Restaurants Must Keep Up With Trends

by | Oct 23, 2023 | blog, Business, Industry News, National Restaurant Consultants, Trends | 0 comments

Restaurants Shift Toward Experience

For over year, restaurant consultants and owner-operators have been focused on younger consumers’ drive toward intentional purchasing and experiential dining. The theme of Millennial and Gen Z spending centers around experiences and causes—meaning that these younger spenders are willing to pay more money for eco-friendly, ethically-sourced goods and unique or high-end experiences. They would rather spend more money in one sitting rather than spread across multiple dining out experiences.

With the current economic climate, restaurant owners may be wondering if this trend will shift, influencing younger diners to spend less in lower-cost establishments. However, research by Alix Partners suggests that the original trend will hold—Millennials and Gen Z-ers dining out will still opt for fewer but richer experiences. Further, the focus is less the cost itself, and more the intention or motivation behind the spending. As Alix Partners notes in this Nation’s Restaurant News (NRN) article, The intentional consumer does not necessarily spend less, but is much more deliberate about how and where to spend.” The article further states, “The consulting firm expects this intentional spending toward meaningful dining experiences – over mindless consumption of goods – to continue,” even in times of economic uncertainty. This research suggests that the experiential trend is certainly a generational one rather than an economic one. 

We expect consumers will continue to prioritize experiential purchases, cutting back on retail before restaurants and eating out less rather than simply trading down, as they did in prior recessions,” the article adds.

This means preparation on the part of restaurants, as experiential diners will frequent restaurants less often, though they won’t decrease their spending when they do dine out. NRN has advice for all restaurant categories. “ Broken down by segment, AlixPartners recommends that casual dining brands lean into their service model and in-restaurant experience to further differentiate themselves from fast casual, while also focusing on profitable traffic. Fast casual brands, meanwhile, should position themselves on speed, convenience, and value, while also diversifying their core target customer base beyond millennials. Fast casual concepts also need to position themselves to compete with the speed of the drive-thru channel. Quick-service operators should focus on profitable traffic and value without compromising profit margins.”

This isn’t the first economic shift that has forced restaurants to re-evaluate and prepare, and at National Restaurant Consultants (NRC), our consultants have seen several economic cycles impact consumer habits at restaurants. Restaurants can prepare for the upcoming adjustment by focusing on employee training and morale and adjusting menus for maximum profit.

Richard Weil, owner and principal of NRC, weighs in on these trends. “The food service and hospitality industry has always been flexible to address consumer trends. Change is part of the industry, and the advice provided by the article speaks volumes: Operators make necessary adjustments in their operations to meet generational needs, wants, and desires.”  

To learn more about how to manage these trends, management training and menu engineering with NRC, schedule a free consultation today. Our experts can ensure you’re prepared for whatever this next economic cycle brings. 

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