Table of Contents
Overview
-
- What you need to know
- Definition
Executive Summary
-
- The issues
- Fast casuals beat QSRs on quality, catch up on value
-
- Figure 1: QSR competitive associations, February 2019
- C-store threat exists for QSRs’ most loyal customer
-
- Figure 2: QSR competitive associations, by Generation Z, February 2019
- QSRs face growing labor challenges
- The opportunities
- Natural fast food has wide and growing appeal
-
- Figure 3: QSR concept interest – natural food/beverages, by select demographics, February 2019
- Consumers will pay more for premium meats
-
- Figure 4: QSR price sensitivity, February 2019
- Appeal to young consumers with low-cost special diet options
-
- Figure 5: QSR concept interest, February 2019
- What it means
The Market – What You Need to Know
-
- LSR segment continues to grow, led by fast casual
- Labor challenges keep QSR execs up at night
- Convenience stores are a growing threat to QSRs
Market Size and Forecast
-
- The LSR market will see stable growth over the next few years
-
- Figure 6: Total US revenues and fan chart forecast of limited service restaurants^, at current prices, 2013-23
- Figure 7: Total US sales and forecast of limited service restaurants^, at current prices, 2013-23
Market Perspective
-
- Fast casual growth outpaces QSR
-
- Figure 8: Top 200 Limited Service Restaurants sales, by segment, 2016-2017
- Convenience stores level up their foodservice programs
-
- Figure 9: Slurpee display at 7-Eleven’s new test kitchen in Dallas, Texas, 2019
Market Factors
-
- Labor wars rage on as unemployment rates sit at record lows
- Unemployment rates, increased competition, and a looming recession
-
- Figure 10: Unemployment and underemployment, January 2007-February 2019
- Minimum wage laws
- What does it all mean?
Key Players – What You Need to Know
-
- Blurring segments mean quality improvements at QSRs
- QSRs are pioneers in tech
- Organic is the future of fast food
QSR Sales and Traffic
-
- Chick-fil-A is moving on up
-
- Figure 11: Leading 10 QSRs among Top 200 chains, 2016-2017
- Chick-fil-A becomes fourth-most visited QSR
-
- Figure 12: Fast food restaurant visitation, any visit in past 30 days NET, fall 2013-18
What’s Working?
-
- LSR segments are blurring
- Plant-based menu innovations
- Ordering and delivery technology
-
- Figure 13: Jimmy John’s ad campaign takes aim at third-party delivery, 2019
What’s Struggling?
-
- The LTO as we know it
- Coffee wars rage on
What’s Next?
-
- Organic and natural fast food
-
- Figure 14: Nic’s Organic Fast Food in Chicago, 2019
- Special diet fare
The Consumer – What You Need to Know
-
- Generation Z is a key fast food demographic
- The importance of technology will grow at QSRs
- Natural ingredients are the future of fast food
QSR Visitation & Visitation Drivers
-
- Nearly all consumers visit QSRs
-
- Figure 15: QSR visitation, February 2019
- Healthy options motivate more fast food visits than indulgent options
-
- Figure 16: QSR visitation drivers, February 2019
- Convenient location and healthy options would motivate four in five people to visit a QSR
-
- Figure 17: QSR visitation drivers, by TURF analysis, February 2019
- Women are especially motivated by healthy fast food options
-
- Figure 18: QSR visitation drivers, by gender, February 2019
- QSR tech amenities and social media posts resonate most with Gen Z
-
- Figure 19: QSR visitation drivers, by generation, February 2019
QSR Loyalty
-
- Most consumers are loyal to a particular fast food restaurant
-
- Figure 20: QSR loyalty, February 2019
- Gen Z is the most loyal fast food consumer
-
- Figure 21: QSR loyalty, by generation, February 2019
- Lower income consumers are more loyal to QSRs
-
- Figure 22: QSR loyalty, by income, February 2019
- Convenience and value are the top reasons for loyalty to QSRs
-
- Figure 23: Reasons for QSR loyalty, February 2019
- But four in five are loyal because of convenience and high-quality food
-
- Figure 24: Reasons for QSR loyalty, by TURF analysis, February 2019
- Loyalty programs are most effective with Millennials
-
- Figure 25: Reasons for QSR loyalty, by generation, February 2019
QSR Technology
-
- Twice as many consumers use a restaurant over a third party for delivery
-
- Figure 26: QSR technology experience, February 2019
- Younger consumers are driving the growth of technology at QSRs
-
- Figure 27: QSR technology experience, by age, February 2019
- Hispanic consumers overindex for most types of fast food tech
-
- Figure 28: QSR technology experience, by race and Hispanic origin, February 2019
QSR Menu Price Sensitivity
-
- Premium meat items are more of an expectation than snack items at QSRs
-
- Figure 29: QSR menu item interest, February 2019
- Lower income consumers are most interested in fast food snacks
-
- Figure 30: QSR menu item interest, by household income, February 2019
- Some consumers would pay more for one premium meat item than a full value meal
-
- Figure 31: QSR price sensitivity, February 2019
- Younger consumers have a higher price threshold at QSRs overall
-
- Figure 32: QSR price sensitivity – NET all items, by age, February 2019
- Men are willing to spend more on fast food snacks
-
- Figure 33: QSR snack item price sensitivity, by gender, February 2019
QSR Competitive Associations
-
- Consumers associate quality with fast casuals
-
- Figure 34: QSR competitive associations, by correspondence analysis, February 2019
-
- Figure 35: QSR competitive associations, February 2019
- Gen Zers have better perceptions of QSR quality and service
-
- Figure 36: QSR competitive associations, by Generation Z, February 2019
- Parents are more likely to consider LSRs kid friendly than the general population
-
- Figure 37: QSR competitive associations for kid friendly, by parental status, February 2019
QSR Concept Interest
-
- Natural food and beverages are becoming an expectation at QSRs
-
- Figure 38: QSR concept interest, February 2019
- Natural ingredients and sustainable packaging would appeal to the majority of fast food customers
-
- Figure 39: QSR concept interest, by TURF analysis, February 2019
- Women are driving the demand for natural fast food
-
- Figure 40: QSR concept interest, by gender, February 2019
- Gen Z shows emerging interest in functional ingredients, CBD at QSRs
-
- Figure 41: QSR concept interest, by generation, February 2019
- Nearly half of Hispanic consumers want natural fast food ingredients
-
- Figure 42: QSR concept interest, by race and Hispanic origin, February 2019
Appendix – Data Sources and Abbreviations
-
- Data sources
- Sales data
- Fan chart forecast
- Consumer survey data
- Abbreviations and terms
- Abbreviations
Appendix – The Market
-
-
- Figure 43: Total US revenues and forecast of limited service restaurants^, at inflation-adjusted prices, 2013-23
-
Appendix – The Consumer
-
- Correspondence Analysis
- Methodology
- TURF Analysis
- Methodology
-
- Figure 44: Table – TURF Analysis – QSR concept interest, February 2019
-
- Figure 45: Table – TURF Analysis – Visitation drivers, February 2019
-
- Figure 46: Table – TURF Analysis – Reasons for loyalty, February 2019
Back to top