-based space.
Gen Z
As explored in Numerator’s Zooming in on Gen Z Buyers report, when Gen Z’ers first start buying independently, restaurants top the list. Discretionary dining is the most common category (59%) 18–20-year-olds purchase on their own, and given that only one-in-five pay for their own housing, utilities, tuition or medications, these consumers have more budget for discretionary items. Overall, Gen Z diners favor Starbucks, Chipotle and Jack In The Box, visiting these restaurants more frequently than other generations. Younger Gen Z’ers frequent Panera and Little Caesars more often than most, while older Gen Z’ers prefer Chipotle.
Delivery
Third-party delivery is a fraught topic among many restaurants. While 3PD is certainly here to stay— more households (37% more households use 3PD since 2019) are spending more (up 83% in spend) on delivery— customers continue to be frustrated with food quality issues. Long waits, freshness, and temperature are core concerns for 3PD users, and poor delivery experiences can weaken restaurants’ brand equity. Nonetheless, our Delivery Deep Dive webinar revealed that 3PD does engage valuable, young, and high-income households and is more likely to attract net-new fans. Only 1 in 10 delivery users claim that they’re unlikely to order from a restaurant via 3PD again, including users who had a poor experience, suggesting that restaurants should continue to view the channel as a vehicle for growth while addressing food quality, order accuracy, timeliness, and the overall value prop.
Plant-Based Innovation
Since the launch of Burger King’s Impossible Whopper in 2019, leading Restaurants have explored plant-based categories as a strategy to bring in new customers or drive more trips. As discussed in our spring ’23 webinar, Planting a New Strategy: How to Engage the ‘Flexitarian’ Shopper, plant-based-categories saw significant sales growth in 2019 & 2020, but since then, the majority of the sales, household, and trip growth has slowed down. However, Restaurants can still drive plant-based growth by engaging ‘flexitarian’ households, who buy both plant and animal-based categories. These households are responsible for 99% of repeat plant-based purchases and 54% of animal-based purchases. For example, nearly half (48.8%) of consumers who tried Chick-fil-A’s new Cauliflower Sandwich said that the taste was much better than expected, and 89.5% overall thought the sandwich at least met their expectations. 66.3% of triers are extremely or very likely to purchase it again.
The National Restaurant Association Show enabled valuable discussions about the opportunities and challenges facing the Restaurant industry and its customers— which the Numerator team is looking forward to exploring in our research this year. Interested in learning how these key trends or others discussed at the show are impacting your business? Reach out to us today to learn more.
