Restaurants Return: A Slow Road to Recovery
Restaurant operators who have navigated COVID-related shutdowns, restrictions and rapidly changing consumer demands must now prepare for another unexpected reality: Pandemic-related buyer behaviors may be here to stay.
In its most recent quarterly survey, Revenue Management Solutions, a global enterprise providing patented, tech-enabled solutions for the restaurant industry, set out to understand the consumer’s current state of mind. Respondents answered questions about vaccination and how widespread declines in the virus will impact restaurant dining habits. The survey was fielded in late February 2021, with responses from more than 1,100 U.S. diners in rural, suburban and urban markets.
One thing the survey tells restaurateurs: Consumers will return. When asked about eating out at restaurants post-pandemic, an encouraging 32% of respondents said they plan on eating out even more than before the pandemic started, compared to only 13% when polled last fall. Frequent delivery orders are seeing a small decline, with a 6% drop, though takeout and drive-thru continue to climb, each nudging up by 2% over the three-month period.
“We are encouraged to see increased optimism about dining out, high acceptance of the vaccine and a general acceptance of possible price increases,” said Dr. Christina Norton, director of behavioral research at Revenue Management Solutions. “But all signs point to a significantly changed landscape going forward, as buyer behaviors adopted in 2020 appear to have strong staying power.”
Key insights include:
- People continue to work from home. Only 6% of respondents reported that changes in their work environment in the last three months have resulted in now working primarily from the office. The slow transition back to the workspace will likely continue to affect restaurants that heavily relied on commuter or office worker traffic.
- Habits are formed. When asked if their behaviors have remained the same since November 2020, a growing number of respondents said yes. Specifically, 45% of respondents say their breakfast behavior hasn’t changed, compared to 41% in November; 51% report lunch behaviors have stayed the same, up from 44% in November; and 47% report that dinner behavior has stayed the same — an 8-point jump from 39% in November.
- Restaurants are perceived to be safe. When asked if restaurants can provide a safe indoor experience, 51% said yes, an 8% increase from August 2020.
- Willingness to get the vaccine changes dining-out concerns. For those who already received the vaccine or are scheduled to get it, 72% say the number of COVID cases at the local level is the most important factor in deciding to dine out. For those undecided or not planning to get the vaccine, whether or not a restaurant can provide a safe indoor dining experience was the top consideration.
Consumers accept price increases at restaurants more than at grocery outlets. Grocery prices surged last spring due to supply chain issues. Consumers still perceive food-at-home (FAH) prices to be higher than food-away-from-home (FAFM) prices, despite a reduction in the gap between FAH and FAFH pricing and both increasing at similar levels.
Cost increases are justifiable. Most respondents see increased minimum wage, cost of food and safety precautions as justifiable reasons for restaurants to increase prices. At 70%, Boomers were the most understanding; Gen Z was the least tolerant at 41%.
New household concerns rose to the forefront this February, with consumers reporting mental health and not being able to participate in desired activities as key concerns. Both issues moved up three ranks since first reported in May 2020, when the economic impact and inability to see friends and family ranked highest.
“There’s reason to be cautiously optimistic about consumers’ return to in-restaurant dining,” said Norton. “But operators cannot let their guard down on safety and must be prepared to continue to meet the consumer where they are, which is largely still at home.”
Visit RMS’ website to download the full research report for free.
About Revenue Management Solutions
RMS provides data-driven solutions and services to the restaurant industry, all designed to help brands drive sales and profitability while maintaining traffic and enhancing brand value long-term. RMS works with more than 50 major brands in more than 40 countries, with its patented processes of revenue management used in more than 100,000 restaurant locations globally. The company holds five U.S. patents on menu pricing and customer segmentation and supports ongoing academic research efforts. Its industry-leading consumer and trends research has been quoted in numerous publications throughout the pandemic recovery. For more information on how RMS helps its clients, visit www.revenuemanage.com.
Center Reach Communications
Center Reach Communications
View source version on newsdirect.com: https://newsdirect.com/news/restaurants-return-a-slow-road-to-recovery-250876457