Ongoing Restaurant Inflation Has Even Super Fans Cutting Back
As restaurant prices continue to rise, even the most enthusiastic diners are beginning to pull back on eating out and ordering in, PYMNTS research reveals.
By the Numbers
According to surveys carried out for PYMNTS’ “Connected Dining” series, as of June, only 7.4% of restaurant customers made purchases from restaurants three times a week or more, down significantly from 9.3% the month prior and from 10.2% at the close of last year.
Overall visits were down to 58% from 67.4% in May and 67% last December.
These cutbacks come as restaurant prices continue to rise, even as grocery inflation moderates. Consumer Price Index (CPI) data from the U.S. Bureau of Labor Statistics (BLS) showed that year-over-year restaurant inflation, as of July, was at 7.1%, almost twice the grocery inflation rate of 3.6%, and prices have been creeping up every month this year.
The Data in Context
Amid this pullback, restaurants are challenged to work harder for their customers’ loyalty.
For instance, in June, Denny’s, a full-service diner chain with nearly 1,600 locations around the world, announced the launch of an updated rewards program, leveraging a challenges-based model to motivate behaviors based on data about consumers’ purchasing history.
“Denny’s provides an incredible bang for your buck, and now our rewards challenges take value to a whole new level,” Denny’s President John Dillon said in a statement. “At a time when guests place a premium on value, we are excited about this game-changing summer launch.”
Plus, quick-service restaurant (QSR) giant Yum Brands, parent company of KFC, Taco Bell, Pizza Hut and the Habit Burger Grill, announced in July that it is partnering with analytics platform Treasure Data to boost personalization, a move that is meant to enable the company to be more targeted with its brands’ loyalty programs, among other things.
“This is the latest advancement in our strategy to drive toward enhanced digital experiences and deliver exceptional value to our customers, as the Company remains focused on our vision to have 100% of sales powered by digital,” Yum Brands Chief Data Officer Cameron Davies said. “Treasure Data’s state-of-the-art [Customer Data Platform] … will enhance both our understanding and engagement with Yum!’s customers, ultimately driving more personalized and unique interactions.”
The post Ongoing Restaurant Inflation Has Even Super Fans Cutting Back first appeared on PYMNTS.com.