Operations
5 dining trends left behind by COVID-19
Matt Drewes, SVP/ group head of Restaurant at Cardlytics, predicts how the dining habits adopted by consumers during COVID-19 will change post-pandemic.
April 5, 2021 by Matt Drewes — SVP, Group Head - Restaurant, Cardlytics
Spring is here, and for the first time in more than a year, we're starting to see glimpses of pre-pandemic life. Schools are reopening, people are traveling and even concerts are striking up as people slowly resume life as usual across the country.
With warmer weather, the return to outdoor dining is heating up as well, which is good news for the restaurant industry. It came as no surprise that during the pandemic, diners adopted new habits at startling rates as delivery, take-out and grocery purchases surged to historic levels. How will these habits change as restaurants fully reopen and what trends will stick around?
Here are my top five restaurant trends to watch post-pandemic.
1. We have a taste for technology
Over the last year, I've added at least 15 restaurant apps to my phone, and I know I'm not alone. If there has ever been a case for restaurants having the right technology, 2020 was it. In fact, purchases via technology (apps or online, including third-party delivery) accounted for 25% of all 2020 restaurant purchases. Considering third-party delivery represented less than 5% of overall restaurant spend pre-pandemic, this points to significant growth. But after peaking in April 2020 at ~15%, third-party delivery recently leveled out at around 12% of all restaurant spend in January 2021. Surprisingly though, brand-specific online and app ordering accounts for another ~14% of delivery and take-out. Expect brand-owned technology channels to continue to grow — especially as it gives restaurants sole ownership of customers' coveted first party data.
2. Third-party delivery is slimming down
While third-party delivery has come down from its 2020 highs, it is still double what it was pre-pandemic. That said, with so many providers, the market is saturated. As demand falls with restaurants opening and taking back their shares, we can expect consolidation in this area.
The big question for third-party delivery providers: "How can you drive customers to order more frequently from you?" The answer: create enticing offers that compel customers to stay with you, rather than chase the free delivery another platform is offering. The 3PD provider who solves this equation will be one of the few left standing.
3. Heading back to the restaurant
Remember the days when you craved a home-cooked meal? Me neither. Restaurants are reopening and diners are eager to return. Customers are rapidly shifting back to dining in restaurants as states begin to allow indoor dining. For example, in 2020, New Mexico, Colorado, and Illinois all reopened in-person dining from August to October and then closed back down in November. During the time that restaurants were open, restaurant spend overtook grocery spend for the first and only time during the pandemic. Expect to see those numbers rise again as more people return to restaurants across the country this Spring.
4. Chicken Sandwich Wars
These days, the chicken sandwich reigns supreme. Nearly every limited-service brand, regardless of genre, has one, and marketers have identified this as a major growth opportunity. One of our partners recently launched a chicken sandwich and stole 3% share from another brand. Three months later, that share fully returned to the original owner. Why? The customers weren't enticed to stay early on. The trick is to engage early, creating loyalty and a lasting relationship via special offers.
5. Ordering going omni-channel
With online, in-person and delivery now table-stakes, restaurant marketers need to take an omni-channel approach to their customers. Cardlytics sees that customers who purchase both online and in-restaurant spend more annually compared to a customer who only purchases online OR in-restaurant. In fact, our data revealed that omni customers spend $122 per customer, while in-store only spend $47 per customer. That translates to a 260% increase in sales with omni, a HUGEopportunity for revenue.
Following a year of uncertainty, what consumers want — quality, convenience and value — hasn't changed, but the way restaurants deliver this experience will continue to evolve. The good news is, there is a renewed industry focus on service and convenience, cooking up a bright future for restaurants and their customers.
-------------------------------
About Matt Drewes
He previously worked in various CPG Brand Management positions at Campbell Soup Company and M&M/Mars including a year developing business in Russia. Matt holds a Bachelor of Science in Finance from Auburn University and an MBA from the Columbia Business School at Columbia University. He’s married with four children and an active volunteer coach at his YMCA.
Related Media
Subscribe
Get the latest news and resources from Fast Casual.
