Table of Contents
Executive Summary
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- Market overview
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- Figure 1: Total US revenues and forecasted sales ranges of restaurants and eating places*, at current prices, 2014-24
- Impact of COVID-19 on foodservice loyalty
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- Figure 2: Short, medium and long term impact of COVID-19 on Foodservice Loyalty, June 2020
- Top takeaways
- The issues
- Restaurant purchases are becoming a lower priority
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- Figure 3: COVID-19 spending priorities, April-May 2020
- Women are even more likely to cut dining out in a recession
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- Figure 4: Spending cuts after job loss – NET any rank, by gender, November 2019
- Figure 5: Restaurant loyalty by segment, by gender, April 2020
- Work from home negatively impacts breakfast, lunch and beverage loyalty
- Loyalty will shift more to independents over chains in wake of COVID-19
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- Figure 6: Restaurant loyalty statement agreement, April 2020
- The opportunities
- Loyal restaurant customers are more likely than their counterparts to buy restaurant food during this pandemic
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- Figure 7: Restaurant takeout behavior, by restaurant loyalty status, April 2020
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- Figure 8: Restaurant delivery behavior, by restaurant loyalty status, April 2020
- Restaurant subscription programs can drive repeat purchases when brands need them most
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- Figure 9: Restaurant loyalty statement agreement, by generation, April 2020
- Digital community is key to engaging loyal restaurant customers
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- Figure 10: Restaurant marketing statement agreement, by restaurant loyalty status, April 2020
The Impact of COVID-19 on Foodservice Loyalty
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- Figure 11: Short, medium and long term impact of COVID-19 on Foodservice Loyalty, June 2020
- Opportunities and threats
- Most don’t feel more loyal to chains, highlighting a need to connect with diners on a local level
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- Figure 12: Restaurant loyalty statement agreement, April 2020
- Daytime restaurant business will be impacted in a big way
- Mobile-based self-checkout and loyalty programs keep c-stores competitive with restaurants
- Reward loyalty with novel perks
- Subscription convenience + value = loyalty builder
- Impact on foodservice loyalty
- 2020 foodservice sales nosedive because of COVID-19
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- Figure 13: Total US revenues and forecasted sales ranges of restaurants and eating places*, at current prices, 2014-24
- Consumers deprioritize restaurant visits during COVID-19 outbreak and recession
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- Figure 14: Future activities, April-June 2020
- How the crisis will affect loyal restaurant consumers
- Loyal consumers are crucial to restaurants’ survival during the pandemic
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- Figure 15: Restaurant takeout behavior, by restaurant loyalty status, April 2020
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- Figure 16: Restaurant delivery behavior, by restaurant loyalty status, April 2020
- Men, dads, young, Black and Hispanic consumers are most frequent loyal customers
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- Figure 17: Loyal restaurant visitation frequency, by demographics, April 2020
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- Figure 18: Annual unemployment rate, by race and Hispanic origin, 2005-19
- How a COVID-19 recession will affect restaurant loyalty
- Dining out sales and restaurant loyalty will diminish during the US recession
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- Figure 19: unemployment rates, December 2007-May 2020
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- Figure 20: Consumer spending on food away from home, monthly, 2006-10
- Figure 21: Consumer spending on food away from home, annual, 2000-19 and Q1 2020
- COVID-19: US context
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The Market – What You Need to Know
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- Restaurant sales plunge as a result of COVID-19
- Recessionary spending will further hurt dining out
- Restaurant loyalty will help save some sales
Market Landscape
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- COVID-19 causes massive gouge in restaurant sales
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- Figure 22: Total US revenues and forecasted sales ranges of restaurants and eating places*, at current prices, 2014-24
- Figure 23: Total US revenues and forecast sales ranges of restaurants and eating places*, by segment, at current prices, 2014-24
- FSR market share is threatened
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- Figure 24: Percentage share of Top 200 restaurant chain sales, by segment, 2018*
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- Figure 25: Top 200 restaurant chain sales and percentage sales growth, by segment, 2016-18*
- Loyalty will shift more to independents as US restaurant market shrinks
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- Figure 26: Restaurant loyalty statement agreement, April 2020
Market Perspective
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- C-store loyalty programs grow, offer seamless checkout options
- Competing restaurant loyalty programs emerge
Market Factors
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- State reopening plans limit dine-in capabilities
- Dining out will take a big hit as US enters a recession
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- Figure 27: unemployment rates, 2008-May 2020
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- Figure 28: Spending cuts after job loss – NET any rank, November 2019
- Figure 29: Spending cuts after job loss – NET any rank, by gender, November 2019
- Restaurant purchases are less of a priority during COVID-19 outbreak
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- Figure 30: Future activities, April-June 2020
- Loyal consumers are heavier restaurant purchasers in this pandemic
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- Figure 31: Restaurant takeout behavior, by restaurant loyalty status, April 2020
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- Figure 32: Restaurant delivery behavior, by restaurant loyalty status, April 2020
- Work from home will hurt breakfast, coffee/tea and lunch business
- Black consumers are less likely to use smartphones, creating a barrier for loyalty program adoption
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- Figure 33: Smartphone users, by race and Hispanic origin, Fall 2019
Key Trends – What You Need to Know
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- Winning loyalty programs cater to individuality with personalization
- Loyalty programs that don’t accept cash payment will suffer
- Subscription programs will continue to emerge
Key Players – Restaurant Loyalty Programs
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- Trend Drivers – Which loyalty programs are the best and why?
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- Figure 34: Mintel’s Global Trend Drivers and Pillars
- Starbucks’ loyalty program caters to consumers’ needs for technology, identity and value
- Chipotle’s loyalty program wins with technology, experiences, identity and value
- Dunkin’s loyalty program offers value, identity and rights
What’s Working?
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- New loyalty programs continue to crop up
- Personalized loyalty takes precedent
What’s Struggling?
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- Cashless-only loyalty programs
- Loyalty will need to help reinvigorate breakfast and lunch dayparts
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- Figure 35: Restaurant purchasing in past three months, by restaurant loyalty status, April 2020
What’s Next?
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- Subscription programs will take off
- Restaurants will reward loyal customers when dine-in reopens
- Meal kits will appeal to loyal restaurant consumers
The Consumer – What You Need to Know
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- Men, dads, young, Black and Hispanic consumers are important restaurant customers
- Service is central to loyalty
- Mobile apps are the future of loyalty programs, but they must always make way for cash
Restaurant Loyalty Status and Visitation Frequency
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- Most consumers feel loyalty to a restaurant
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- Figure 36: Restaurant loyalty status, April 2020
- Loyal consumers tend to be young, city- and town-dwellers and dads
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- Figure 37: Restaurant loyalty status, by demographics, April 2020
- Loyal consumers also tend to be lower- and middle-income and digitally engaged with restaurants
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- Figure 38: Restaurant loyalty status, by CHAID – Tree output analysis, April 2020
- Nearly half of loyal restaurant consumers visit restaurants at least once a week
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- Figure 39: Loyal restaurant visitation frequency, April 2020
- Men, dads, young, Black and Hispanic consumers are most frequent loyal customers
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- Figure 40: Loyal restaurant visitation frequency, by demographics, April 2020
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- Figure 41: Loyal restaurant visitation frequency, by CHAID – Tree output analysis, April 2020
Restaurant Loyalty Motivators
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- Friendly service is key to restaurant loyalty – Above convenience, speed and price
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- Figure 42: Restaurant loyalty motivators, April 2020
- However, speed is growing in importance among loyal consumers
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- Figure 43: Restaurant loyalty motivators, by generation, April 2020
- Speed and price are more important to lower-income loyal consumers
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- Figure 44: Restaurant loyalty motivators, by income, April 2020
- White consumers are most likely to be restaurant loyal because of high-quality menu items
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- Figure 45: Restaurant loyalty motivators, by race and ethnic origin, April 2020
Restaurant Loyalty by Segment
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- Consumers are most loyal to fast food restaurants
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- Figure 46: Restaurant loyalty by segment, April 2020
- Women drive coffee and tea restaurant loyalty
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- Figure 47: Restaurant loyalty by segment, by gender, April 2020
- Younger consumers are driving loyalty toward fast food
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- Figure 48: Restaurant loyalty by segment, by generation, April 2020
- Consumers of color also drive fast food loyalty
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- Figure 49: Restaurant loyalty by segment, by race and Hispanic origin, April 2020
- Parents are especially loyal to affordable, family-friendly fast food
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- Figure 50: Restaurant loyalty by segment, by parental status, April 2020
Reasons for Ceased Restaurant Loyalty
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- Restaurant loyalty doesn’t last forever for two fifths of consumers
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- Figure 51: Ceased restaurant loyalty status, April 2020
- Consumers who are currently restaurant loyal are also most likely to state changes in restaurant loyalty over time
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- Figure 52: Ceased restaurant loyalty status, by demographics, April 2020
- Just as service is a top loyalty motivator, decreased service quality is the top barrier
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- Figure 53: Reasons for ceased restaurant loyalty, April 2020
- Women in particular care about service quality
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- Figure 54: Reasons for ceased restaurant loyalty, by gender, April 2020
- Younger consumers are most likely to be lured away by competing restaurants
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- Figure 55: Reasons for ceased restaurant loyalty, by generation, April 2020
- Hispanic consumers are also most likely to switch to a competing restaurant
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- Figure 56: Reasons for ceased restaurant loyalty, by race and ethnic origin, April 2020
Loyalty Program Motivators
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- Monetary savings are top motivators for joining loyalty programs
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- Figure 57: Loyalty program motivators, April 2020
- More price-sensitive women in particular value monetary benefits
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- Figure 58: Loyalty program motivators, by gender, April 2020
- Millennials prioritize personalized loyalty program rewards
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- Figure 59: Loyalty program motivators, by generation, April 2020
- Black and Hispanic consumers are most interested in subscription-style loyalty program benefits
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- Figure 60: Loyalty program motivators, by race and ethnic origin, April 2020
Restaurant Loyalty Statement Agreement
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- There’s extremely high interest in restaurant loyalty programs
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- Figure 61: Restaurant loyalty statement agreement, April 2020
- Most men are more loyal to chains than independents
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- Figure 62: Restaurant loyalty statement agreement, by gender, April 2020
- Restaurant loyalty programs need to accept cash
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- Figure 63: Restaurant loyalty statement agreement, by generation, April 2020
- Black and Hispanic consumers drive loyalty to restaurant chains
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- Figure 64: Restaurant loyalty statement agreement, by race and ethnic origin, April 2020
- Parents are most open to loyalty programs from a wider variety of providers
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- Figure 65: Restaurant loyalty statement agreement, by parental status, April 2020
- Loyal restaurant consumers are highly engaged on social media
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- Figure 66: Restaurant marketing statement agreement, by restaurant loyalty status, April 2020
Appendix – Data Sources and Abbreviations
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- Data sources
- Consumer survey data
- Consumer qualitative research
- Abbreviations and terms
- Abbreviations
- Terms
Appendix – The Market
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- Figure 67: Total US revenues and forecasted sales ranges of restaurants and eating places*, by segment, at inflation-adjusted prices, 2014-24
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Appendix – The Consumer
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- CHAID analysis methodology
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- Figure 68: Restaurant purchasing in past three months, by restaurant loyalty status, April 2020
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- Figure 69: Restaurant loyalty statement agreement, by restaurant loyalty status, April 2020
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