News

NPD: Q3 restaurant industry growth attributed to increased traffic at coffee, burger chains

November 28, 2017

After six consecutive quarters of flat or negative traffic, strong growth at burger and gourmet coffee chains is to thank for a total foodservice industry growth in Q3 of 1 percent, according to a news release from The NPD Group. Collectively, top burger and gourmet coffee chains accounted for a sizeable percentage of total QSR traffic and had a major impact on restaurant traffic overall.

Resturant visits, excluding burger and coffee chains, were flat but still an improvement over the previous quarter when traffic was negative, according to the company, which tracks daily consumer use of foodservice brands. And there's especially good news for marketers whose multiple deals, value items, new products and delivery-focused promotions have prompted visits. Deal-related traffic for the categories were up 7 percent, while non-deal traffic was also up 4 percent.

The group said QSR fast casuals, which make up about 8 percent of the overall category and include Panera and Chipotle, saw an uptick in Q3, with visits up 8 percent compared to the same quarter last year. The research company attributed traffic gains here over the last few quarters to increased unit growth. 

On the flip side of the coin, retail foodservice — like food and drug stores — posted the only traffic decline of any QSR sub-segment for the quarter and full-service brands also posted declines, including the first quarter that fine dining brands faltered. Casual dining and mid-scale restaurants have been in a long-term traffic decline, the company said.

There was also a 2 percent bump in spending at foodservice brands of all ilk, but this was mainly due to rising menu prices, NPD said. In fact, the average restaurant check size has grown every year resulting in an overall 18 percent increase in the cost of a meal out over the last 10 years.
 
"The marketing initiatives and marketing clout of the QSR leaders turned the industry in a positive direction this past quarter," NPD Restaurant Industry Analyst Bonnie Riggs said in the release. "What they promoted found favor with consumers and they should keep it up."