Burger and Chicken Restaurants - UK - August 2014

INTRODUCTION
Definition
Abbreviations
EXECUTIVE SUMMARY
The market
Figure 1: UK chicken and burger bar market, value sales, 2009-19
Market factors
Companies, brands and innovation
Leading players plan expansion
Who’s innovating?
The consumer
Venues visited
Figure 2: Fast food outlet/restaurant usage, May 2014
Barriers to using fast food restaurants
Figure 3: Barriers to using fast food restaurants, May 2014
Attitudes towards fast food outlets
Figure 4: Users’ attitudes towards fast food outlets, May 2014
Menu enticements
Figure 5: Chicken/burger bar menu enticements, May 2014
Venue enticements
Figure 6: Chicken/burger bar venue enticements, May 2014
What we think
ISSUES AND INSIGHTS
Drinks and fries offer scope for operators to tap demand for customisation
The facts
The implications
‘Stealth health’ and signposting can help address health concerns
The facts
The implications
Digital loyalty programs can provide a platform for push marketing
The facts
The implications
TREND APPLICATION
Encouraging healthier consumer habits
Play whilst you queue
Faster fast food
MARKET DRIVERS
Key points
Consumers find themselves in a better financial situation in 2014
Better-off consumers are more health-aware
Health concerns are a key barrier to fast food venue usage
Fast food’s core user group set to shrink between 2014 and 2019
Figure 7: Trends in the age structure of the UK population, 2009-14 and 2014-19
STRENGTHS AND WEAKNESSES
Strengths
Weaknesses
WHO’S INNOVATING?
Key points
Healthier fare at fast food outlets
Fast food continues to raise health concerns
Signposting better-for-you menu items
Operators explore ‘stealth health’
McDonald’s leads the way with modern marketing initiatives
Social media
Interactive content
The Happy Meal gift gets a digital update
Nando’s and GBK look to drive engagement online and through apps
New products appeal to consumers
Seasoned chips
South American flavours
Simple dishes at the premium end
MARKET SIZE AND FORECAST
Key points
Outlet expansion and positive consumer sentiment expected to support growth in 2014
Figure 8: UK chicken and burger bar market, value sales, 2009-19
Positive consumer sentiment should benefit dining out
Leading operators note expansion plans
The market faces competition from fast casual venues and the retail market
Expansion to new occasions has supported recent growth
Falling number of 20-24s and weak health perceptions pose a challenge for the market
Figure 9: UK chicken and burger bar market, value sales, 2009-19
Forecast methodology
SEGMENT PERFORMANCE
Key points
Burger bars
Figure 10: UK burger bar market, value sales, 2009-19
Figure 11: UK burger bar market, value sales, 2009-19
Chicken bars
Figure 12: UK chicken bar market, value sales, 2009-19
Figure 13: UK chicken bar market, value sales, 2009-19
COMPANIES AND PRODUCTS
Key points
Overview
Figure 14: Selected chicken and burger restaurant chains, by outlet numbers, 2012-14
Burger King
Recent developments
Menu developments
McDonald’s
Financial results
Figure 15: Key financials for McDonald’s Restaurants Limited, 2009-12
Outlet portfolio
Recent developments
Menu developments
KFC
Financial results
Figure 16: Key financials for Kentucky Fried Chicken (Great Britain) Limited, 2007/08-2011/12
Recent developments
Menu developments
Wimpy
Financial results
Figure 17: Key financials for Wimpy Restaurants Group Ltd, 2009/10-2012/13
Recent developments
Nando’s
Financial results
Figure 18: Key financials for Nando’s Chickenland Limited, 2008/09-2012/13
Company strategy and recent developments
Menu developments
Retail range developments
BRAND ADVERTISING, PERCEPTIONS AND SOCIAL MEDIA
 BRAND ADVERTISING
Key points
Nando’s and McDonald’s ramp up advertising spend in attempt to broaden customer base
Figure 19: Advertising expenditure by selected chicken and burger bar operators, 2010-14
McDonald’s looks to Millennials
Nando’s hopes to go mainstream
KFC looks to emotional themes
Establishing a lifestyle positioning
Personalised marketing
 BRAND PERCEPTIONS
Figure 20: Key brand metrics, April 2014
Brand map
Figure 21: Attitudes towards and usage of brands in the burger and chicken restaurant sector, April 2014
Correspondence analysis
Brand attitudes
Figure 22: Attitudes, by burger and chicken restaurant brand, April 2014
Brand personality
Figure 23: Burger and chicken restaurant brand personality – Macro image, April 2014
Figure 24: Burger and chicken restaurant brand personality – Micro image, April 2014
Brand usage
Figure 25: Burger and chicken restaurant brand usage, April 2014
Brand experience
Figure 26: Burger and chicken restaurant brand experience, April 2014
 SOCIAL MEDIA AND ONLINE BUZZ
Social media metrics
Figure 27: Social media metrics of selected burger and chicken restaurant brands, July 2014
Online mentions
Figure 28: Online mentions of selected burger and chicken restaurant brands, April 2014
Brands hold generally consistent shares in conversation, with a few exceptions
Nando’s and Subway see the transfer of offline stories into online content
KFC spike is encouraged by television advertising
Topics of discussion
Figure 29: Topics of discussion around selected burger and chicken restaurant brands, April 2014
People appear most likely to talk about these brands before visiting
The food is spoken about less than the idea of the brands themselves
KFC and McDonald’s drive promotional chatter
Where do people talk about these brands
Brand conversation largely occurs in personal conversation
Figure 30: Share of brand conversation of different types of site, 30 June 2013-28 June 2014
Microblogs appear to drive mentions
Analysis by brand
McDonald’s
Figure 31: Topic cloud around mentions of McDonald’s, 30 June 2013-28 July 2014
Nando’s
Figure 32: Average distribution of mentions of Nando’s, by hour of day, 27 January 2014 and 30 June 2013-28 July 2014
KFC
Figure 33: Topic cloud around mentions of KFC, 30 June 2013-28 July 2014
Subway
Figure 34: Topic cloud around mentions of Subway, 30 June 2013-28 July 2014
Burger King
Figure 35: Topic cloud around mentions of Burger King, 30 June 2013-28 July 2014
THE CONSUMER – FAST FOOD USAGE HABITS
Key points
Fast food outlet visits
Figure 36: Fast food outlet/restaurant usage, May 2014
Families and young adults remain fast food venues’ core users
Fast food’s appeal wanes with age
McDonald’s remains the most widely used brand
Subway lags behind McDonald’s on usage despite broader store portfolio
Frequency of visiting fast food outlets/restaurants
Figure 37: Frequency of fast food outlet usage, May 2014
Repertoire of fast food outlet/restaurant usage
Figure 38: Repertoire of fast food outlet/restaurant usage, by outlet used, May 2014
THE CONSUMER – BARRIERS TO USING FAST FOOD RESTAURANTS
Key points
Poor health perceptions remain an issue for fast food
Figure 39: Barriers to using fast food restaurants, May 2014
Almost half of adults think fast food is not good for you
Fast food – A choice?
Operators signpost healthier options
Quality of ingredients concerns one in four
Three in 10 over-65s think fast food is for the young
THE CONSUMER – ATTITUDES TOWARDS FAST FOOD OUTLETS
Key points
Despite health concerns, calories are rarely seen as a put-off
Figure 40: Users’ attitudes towards fast food outlets, May 2014
Fast food outlets are not the venue of choice for healthier dishes
Coffee offering supports footfall
Competition from specialists remains a challenge
Strong value image should resonate at lunch
THE CONSUMER – CHICKEN/BURGER BAR MENU ENTICEMENTS
Key points
Three in five fast food diners would like to customise dishes
Figure 41: Chicken/burger bar menu enticements, May 2014
High interest in customisation favours competing venues
McDonald’s trials customised burgers in US
Chips can offer a platform for tailoring
Drinks can lend themselves to customisation
Healthier options would appeal to more than half of fast food diners
Salads struggle on fast food menus
Dishes must deliver on the fast food experience
Menus can play a role in communicating healthier options
THE CONSUMER – CHICKEN/BURGER BAR VENUE ENTICEMENTS
Key points
Two in five fast food diners are open to digital loyalty programmes
Figure 42: Chicken/burger bar venue enticements, May 2014
Strong interest in loyalty programmes
Push marketing welcomed by one in three diners
Pre-ordering appeals to two in five fast food diners
One in five would participate in online competitions
APPENDIX – MARKET DRIVERS
Figure 43: Trends in how respondents would describe their financial situation, February 2009-June 2014
Figure 44: Trends in what extra money is spent on, selected items, November 2009-June 2014
APPENDIX – MARKET SIZE AND FORECAST
Figure 45: UK chicken and burger bar market, value sales, best- and worst-case forecast, 2014-19
Figure 46: UK burger bar market, value sales, best- and worst-case forecast, 2014-19
Figure 47: UK chicken bar market, value sales, best- and worst-case forecast, 2014-19
APPENDIX – BRAND ADVERTISING, PERCEPTIONS AND SOCIAL MEDIA
Figure 48: Advertising expenditure by selected chicken and burger bar operators, by media type, 2013
Figure 49: Brand usage, July 2014
Figure 50: Brand commitment, July 2014
Figure 51: Brand momentum, July 2014
Figure 52: Brand diversity, July 2014
Figure 53: Brand satisfaction, July 2014
Figure 54: Brand recommendation, July 2014
Figure 55: Brand attitude, July 2014
Figure 56: Brand image – Macro image, July 2014
Figure 57: Brand image – Micro image, July 2014
Figure 58: Share of online conversation of selected burger and chicken restaurant brands, 28 June 2013-30 June 2014
Figure 59: Topics of discussion around selected burger and chicken restaurant brands, 28 June 2013-30 June 2014
APPENDIX – THE CONSUMER – FAST FOOD USAGE HABITS
Figure 60: Fast food outlet/restaurant usage, May 2014
Figure 61: Most popular fast food outlets used, by demographics, May 2014
Figure 62: Next most popular fast food outlets used, by demographics, May 2014
Repertoire analysis
Figure 63: Repertoire of fast food outlets/restaurants used, May 2014
Figure 64: Repertoire of fast food outlet usage, by demographics, May 2014
Figure 65: Fast food outlets used, by repertoire of fast food outlet usage, May 2014
Figure 66: Frequency of fast food outlet usage, May 2014
Figure 67: Frequency of fast food outlet usage – McDonald’s, by demographics, May 2014
Figure 68: Frequency of fast food outlet usage – KFC, by demographics, May 2014
Figure 69: Frequency of fast food outlet usage – Subway, by demographics, May 2014
Figure 70: Frequency of fast food outlet usage – Burger King, by demographics, May 2014
Figure 71: Frequency of fast food outlet usage – Nando’s, by demographics, May 2014
APPENDIX – THE CONSUMER – BARRIERS TO USING FAST FOOD RESTAURANTS
Figure 72: Barriers to using fast food venues, May 2014
Figure 73: Most common barriers to using fast food venues, by demographics, May 2014
Figure 74: Next most common barriers to using fast food venues, by demographics, May 2014
Figure 75: Other barriers to using fast food venues, by demographics, May 2014
Figure 76: Barriers to using fast food venues, by most popular fast food outlets used, May 2014
Figure 77: Barriers to using fast food venues, by next most popular fast food outlet used, May 2014
APPENDIX – THE CONSUMER – ATTITUDES TOWARDS FAST FOOD OUTLETS
Figure 78: Attitudes towards fast food outlets, May 2014
Figure 79: Most popular attitudes towards fast food outlets, by demographics, May 2014
Figure 80: Next most popular attitudes towards fast food outlets, by demographics, May 2014
Figure 81: Attitudes towards fast food outlets, by most popular fast food outlet used, May 2014
Figure 82: Attitudes towards fast food outlets, by next most popular fast food outlet used, May 2014
APPENDIX – THE CONSUMER – CHICKEN/BURGER BAR MENU ENTICEMENTS
Figure 83: Chicken/burger bar menu enticements, May 2014
Figure 84: Chicken/burger bar menu enticements – Option to customise dishes, by demographics, May 2014
Figure 85: Chicken/burger bar menu enticements – Reduced fat/calorie items, by demographics, May 2014
Figure 86: Chicken/burger bar menu enticements – New cold drink options, by demographics, May 2014
Figure 87: Chicken/burger bar menu enticements – Option to choose type of bun, by demographics, May 2014
Figure 88: Chicken/burger bar menu enticements – Food higher in protein, by demographics, May 2014
Figure 89: Chicken/burger bar menu enticements – Seasoned chips, by demographics, May 2014
Figure 90: Chicken/burger bar menu enticements – Loaded chips, by demographics, May 2014
Figure 91: Chicken/burger bar menu enticements – New breakfast options, by demographics, May 2014
Figure 92: Chicken/burger bar menu enticements – New dessert options, by demographics, May 2014
Figure 93: Chicken/burger bar menu enticements – New American food options, by demographics, May 2014
Figure 94: Chicken/burger bar menu enticements – Tex Mex dishes, by demographics, May 2014
Figure 95: Chicken/burger bar menu enticements – Alcohol^, by demographics, May 2014
Figure 96: Chicken/burger bar menu enticements, by most popular fast food outlets used, May 2014
Figure 97: Chicken/burger bar menu enticements, by next most popular fast food outlets used, May 2014
APPENDIX – THE CONSUMER – CHICKEN/BURGER BAR VENUE ENTICEMENTS
Figure 98: Chicken/burger bar venue enticements, May 2014
Figure 99: Chicken/burger bar venue enticements – Digital loyalty programme, by demographics, May 2014
Figure 100: Chicken/burger bar venue enticements – Drinks happy hour, by demographics, May 2014
Figure 101: Chicken/burger bar venue enticements – Pre-ordering before you get to the venue, by demographics, May 2014
Figure 102: Chicken/burger bar venue enticements – Customised offers sent to your smartphone based on factors such as your location, time of day etc, by demographics, May 2014
Figure 103: Chicken/burger bar venue enticements – Restaurant app that provides nutritional information, by demographics, May 2014
Figure 104: Chicken/burger bar venue enticements – Charging stations for electrical devices at the venue, by demographics, May 2014
Figure 105: Chicken/burger bar venue enticements – Smartphone payments, by demographics, May 2014
Figure 106: Chicken/burger bar venue enticements – Prepaid/top-up card, by demographics, May 2014
Figure 107: Chicken/burger bar venue enticements – Participate in live/interactive online competitions, by demographics, May 2014
Figure 108: Chicken/burger bar venue enticements, by most popular fast food outlets used, May 2014
Figure 109: Chicken/burger bar venue enticements, by next most popular fast food outlets used, May 2014