Restaurant Breakfast and Brunch Trends: Incl Impact of COVID-19 - US - September 2020

OVERVIEW
What you need to know 
Key issues covered in this Report
Definition 
EXECUTIVE SUMMARY 
Top takeaways
Market overview
Figure 1: Total US sales and forecast of restaurants and limited-service eating places*, at current prices, 2015-25
Figure 2: Total US sales and forecast of restaurants and limited-service eating places*, at current prices, 2015-25
Impact of COVID-19 on foodservice breakfast and brunch
Figure 3: Short-, medium- and long-term impact of COVID-19 on foodservice breakfast and brunch
Opportunities and Challenges
Re-emergence
Figure 4: Change in breakfast ordering frequency before COVID-19; Anticipated change in breakfast ordering frequency in six months, net changes, by select demographics, July 2020
Deals can help LSRs stay competitive
Breakfast delivery can break up the mundane
Recovery
Figure 5: Breakfast/brunch interest, July 2020
Brunch stages a comeback
Restaurants will adjust to remote workers
THE MARKET – KEY TAKEAWAYS 
Foodservice breakfast faces challenging future
Consumers will cut out foodservice breakfast during a recession
Change in work behaviors will depress breakfast’s recovery
FOODSERVICE MARKET SIZE AND FORECAST 
Restaurant revenues plunge
Figure 6: Total US sales and forecast of restaurants and limited-service eating places*, at current prices, 2015-25
Figure 7: Total US sales and forecast of restaurants and limited-service eating places*, at current prices, 2015-25
Figure 8: US unemployment rate, January 2007–July 2020
Impact of COVID-19 on foodservice breakfast and brunch
Figure 9: Short-, medium- and long-term impact of COVID-19 on foodservice breakfast and brunch
Lockdown
Re-emergence
Recovery
COVID-19: US context
Learnings from the last recession
Figure 10: Annual personal consumption expenditures, foodservice, 2000-2019
Figure 11: Annual personal consumption expenditures, foodservice, 2000-2019
MARKET FACTORS 
Foodservice depends on discretionary income
Figure 12: US unemployment rate, January 2007–July 2020
Figure 13: Consumer confidence index, January 2007–July 2020
Shift to working from home will change how consumers eat
Figure 14: Employment status during pandemic, June 2020
Plant-based diets are trending
Figure 15: Dietary preferences, March 2020
MARKET OPPORTUNITIES 
Go big so they don’t stay home
Figure 16: Indulgent and savory breakfast menu items
Coffee can be a breakfast draw, but chains are already abandoning morning brews
Gen Z are high frequency snackers 
Figure 17: Dining out daypart frequency prior to COVID-19, by generation, once a week or more often, May 2020
Chains need to promote breakfast delivery
Figure 18: Delivery interest by occasion – net any restaurant segment, by race and ethnicity, May 2020
Consumers will be due for a brunch revival
Figure 19: How restaurants can make consumers feel safe when dining, July 2020
Price will be paramount
Attract remote workers in a post-pandemic world
COMPANIES AND BRANDS – KEY TAKEAWAYS 
Wendy’s breakfast entry creates new competition
Midscales innovate with delivery
Chains launch new coffee drinks and plant-based protein options
COMPETITIVE STRATEGIES
Wendy’s creates a new value war
Figure 20: Wendy’s Facebook ad, July 2020
Midscales use delivery to target families
Figure 21: IHOP Facebook ad, June 2020
Figure 22: Denny’s email “Packs that feed the fun!”, July 24, 2020
Coffee goes cold
Figure 23: Coffee drinks ordered away from home, any drink, by age, April 2020
Figure 24: Coffee LTOs launched in 2020
Plant-based proteins come to breakfast
Figure 25: Plant-based meat alternative menu items
Figure 26: Dunkin’ Beyond Sausage online ad, November 2019
THE CONSUMER – KEY TAKEAWAYS  
Consumers predict they will order breakfast less often in next six months
Parents want convenient, family-focused breakfast solutions
Independent FSRs may lose their core consumers
Adventure Eaters want plant-based options
FOODSERVICE DAYPART VISITATION
Breakfast lags behind other dayparts
Figure 27: Foodservice daypart visitation, July 2020
Millennials are core breakfast buyers
Figure 28: Foodservice daypart visitation, by generation, July 2020
Parents are in need of breakfast options
Figure 29: Foodservice daypart visitation, by parental status and age, July 2020
CHANGE IN ORDERING BREAKFAST BEFORE AND AFTER COVID-19
Consumers are mixed when considering future behaviors
Figure 30: Change in breakfast ordering frequency before COVID-19; Anticipated change in breakfast ordering frequency in six months, July 2020
Older consumers will drop out of the market
Figure 31: Change in breakfast ordering frequency before COVID-19; Anticipated change in breakfast ordering frequency in six months, net changes, by select demographics, July 2020
QSRs will need to rely on low prices to retain customers
Figure 32: Change in breakfast ordering frequency before COVID-19; Anticipated change in breakfast ordering frequency in six months, net changes, by foodservice segment visitors, July 2020
BREAKFAST AND BRUNCH ORDERING, BY SEGMENT
Loss of breakfast revenue will hurt QSR chains
Figure 33: Breakfast and brunch ordering by location, July 2020
Independents at risk of losing Baby Boomers
Figure 34: Breakfast and brunch ordering by location, net breakfast or brunch, by generation, July 2020
C-stores must innovate to compete with QSRs
Figure 35: Breakfast and brunch ordering by location, net breakfast or brunch, by food and drink shopper segmentation, July 2020
DEFINITION OF HEALTHY BREAKFAST/BRUNCH ITEMS
High protein and low sugar are universally appealing claims
Figure 36: Healthy breakfast/brunch item definition, July 2020
Attract Adventure Eaters with non-dairy options
Figure 37: Healthy breakfast/brunch item definition, by food and drink shopper segmentation, July 2020
BREAKFAST AND BRUNCH INTEREST
Rethink convenience in a post-pandemic world
Figure 38: Breakfast/brunch interest, July 2020
Figure 39: Breakfast/brunch interest, by foodservice segment visitors .July 2020
A comprehensive sanitation and safety program is good for business
Figure 40: Breakfast/brunch interest, by anticipated changes in breakfast/brunch ordering, July 2020
Adventure Eaters are early adopters of plant-based protein menu items
Figure 41: Breakfast/brunch interest, by food and drink shopper segmentation, July 2020
BREAKFAST AND BRUNCH BEHAVIORS
Remote workers are ordering less breakfast AFH
Figure 42: Breakfast/brunch behaviors, July 2020
Figure 43: Breakfast/brunch behaviors, by anticipated changes in breakfast/brunch ordering, July 2020
Gen Z and Millennials are sourcing breakfast via takeout and delivery
Figure 44: Breakfast/brunch behaviors, by generation, July 2020
Figure 45: Reasons for ordering delivery from restaurants more often than usual, any rank, by generation, May 2020
Target parents with delivery promotions
Figure 46: Breakfast/brunch behaviors, by parental status and age, July 2020
BREAKFAST AND BRUNCH ATTITUDES
Foodservice breakfast will be slow to recover
Figure 47: Breakfast and brunch attitudes, breakfast and COVID attitudes, any agree, July 2020
Figure 48: Breakfast and brunch attitudes, any agree, July 2020
Great coffee and innovative dishes can help chains retain Millennial customers
Figure 49: Breakfast and brunch attitudes, any agree, by generation, July 2020
Figure 50: Breakfast and brunch attitudes, any agree, by anticipated changes in breakfast/brunch ordering, July 2020
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Sales data
Forecast
Consumer survey data
Direct marketing creative
Mintel Food and Drink Shopper Segments
Abbreviations and terms
Abbreviations
APPENDIX – THE MARKET
Figure 51: Total US retail sales and forecast of foodservice revenues, at inflation-adjusted prices, 2015-25