Why the frugal consumer signals an opportunity for foodservice suppliers
Barclay’s latest spending report has revealed that British consumers are spending more on eating out, with a 17% increase in spending in restaurants year-on-year in the first quarter of 2015.
But although more people are eating out, they’re spending less in the process. Average transaction values are down by 5.4%, as consumers are favouring cheaper dining options, such as eating in pubs, over more formal eating out.
This shows that value for money has become even more of a priority for consumers. Dining out has become less of a ‘special occasion’ activity, it’s more of an ‘every day’ occurrence, but, because of this, consumers are becoming increasingly selective about where they dine.
Flexibility, diversity and ‘newness’ are they key criteria consumers seek when choosing a restaurant.
For pubs and other traditional drinking outlets, food is now more than just an additional revenue stream, it’s a way to engage with customers and entice them in. Flexible options such as street food and ‘gourmet junk food’ are flourishing because they offer an easy dining option with drinks.
The challenge now for licensees is to adapt their approach to attain competitive advantage, ensuring they are drawing in increasingly value-conscious consumers, while generating extra revenue streams in other areas. For example, we’ve seen an extension of beverage offerings in many eateries. They’re complementing menus with more exotic spirits, craft beers and innovative cocktails. There’s also been a surge in WiFi provisions.
However, the foodservice sector has come under scrutiny recently due to staff shortages, as businesses struggle to keep up with demand. It has been reported that if this skills shortage continues, it could put the brakes on economic growth in this sector.
These issues inevitably signal an opportunity for foodservice suppliers to capture the pub and casual eating out market. It’s a chance for them to highlight the benefits of outsourcing to reduce costs, whilst maintaining quality standards.
Foodservice suppliers offer pubs and budget restaurants a chance to be more cost-effective, whilst delivering quality and value for money to consumers.
But how can businesses in the industry use this as an opportunity to target pubs and restaurants?
PR and marketing professionals within foodservice companies should be reacting to these changing consumer habits and highlighting that their business can deliver the best value for money, whilst still demonstrating innovation and creativity.
Most foodservice suppliers hire highly skilled chefs who have extensive experience but are also on top of the latest culinary trends. This is a really important message that should be considered for any marketing campaign.
Also, they should be using PR and marketing to promote innovation in new product development. They could produce behind-the-scenes style content which will convey their authenticity in terms of how they source their ingredients and how they begin creating new menus. This will break down any potential barriers to using a foodservice supplier.
Lastly, social media has become increasingly useful in the decision-making process for consumers, when they’re searching for somewhere to eat. Easily accessible menus are expected and should be available and promoted via sites such as Facebook, to offer as much guidance as possible. This is a chance for suppliers to work with operators to create useful menus that provide information of the ingredients sourced, including any allergy details, calorie data and insight into how each meal is cooked.
Foodservice suppliers should be highlighting that they are on top of these consumer trends, such as a rise in social media and desire for new and exciting cuisines, and that they can work with operators to maximise the opportunity and boost revenue at a time when diners are spending less.