Limited-service Breakfast - US - February 2007

SCOPE AND THEMES
What you need to know
Definition
Abbreviations and terms
Abbreviations
Terms
EXECUTIVE SUMMARY
Highlights
A growing market
Burritos, gourmet coffee, and big sandwiches
McDonald’s, Starbucks, BK, Dunkin’ lead industry
Operators selling humor
Only a minority eat LSR breakfast
Age-based trends
Looking for something new
Role of kids and gender
Trends by race/ethnicity
Promotions and discounts effective with minority of minorities
Residential expansion and LSR breakfast expansion
Competition to increase
The X factor: the budding war on obesity
MARKET DRIVERS
Overview
Time deprivation/convenience
Commute times growing
Figure 1: Commutes times in the U.S., 1990 and 2000
Employment
Figure 2: Size of the U.S. workforce, 2000-05
Competition from convenience stores
Figure 3: Number of convenience stores, 2000-05
Single-serve cereal aims to be car-friendly
Competition from breakfast bars—the ultimate convenience food
Differences by race/ethnicity
Figure 4: U.S. population, by race/ethnicity, 2001-11
Differences by age
Figure 5: Growth of the U.S. population, by age, 2001-11
MARKET SIZE AND TRENDS
Market size
Figure 6: Total U.S. retail sales of LSR breakfast, at current and constant prices, 2001-06
Beyond the bun: burritos, bagels, croissants, and biscuits
Enormous sandwiches
Coffee, fast casual, QSR segments blurring
Breakfast all day long
Premium breakfast
MARKET SEGMENTATION
Overview
Figure 7: U.S. sales of limited-service breakfast, segmented by type, 2004 and 2006
Standard LSRs
Figure 8: Total U.S. retail sales of LSR breakfast, at current and constant prices, 2001-06
Employer and school cafeterias
Figure 9: Total U.S. sales of breakfast at employee and school cafeterias,
MARKET OVERVIEW
Figure 10: Perceived advantages and disadvantages of segment leaders serving breakfast*
Figure 11: Selected breakfast menu additions, 2006-07
 COMPANIES AND BRANDS
McDonald’s
Starbucks
Burger King
Dunkin' Donuts
Quiznos
Sonic
Jack in the Box
Hardee’s/Carl’s Jr./CKE Restaurants
Panera Bread
Del Taco
Einstein Bros. Bagels (New World Restaurant Group)
Chick-fil-A
New entrants en route to market
ADVERTISING AND PROMOTION
Introduction
Figure 12: Restaurant ad spending in the U.S., 2004 and 2005
McDonald’s
Figure 13: Advertisement: McDonald’s #1
Figure 14: Advertisement: McDonald’s #2
Burger King
Chick-fil-A
Figure 15: Advertisement: Chick-fil-A
Dunkin’ Donuts
Figure 16: Advertisement: Dunkin’ Donuts
Panera Bread
Einstein Bros. Bagels
Sonic
Figure 17: Advertisement: Sonic
THE CONSUMER
Introduction
Summary
The frequent user
Eating breakfast out
Figure 18: Use of restaurants for breakfast, by gender, age and household income, May 2005-June 2006
Party composition
Figure 19: Party composition, by age, May 2005-June 2006
Figure 20: Party composition, by gender, May 2005-June 2006
Figure 21: Party composition, by household income, May 2005-June 2006
Figure 22: Party composition, by marital status, May 2005-June 2006
Figure 23: Party composition, by parental status, May 2005-June 2006
Frequency of eating breakfast out
Figure 24: Frequency of eating breakfast out, by gender, age, and household income, November 2006
Figure 25: Frequency of eating breakfast out, by household size and employment, November 2006
Weekday breakfast restaurant patronage
Figure 26: Weekday breakfast dining out, frequency by location, by age, November 2006
Figure 27: Chart: Weekday breakfast dining out, frequency by location, by age, November 2006
Weekday breakfasts: other demographics
Weekday breakfasts: 18-34s examined by race/ethnicity and gender
Figure 28: Weekday breakfast dining out, frequency by location, by age, gender, and race/ethnicity, November 2006
Weekend breakfast restaurant patronage
Figure 29: Weekend breakfast dining out, frequency by location, by age, November 2006
Weekend breakfasts: other demographics
Menu choices
Figure 30: Breakfast food preferences, by age, November 2006
Figure 31: Chart: Breakfast food preferences, by age, November 2006
Figure 32: Breakfast food preferences, by household income, November 2006
Beverages frequently or always ordered
Figure 33: Breakfast beverage preferences, by age, November 2006
Figure 34: Chart: Breakfast beverage preferences, by age, November 2006
Figure 35: Breakfast beverage preferences, by household income, November 2006
Restaurant loyalty
Figure 36: Breakfast restaurant loyalty, by age, November 2006
Figure 37: Breakfast restaurant loyalty, by household income, November 2006
Breakfast time management
Figure 38: Breakfast time management, by age, November 2006
Figure 39: Breakfast time management, by age, November 2006
Attitudes towards health and family and eating breakfast out
Figure 40: Opinions toward breakfast and health or family, by age, November 2006
Attitudes towards eating breakfast out
Figure 41: General attitudes toward breakfast, by age, November 2006
Exotic breakfast choices
Figure 42: Breakfast food choices, by age, November 2006
Figure 43: Breakfast food choices, by age, November 2006
Nutritional concerns
Figure 44: Breakfast nutritional concerns, by age, November 2006
Figure 45: Graph: Breakfast nutritional concerns, by age, November 2006
Breakfast restaurant selection criteria
Figure 46: Breakfast restaurant selection criteria, by age, November 2006
Figure 47: Breakfast restaurant selection criteria, by age, November 2006
 MINORITY RACIAL AND ETHNIC GROUPS
Penetration and frequency for eating breakfast out
Figure 48: Use of restaurants for breakfast, by race/ethnicity, May 2005-June 2006
Figure 49: Frequency of eating breakfast out, by race/ethnicity, November 2006
Party composition
Figure 50: Party composition, by race/ethnicity, May 2005-June 2006
Menu and restaurant selection
Figure 51: Menu selection, by race/ethnicity, November 2006
Figure 52: Beverage selection, by race/ethnicity, November 2006
Figure 53: Restaurant loyalty, by race/ethnicity, November 2006
Figure 54: Breakfast time management and activities, by race/ethnicity, November 2006
Figure 55: Opinions about healthy breakfasts and family outings, by race/ethnicity, November 2006
Figure 56: General attitudes toward breakfast, by race/ethnicity, November 2006
Figure 57: Exotic breakfast choices, by race/ethnicity, November 2006
Figure 58: Breakfast nutrition concerns, by race/ethnicity, November 2006
Figure 59: Breakfast restaurant selection criteria, by race/ethnicity, November 2006
FUTURE AND FORECAST
 FUTURE TRENDS
The war on obesity
Overview
Figure 60: Prevalence of overweight and obesity among U.S. adults, 1976-2002
Litigation raises public awareness
What consumers say they want…
…may not be what they will eat…
…and could result in reduced sales
More fruit
Incremental movement toward healthier offerings
Continued expansion of Hispanic-flavored breakfasts
Order ahead for fast casual
A crowded marketplace
Standing out in a crowd
Breakfast deliveries to home and work
Tea: the next coffee?
 MARKET FORECAST
Limited-service breakfast
Figure 61: Forecast of total U.S. sales of limited-service breakfast, at current and constant prices, 2006-11
Forecast factors
APPENDIX: TRADE ASSOCIATIONS