EXCLUSIVE: Data Shows Meal Deals Growing in Popularity
Data from the NPD Group has revealed that the use and availability of meal deals in Quick Service Restaurants (QSR) is in long-term growth, growing by 22% between YE December 2010 and YE December 2015. This equates to 185 million more QSR visits in which a meal deal is used.
A meal deal is now used in 18% of all visits to the QSR channel, up from 15% in 2010. This is 3% points higher than the out-of-home average, but 5% points lower than the Casual Dining channel.
The appeal of a meal deal offering to operators within QSR is clear; consumers spend 6% more (£3.87 vs. £3.65) when using a meal deal in the channel. This is driven, perhaps unsurprisingly, by a larger number of items being purchased in these visits (2.9 items vs. 2.0 items). In an increasingly competitive market awash with choice, where visits are at a premium, it makes sense to ‘lock-in’ consumer spend by using meal deals. While there are also implications for margins attached to the items included, meal deals have been widely used to boost average spend to make up for an overall loss in visits in the out-of-home market (there are 500 million fewer visits to the overall market now than in 2009). Although QSR has been a channel which has resisted the overall trend of declining visits, the trend has clearly permeated here from other channels, with a combination of operator ‘push’ and consumer ‘pull.’
For consumers, meal deals add to the trend towards ‘super-convenience’ in the market. Being able to simply pick up all elements of their meal, with an attached discount, is appealing to busy consumers, as well as those seeking a good deal.
In the latest year, though, we have seen a return to growth for non-promoted visits.
As Jack MacIntyre, Senior Account Manager at NPD Group commented: “As confidence returns to consumers’ mindsets, so does their propensity to seek out experiences, quality, and new tastes. We have seen this manifested in the recent street food ‘boom’ and in the increasing incidence of niche cuisines, even in the more mainstream QSR operators. While this all means that consumers are more focused on these criteria, price does still play a part in their decision-making, but as part of a wider ‘value proposition’, balancing out the pros with price considerations. As consumers become more confident, and operators’ offerings more innovative and quality-conscious, we expect to see non-promoted visits continuing to grow in the channel.”
