Flavor Innovation on the Menu - US - October 2018

OVERVIEW
What you need to know
Definition
EXECUTIVE SUMMARY 
Overview
The issues
One third of diners are adventurous, but the majority still stick to what they know
Figure 1: Self-segmentation – Dining out, July 2018
Range of barriers limit trial of new tastes and foods
Figure 2: New food trial barriers, by segment, July 2018
The opportunities
Adventurous eaters tend to be younger, more diverse, and affluent
Figure 3: Demographic profile of consumers who consider themselves adventurous eaters, July 2018
Adventurous eaters seek out a wide variety of flavors
Figure 4: Interest in flavor, for adventurous eaters, July 2018
Many factors and tools can propel diners to try new ingredients
Figure 5: Trial motivators – Any rank, July 2018
New spins on comfort food classics can appeal to diners
Figure 6: Dining out attitudes – Any agree, July 2018
What it means
THE MARKET – WHAT YOU NEED TO KNOW
Positive macroeconomics propel growth, but landscape is competitive
Adventurous iGens and Millennials seek diverse, trendy, international fare
Weight-loss and wellness goals continue to shape menu innovation
MARKET PERSPECTIVE
AFH food consumption grows, although prices rising faster for AH food
Figure 7: At home and away from home food sales, January 2003-August 2018
Diverse, competitive retail landscape with fast casual growing in reach
Figure 8: Total US revenues and forecast of restaurants and eating places*, by segment, at current prices, 2016-23
Menu innovation is widespread across segments
Figure 9: Menu incidence change, by restaurant segment, Q2 2015-18
Expanded foodservice in grocery stores and c-stores compounds competition
Coffee shops and breweries expand their reach, appeal to younger generations
MARKET FACTORS 
Positive macroeconomics allow more spending and experimentation
Figure 10: Consumer confidence and unemployment, 2000-August 2018
Younger generations are engaged, open to variety and innovation
Figure 11: US population aged 18+, by generation, 2013-23
Affluent and aging boomers will also drive demand, especially for traditional and healthy food
Multicultural diversity shapes consumer base
Figure 12: Distribution of population, by age race/Hispanic origin, 2018
Adventurous parents drive demand for innovative family-friendly fare
Health and weight concerns drive interest in quality, healthful food
KEY PLAYERS – WHAT YOU NEED TO KNOW 
Global flavor profiles and fresh, healthy ingredients drive demand
Refreshed American fare, comfort food, and meats draw consumers
Select chains and casual family restaurants struggle to adapt
Technology may give access to more varied, customized menus
Trucks, food halls, and new store concepts bring new options to foodies
WHAT’S WORKING?
Global flavor profiles and bold use of spice
Figure 13: Menu incidence change, by menu item cuisine type, Q2 2015-18
International foods bring new flavors and spices to menus
Healthy living drives demand for clean, organic, and vegetarian fare
Figure 14: Menu incidence change, by select ingredients, Q2 2015-18
Figure 15: Menu incidence change, by select menu item claims, Q2 2015-18
Bowls offer healthy, fresh ingredients in customizable forms
Mocktails on the rise, while kombucha emerges as popular healthful drink
Regional American favorites and new takes on comfort food
Figure 16: Menu incidence change, by North American cuisine type, Q2 2015-18
Meats and “meaty” flavors dominate for mains and are likely to grow
Grilling draws out “meaty” flavors and adds “smoky” and other savory notes
Spices and next generation vegan “meats” expand access to “meaty” flavors
WHAT’S STRUGGLING?
Casual dining struggles, losing share to nimbler, innovative fast casual
Struggles of sandwich chains show pitfalls of overexpansion and stagnant menus lacking innovation
WHAT’S NEXT?
Digital innovations can expand access and menu customization
New concepts support food sampling, customization, and new fare
THE CONSUMER – WHAT YOU NEED TO KNOW 
About a third self-identify as “adventurous eaters”
Almost three quarters either like or love spicy foods
Fear they won’t like the taste is a main barrier for diners trying new food
Recommendations of friends/family often motivates trial
Flavor preferences vary for mains, side dishes, and desserts
Robust interest in LTOs, especially those unique to a restaurant
Many open to trendy, international cuisine, but still love comfort food
ADVENTUROUS EATERS 
A third are adventurous, but the majority stick to what they know
Figure 17: Self-segmentation – Dining out, July 2018
Millennials and parents are more likely to be adventurous
Figure 18: Demographic profile of self-segmentation – Dining out, July 2018
Hispanics and Asians less likely to have middle-ground attitude to food
Figure 19: Self-segmentation – Dining out, by race/Hispanic origin, July 2018
SPICY FOOD LOVERS
Three quarters like – or love! – spicy food
Figure 20: Self-segmentation – Spicy, July 2018
Adventurous food eaters especially likely to prize spice
Figure 21: Self-segmentation – Spicy, by self-segmentation – Dining out, July 2018
Younger consumers, parents, and men often embrace spice
Figure 22: Profile of self-segmentation – Spicy, by key demographics, July 2018
Asians, Pacific Islanders, and Hispanics more likely to love spicy food
Figure 23: Self segmentation – Spicy, by race and Hispanic origin, July 2018
BARRIERS TO TRYING NEW FOOD
Fear of not liking the taste is prime barrier to trying new food
Figure 24: New food trial barriers, July 2018
Less adventurous cite multiple obstacles to trying new foods
Figure 25: New food trial barriers, by self-segmentation – Dining out, July 2018
Gender shapes barriers to trying new foods
Figure 26: New food trial barriers, by gender, July 2018
Older generations’ fear of not liking new tastes limits adventurousness
Figure 27: New food trial barriers, by generation, July 2018
TRIAL MOTIVATORS
Recommendations are top-ranked reason for trying new food
Figure 28: Trial motivators, July 2018
The adventurous more likely to look to server, reviews, and social media
Figure 29: Trial motivators, by self-segmentation – Dining out, July 2018
Among parents, social media recommendations are more important
Figure 30: Trial motivators, by parental status, July 2018
FLAVOR PREFERENCES
Four flavors dominate, but many others offer nuance and variety
Figure 31: Interest in flavor, for any menu item, July 2018
Adventurous eaters seek greater number and wider range of flavors
Figure 32: Interest in flavor, by self-segmentation – Dining out, July 2018
Men seek meaty flavors, while women favor milder, vegetarian flavors
Figure 33: Interest in flavors, by gender, July 2018
Supporting foodie profile, younger generations seek range of flavors
Figure 34: Interest in flavors, by generation, July 2018
INTEREST IN FLAVOR BY MENU ITEM
“Meaty” most popular flavor for mains, “cheesy” sought in side dishes
Figure 35: Interest in flavor, for main entrees and side dishes, July 2018
For dessert, consumers seek “sweet,” “fruity,” and “nutty” flavors
Figure 36: Interest in flavor, for dessert, July 2018
Breakfast tastes are varied, as consumers embrace a range of flavors
Figure 37: Interest in flavor, for breakfast, July 2018
For drinks, “sweet” and “fruity” are dominant flavors
Figure 38: Interest in flavor, for beverages, July 2018
LTO INTEREST
Half motivated by “unique to restaurant” LTO menu items
Figure 39: Interest in limited time menu items, July 2018
Top five LTOs will appeal to over four fifths of diners
Figure 40: TURF analysis – LTO interest, July 2018
LTOs appealing to 95% of adventurous eaters
Figure 41: Interest in limited time menu items, by self-segmentation – Dining out, July 2018
Sweeter, healthier LTOs appeal to women, “over the top” LTOs to men
Figure 42: Interest in limited time menu items, by gender, July 2018
Younger diners eager for range of LTOs, including “over the top” fare
Figure 43: Interest in limited time menu items, by generation, July 2018
Parents eager for sweet and indulgent fare in LTOs
Figure 44: Interest in limited time menu items, by parental status, July 2018
ATTITUDES TOWARD CUISINE AND RESTAURANTS
Many open to trendy and international cuisine, but still love comfort food
Figure 45: Attitudes toward different types of foods, cuisines, and textures, July 2018
Attitudes support innovation, bigger condiment bars, and savvy servers
Figure 46: Attitudes toward restaurants, July 2018
The adventurous embrace trendy and international food
Figure 47: Attitudes toward different types of foods, cuisines, and textures, by self-segmentation – Dining out, July 2018
Adventurousness shapes attitudes to servers, condiments, and more
Figure 48: Attitudes toward restaurants, by self-segmentation – Dining out, July 2018
Women value texture, and are more open to international, “trendy” fare
Figure 49: Select attitudes toward food and restaurants, by gender, July 2018
iGens and Millennials more likely to embrace international, trendy fare
Figure 50: Select attitudes toward food and restaurants, by generation, July 2018
Parents’ attitudes show high interest in international and trendy fare
Figure 51: Select attitudes toward food and restaurants, by parental status, July 2018
Hispanics value comfort food, eager for wider condiment selection
Figure 52: Select attitudes toward food and restaurants, by Hispanic origin, July 2018
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Consumer survey data
Abbreviations and terms
Abbreviations
Terms
APPENDIX – TURF ANALYSIS
Figure 53: Table – TURF analysis – LTO interest, July 2018
APPENDIX – CONSUMER
Figure 54: Interest in flavor, for mains, by generation, July 2018
Figure 55: Interest in flavor, for mains, by gender, July 2018
Figure 56: Interest in flavor, for dessert, by gender, July 2018
Figure 57: Interest in flavor, for dessert, by generation, July 2018