EXCLUSIVE: IN FOCUS: Deal or No Deal... Data Shows How Much Deals Matter to Diners
Data shows just how important deals have become as a driver of restaurant visits since the recession.
As is evidenced in our 'Social Media Wrap Up' each week, QSR and fast casual chains are constantly offering customers enticing offers to dine with them. Now data from The NPD Group shows just why that may be.
According to their research, deals have become an increasingly important factor in driving restaurant visits over the last three years. In 2011, restaurant visits that involved some form of deal or promotion were 26%, whereas by the end of 2014, that figure had increased to 28%.
Perhaps unsurprisingly, 18-34 year olds were the most likely group to seek out deals, with 36% of vists by under 18's involving some kind of deal, compared to just 24% of 35-49 year olds and 21% of those over 50. The increased wealth of older consumers relative to younger ones is one of the reasons for this, though the way in which brands are engaging their customers, with many deals posted on social media sites, also likely to be a key factor for the approach taken by different age groups.
However what is surprising from the data is that pubs are the 'channel' leaders for offering customers deals. The data showed that for 2014, 32% of pub meals involved some form of deal, while for QSRs, that figure was 27%. Furthermore, the dispersion of deals is not uniform, with the relatively more affluent London and South of England benefitting from the greatest choice and prevalence of deals at 30%, with the remainder of the UK at 27%.
There is no doubt that promotions have become an increasingly important way for QSRs to drive business over the past few years, though there is a silver lining for QSRs struggling to compete with discount offers. This is because the most recent quarterly data tells a slightly different picture to that emerging over longer time horizons. Over the last three months of 2014, there was a 2% increase in the number of visits that did not involve a deal.
As the economy continues to grow, the need for deals to attract custom may drop, helping bottom lines, though that is still uncertain. As Jack MacIntyre from The NPD Group says "Despite deals driving growth in the QSR and overall foodservice market over the past three years in particular, the final quarter of 2014 saw a decline in deals. With a deal rate approaching 30% of all visits and younger shoppers using deals in up to 36% of their visits, can traditional promotions continue to grow? Or will Q4 2014 performance continue?".
About The NPD Group, Inc.
The NPD Group provides global information and advisory services to drive better business decisions. By combining unique data assets with unmatched industry expertise, we help our clients track their markets, understand consumers, and drive profitable growth. Sectors covered include automotive, beauty, entertainment, fashion, food / foodservice, home, office supplies, sports, technology, toys, video games, and wireless. For more information, visit www.npd.com and npdgroupblog.com. Follow us on Twitter: @npdgroup.
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