- Customers continue to count on restaurants for innovation across all channels.
- RMS findings indicate that it’s not value that compels guests, it’s quality.
In a world gone hybrid, it might seem as if all available creativity has been spoken for, used in its entirety during the restaurant industry’s Great Pivot to survive. But not so fast. Your customers want more of what they’ve grown accustomed to: innovation.
When stay-at-home mandates required at-home dining options, the industry was forced to rethink everything. Brands responded creatively with new channels ranging from take-home meal kits to curbside pickup and expanded delivery channels. Now, with much of the world in a mostly post-pandemic state, customer expectations remain high and show no signs of slowing. As Forbes reporter Alicia Kelso mentioned in a recent Revenue Stream episode, “Consumers are getting what they want, where they want and when they want it.”
But there’s room for improvement. In its most recent consumer survey, RMS found that only 46% of respondents believe that quick-service restaurants (QSRs) are very innovative, and well over half feel that all QSRs are more or less the same as each other.
So now what? How can an operator stand out and be seen as innovative? RMS has lined up a few opportunities for innovation that merit a closer look. Keep in mind that innovation isn’t limited to new menu items (although that’s undoubtedly an opportunity). It also involves perception — for both operators and guests.
Rethink the value equation
Post-COVID, the definition of value has changed for most restaurants — and most customers, too. Today, value includes an entirely new level of convenience and service across all channels, whether at the drive-thru window or dining in.
As inflation continues to hit consumers (and industry) hard, guests are throttling back on food away from home. When they do tap their discretionary incomes for a meal out, they expect it to deliver. They want an experience that makes them feel valued, which these days requires innovation beyond an expanded value menu.
If hitching an ever-evolving value equation to innovation sounds impossible, it’s not. Take, for example, TGI Fridays. They’re tackling the value equation from an unexpected angle: moment by moment and hire by hire. The brand knows that a good team and getting the moment just right — whether that’s a special occasion or everyday occurrence — are critical in a recessionary economy. To achieve those goals, the fast casual is doubling down on attracting and maintaining top talent. They’re taking innovative measures such as paying employees daily and offering sizable vacation reimbursements.
Quality over value
Again, it comes back to the value equation — the overall experience — when determining a brand’s path to innovation. Even in inflationary times, although guests still put a premium on quality over value, operators will need to be thoughtful when taking price. When asked about their QSR behaviors, 49% said that they compare prices before making their final choice. The most effective approach includes blending costs to offset price increases in one menu area with decreases in another. Menu descriptions (across all channels) should indicate quality and premium ingredients and, if appropriate, indicate that a source is local or regional.
Finally, don’t overlook rethinking how you view items. Experiment with modifying portion size and providing options to customize that let the guest be innovative. It’s possible to make a familiar item new by changing its size and presentation. Doing so is also a low-risk, low-cost and potentially lucrative way to grow check.
Embrace the wonky supply chain
Now is the opportunity to reimagine the menu: Limited-time offers (LTOs) allow you to be flexible and create multiple items with what you have on hand.
Exclusive menu items can invigorate your guests, as well. Updating your menu every now and then gives guests a reason to try something they wouldn’t necessarily experience at home. (And if they can make it at home, 54% say they can’t justify spending money on restaurants.) Given that almost half (54%) of respondents feel that menu items at QSRs need to be improved and 59% are “always interested in new menu offerings.” For operators, this means that the endeavor is worthwhile.
Besides enticing guests, featuring LTOs allows operators to plan ahead, control costs and lock in inventory and prices with vendors. While there still may be surprises, embracing what the supply chain offers is certainly an opportunity for innovation.
To keep guests coming in the door, Sarah Lockyer, Chief Brand Officer of The Elliot Group, advised, “It’s not just one value equation per brand. It’s the value equation of off-premise; the value equation of dining in; and the value of price and our collective ability to throw a great party to help people celebrate the things that are important to them.”
If you are interested in innovative ways to keep guests coming in your doors, RMS can help strengthen your restaurant’s pricing, menu and brand strategy. Get in touch with our experts, and be sure to subscribe to our mailing list to get industry trends and reports delivered straight to your inbox.