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The state of eating-out

The state of eating-out. Peter Martin, Peach Factory. Reaction to recession. People aren’t staying at home Search for affordable luxuries Declining trends ‘Experience seeking’ ‘Green / ethical consumerism’ Growing trends ‘Demand for simplicity’ ‘Discretionary thrift’

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The state of eating-out

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  1. The state of eating-out Peter Martin, Peach Factory

  2. Reaction to recession • People aren’t staying at home • Search for affordable luxuries • Declining trends • ‘Experience seeking’ • ‘Green / ethical consumerism’ • Growing trends • ‘Demand for simplicity’ • ‘Discretionary thrift’ • ‘Mercurial consumption’ Source: ‘The post-recession consumer’, P Flatters & M Willmott, Harvard Business Review, July-August 2009

  3. Record year at the movies £1bn sales in UK in 2009

  4. Top pub and restaurant chains ahead too Data from Coffer Peach Business Tracker Six months Easter to Xmas in positive territory

  5. People still eating out Source: HARRIS INTERACTIVE / PEACH FACTORY - EATING OUT FIELD SURVEY: 12th August - 20th August 2009

  6. …compared to 2008 Source: Eating-out and the Consumer 2008, Peach Factory/Harris Interactive (survey February 2008)

  7. U25s driving eating-out (% eating out at least monthly) Source: HARRIS INTERACTIVE / PEACH FACTORY - EATING OUT FIELD SURVEY: 12th August - 20th August 2009

  8. A brand literate nation Increase in recognition across the board in past 18 months

  9. Brand awarenessWhich of the following pub and restaurant brands have you heard of? Over 90% know: McDonald’s; Pizza Hut; Burger King; KFC; Starbucks; Little Chef; Wetherspoons; Wimpy; Subway Over 80% heard of: Beefeater; Pizza Express; Costa; Harvester; Over 70% know: Brewers Fayre; TGI Fridays; Frankie & Benny’s; Pret a Manger; Caffe Nero; Yates’s Over 60% heard of: Slug & Lettuce; Nandos; Café Rouge; Garfunkels Over 50% recognise: Bella Italia; Caffe Uno; Toby Source: HARRIS INTERACTIVE / PEACH FACTORY - EATING OUT FIELD SURVEY: 12th August - 20th August 2009

  10. Biggest visibility winners • La Tasca - up 19% points • Café Rouge - up 16% • Bella Italia - up 16% • Caffe Nero - up 15% • Carluccio’s - up 15% • Wagamama - up 14% • Toby - up 14% • YO! Sushi - up 12% • Pret - up 11% • Nandos - up 11% Source: HARRIS INTERACTIVE / PEACH FACTORY - EATING OUT FIELD SURVEY: 12th August - 20th August 2009

  11. People are using brands % eating at in past six months • McDonald’s 40% • KFC 27% • Wetherspoon 26% • Subway 26% • Pizza Hut 21% • Burger King 20% • Starbucks 18% • Costa 17% • Pizza Express 16% • Harvester 16% Source: HARRIS INTERACTIVE / PEACH FACTORY - EATING OUT FIELD SURVEY: 12th August - 20th August 2009

  12. People are using brands % eating at in past six months • Brewers Fayre 14% • Nando’s 13% • Frankie & Benny’s 13% • Beefeater 10% • Pret 9% • Caffe Nero 9% • Café Rouge 9% • Toby 8% • Wagamama 8% • Little Chef 7% Source: HARRIS INTERACTIVE / PEACH FACTORY - EATING OUT FIELD SURVEY: 12th August - 20th August 2009

  13. Biggest winners Increase in those visiting in past six months • Subway +6% pts • Costa +6% • Pizza Express +6% • KFC +5% • Nandos +5% • Wetherspoon +4% • Café Rouge +4% • McDonalds +3% • Wagamama +3% Value and promotion work Source: HARRIS INTERACTIVE / PEACH FACTORY - EATING OUT FIELD SURVEY: 12th August - 20th August 2009

  14. Brands in growthannouncements only in past few weeks M&B to focus on six core brands Punch rolling out new concepts Nando’s plans for 20plus openings this year, Clapham House plans to triple number of GBKs Tampopo plans to expand at a rate of three or four sites a year Busaba Eathai plans four more sites, Giraffe launches Guerilla Burgers a new burger restaurant Living Ventures launches Red Door Neighbourhood Bar & Kitchen. David Bruce’s Country Food & Dining secures fourth site

  15. But there’s competition Operators have to be smart

  16. How good was the experience?A more mixed picture from a more discerning consumer(% rating experience good or excellent) Over 75% positive rating: Carluccio’s, Nando’s, Prezzo, Wagamama Over 70% positive rating: Pizza Express; Beefeater; Harvester; La Tasca Over 65% positive rating: Café Rouge; Toby; Chef & Brewer; GBK; Table Table; Bella Italia; Pizza Hut; Subway; TGI Fridays; Pret a Manger Source: HARRIS INTERACTIVE / PEACH FACTORY - EATING OUT FIELD SURVEY: 12th August - 20th August 2009

  17. But not all good newsConsumers much more critical - by and large a dip in experience ratings Big risers - giving a better experience Carluccio’s, Nando’s Big losers - giving a worse experience ….some casual dining brands who might be resting on their laurels Innovation, excitement and giving people a reason to go out…winning through Source: HARRIS INTERACTIVE / PEACH FACTORY - EATING OUT FIELD SURVEY: 12th August - 20th August 2009

  18. A few words about pubs…. • Only 25% of adults go to their local for a drink at least twice a month; just 8% weekly • Over 60% drink at home at least twice a month; 38% weekly • 65% say they “like traditional pubs” • But not the centre of social lives • Prefer pubs with good food and wine Source: Eating-out and the Consumer 2008, Peach Factory/Harris Interactive (survey February 2008)

  19. What bosses are going to do about it Market imperatives

  20. Biggest challenges Consumer confidence Economy Employee relations Access to funding Changing customer habits But are generally optimistic

  21. Issues for consumers Quality of experience Service Price Consistency

  22. Becoming more important Customer service Online marketing Staff training Strong brand identity Menu development Customer feedback / research

  23. Technological solutions: Voice recognition to improve drive-thru, carry-out and delivery orders - staying on top of costs

  24. Where need to improve Online activity Consumer research Marketing Property / site acquisition Staff training and development

  25. Where invest Service levels Food quality Marketing and promotions Menu development

  26. Investing in service culture

  27. The new wallet

  28. “It is not the strongest of the species that survives, not the most intelligent, but the one most responsive to change.”Jim Sullivan quoting Darwin

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