Table of Contents
Overview
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- What you need to know
- Key issues covered in this Report
- Definition
- COVID-19: quick service restaurant market context
Executive Summary
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- Top takeaways
- Market overview
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- Figure 1: Total US sales and fan chart forecast of limited-service restaurants*, at current prices, 2015-25
- Impact of COVID-19 on quick service restaurants
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- Figure 2: Short-, medium- and long-term impact of COVID-19 on quick service restaurants, March 2021
- Opportunities and challenges
- Fast food recovers fastest from pandemic challenges thanks to safety advantages
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- Figure 3: QSR attitudes – NET agreement, January 2021
- Digital ordering usage takes off at QSRs, opening up new doors
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- Figure 4: QSR technology experience, February 2020 and January 2021
- Fast food needs to get even faster to appease Gen Z
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- Figure 5: Factors for choosing a QSR – NET any rank, by generation, January 2021
- Many Millennials are OK with QSRs ditching the dining room
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- Figure 6: QSR attitudes – NET agreement, by generation, January 2021
- Fast food brand ethics need improvement
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- Figure 7: QSR attitudes – NET agreement, January 2021
The Market – Key Takeaways
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- LSRs come out of the COVID-19 crisis ahead with a fast recovery
- Rising food prices and value menu wars are QSR pain points
- Fast food struggles with less-than-ideal brand ethics perceptions
Market Size and Forecast
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- LSRs set for quick 2021 recovery from COVID-19 sales losses
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- Figure 8: Total US sales and fan chart forecast of limited-service restaurants*, at current prices, 2015-25
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- Figure 9: Total US sales and forecast of limited-service restaurants*, at current prices, 2015-25
- Impact of COVID-19 on quick service restaurants
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- Figure 10: Short-, medium- and long-term impact of COVID-19 on quick service restaurants, March 2021
- COVID-19: US context
Market Breakdown
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- Off-premise-focused LSRs steal market share in 2020 and beyond
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- Figure 11: Total US revenues and forecast of restaurants and eating places*, by segment, at current prices, 2015-25
- Figure 12: Market share of total US sales and forecast of restaurant and eating places*, by segment, 2019-25
- Fast casual growth outpaces fast food leading into pandemic
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- Figure 13: Percentage share of Top 200 limited-service restaurant sales, by segment, 2017-19*
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- Figure 14: Top 200 limited-service restaurant sales and percentage sales growth by segment, 2017-19*
Market Factors
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- 2021 economic recovery period will benefit QSRs even more than Great Recession recovery
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- Figure 15: Total US quick service restaurant sales, at current prices, 2008-13
- Ingredient shortages, high prices present QSR challenges
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- Figure 16: Changes in consumer food price indexes, 2019-21
- Federal minimum wage increase sees ongoing hurdles
Market Opportunities
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- Automated off-premise is the next wave of speed and convenience
- Walking the walk with racial justice
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- Figure 17: Starbucks’ June 4, 2020, Instagram post
- Menu bundling, celebrity marketing can prove value
- Sustainability sells
Companies and Brands – Key Takeaways
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- The pandemic reroutes sales trends for coffee and pizza QSRs
- QSRs double down on digital and drive-thru, and ditch the dining room
QSR Chain Performance
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- Subway struggles to keep up, Chick-fil-A continues sales boom in 2019
- The big brand winners and losers of 2019 see similar track records in 2020
- Coffee QSRs entered 2020 strong, but faltered amid pandemic
- Pizza QSRs entered 2020 slow but immediately saw big pandemic benefits
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- Figure 18: Leading 10 QSR chains among Top 200 chains, 2018-2019
Competitive Strategies
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- Nostalgic, comfort dishes take over the menu at QSRs
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- Figure 19: Mintel’s Menu Matrix – Top leading entrée menu dishes (1-10) at QSRs, Q3 2017-20
- 2021: the year of the drive-thru and ditching dining rooms
- Loyalty programs increasingly drive traffic
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- Figure 20: Wendy’s email “Get 2X points on both poppers,” February 22, 2021
The Consumer – Key Takeaways
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- Fast food chains recover from pandemic sales losses the fastest due to competitive advantages but still have room for improvement
- Demand for faster, more automated off-premise options is positioned for future growth
- Digital ordering and loyalty program opportunities shoot up during pandemic
Restaurant Ordering by Segment
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- Fast food sees the fastest pandemic recovery, will continue to gain market share
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- Figure 21: Restaurant ordering by segment, February 2020 and January 2021
QSR Ordering Frequency
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- Fast food is habit-forming
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- Figure 22: QSR ordering frequency, January 2021
- QSRs and c-stores share the same frequent customers
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- Figure 23: QSR ordering frequency, by Frequent QSR Consumer demographics, January 2021
Factors for Choosing a QSR
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- QSRs should invest in convenience to boost traffic
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- Figure 24: Factors for choosing a QSR – NET any rank, January 2021
- Gen Z drives the need for speed
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- Figure 25: Factors for choosing a QSR – NET any rank, by generation, January 2021
- Some parents want the dine-in experience at QSRs for family occasions
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- Figure 26: Factors for choosing a QSR – NET any rank, by parental status, January 2021
QSR Drive-Thru Use, Motivators and Barriers
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- Drive-thru service is a necessity
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- Figure 27: QSR drive-thru use, January 2021
- Drive-thrus attract new customers outside of core QSR customer base
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- Figure 28: QSR drive-thru use, by select demographics, January 2021
- Drive-thru sets the safety standard
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- Figure 29: QSR drive-thru motivators, January 2021
- Help hurried parents with a more streamlined drive-thru experience
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- Figure 30: QSR drive-thru motivators, by parental status and gender, January 2021
- QSRs must improve drive-thru accuracy and speed to reduce barriers
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- Figure 31: QSR drive-thru barriers, January 2021
QSR Drive-Thru Experience
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- QSRs can improve drive-thru satisfaction via speed and order accuracy
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- Figure 32: QSR drive-thru experience, January 2021
- Impulsive younger consumers are target audience for drive-thru upsell opportunities
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- Figure 33: QSR drive-thru experience, by generation, January 2021
QSR Technology Experience
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- Preordering technology adoption surges the most due to pandemic
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- Figure 34: QSR technology experience, February 2020 and January 2021
- Millennials drive growth of most QSR technology
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- Figure 35: QSR technology experience, by generation, January 2021
Desired QSR Improvements
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- Despite taking a backseat during pandemic, sustainability remains important to QSR customers
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- Figure 36: Desired QSR improvements, January 2021
- Women want faster, safer off-premise options from QSRs
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- Figure 37: Desired QSR improvements, by gender, January 2021
- Gen Z cares more about chicken and snack items than health at QSRs
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- Figure 38: Desired QSR improvements, by generation, January 2021
QSR Attitudes
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- Loyalty programs are an important visitation driver
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- Figure 39: QSR attitudes – NET agreement, January 2021
- Cater to Millennials with automated, off-premise-only concepts
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- Figure 40: QSR attitudes – NET agreement part I, by generation, January 2021
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- Figure 41: QSR attitudes – NET agreement part II, by generation, January 2021
- Dads are key to loyalty program payoff
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- Figure 42: QSR attitudes – NET agreement, by parental status and gender, January 2021
Appendix – Data Sources and Abbreviations
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- Data sources
- Sales data
- Forecast methodology
- Consumer survey data
- Direct marketing creative
- Abbreviations and terms
- Abbreviations
- Terms
Appendix – The Market
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- Figure 43: Total US sales and forecast of limited-service restaurants*, at inflation-adjusted prices, 2015-25
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Appendix – Companies and Brands
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- Mintel Menu Matrix Methodology
Appendix – The Consumer
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- Figure 44: Convenience store visitation frequency, by Heavy C-Store Consumers and demographics, December 2020
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- Figure 45: QSR drive-thru experience, by parental status, January 2021
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- Figure 46: QSR technology experience, by household income, January 2021
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