?? Restaurant Roundup 9th May 2024

?? Get the latest scoop on the hottest hospitality trends served with a side of expert insights, from Choipotle's 40 Million Member Success to Value Messaging

? Let’s Check In!

?? Game-Changing Trends for Restaurants

• A recent report found that nearly four in ten social media users who are also QSR brand consumers spend more time playing mobile games than on social media. This is significantly higher than the average for all social media users. According to the report, if QSR brands had effectively reached this Mobile Gaming-First segment, they could have increased their reach across the entire QSR audience by 18%. The report highlights the need for a deeper understanding of media engagement and its impact on effective advertising reach. (MRM)

• ?? Here's how restaurants can target the mobile-gaming-first segment:

• Use in-game advertising to place ads directly within popular mobile games, your choice of game will depend on your customer interests, the game's genre and player demographics.
• Sponsor in-game events, offer exclusive rewards for players, or even integrate the restaurant brand into the game itself.
• Collaborate with gaming influencers and streamers to promote offers and build brand awareness within this audience.

?? Chipotles Rewards Programme Surpasses 40 Million Members

• Chipotle's remarkable sales growth of 14%, amounting to $2.7 billion, occurred during the first quarter of 2024. This growth was driven by a 7% increase in stores open for over a year. In-store sales increased 19% compared to the previous year, while digital sales accounted for 37% of the total sales. The brand also opened 47 new restaurants, including 43 Chipotlanes, its digital drive-thrus.
• The loyalty program has also been enrolled by more than 40 million customers. CEO Niccol attributed the sales growth to the brand's focus on improving throughput in its restaurants and successful marketing campaigns. He also mentioned the company's exploration of technology tools to enhance team member productivity and overall customer experience. (HT)

• ?? One of the best ways to keep customers coming back and strengthen your customer base is to have a loyalty program in place. By balancing digital and traditional media, you can expand your brand's reach. Younger generations, are more inclined to brands that share their values so make sure you communicate these on landing pages, emails and ads. Keeping your menu innovative and collaborating with others can help keep things interesting while maintaining your brand's identity.?

?? McDonald's Warns of Consumer Squeeze Amid Inflation

• A major concern for American corporations is the impact of rising prices on their customers due to inflation. This has been a dominant topic for the past few years, especially after the pandemic and government stimulus efforts. While inflation has slowed since the Federal Reserve's actions in 2022, consumers are still feeling the effects and being more cautious with their spending.?
• McDonald's CEO Chris Kempczinski acknowledged the pressure on consumers and their tendency to be more selective with their spending. The persisting inflation has also affected the public's perception of the economy, with consumer confidence at its lowest level since April 2022. (CNBC)

• ?? The exact duration of these market conditions is difficult to predict; but marketing can play a crucial role by understanding how consumer behaviour changes and adjusting strategies accordingly.?

• Focus messaging on affordability and promotions to appeal to price-sensitive consumers and communicate value.?
• Be upfront about price changes and the reasons behind them to foster trust.
• Stay agile and prepare to adapt messaging and offers quickly in response to shifting market conditions.

?? Value Messaging Takes Centre Stage in Restaurant Marketing Tactics

• One example of how restaurants adapt to the economic environment is Chili's, which recently introduced a new burger, the Big Smasher, marketed as a direct competitor to McDonald's Big Mac. Industry expert Heather Lalley said that Chilli's is engaging in the "street fighting" tactics that McDonald's CFO Ian Borden recognised would be necessary to compete in this difficult environment. "All of this is potentially good news for deal-hunting diners. But it's going to be a challenge for restaurant marketers to communicate value, value, value. They just may want to take a page out of Chili's playbook." (RBO)

• ?? Chili's marketing strategy offers a valuable lesson for other restaurants. By tapping into the powerful emotions of nostalgia, they've successfully targeted the large millennial demographic. Chilli's is not fighting for your taste buds; they're fighting for your heart.?
• Restaurants should turn to their brand's history to evoke nostalgia. From classic jingles to decor, find iconic elements that spark childhood memories. Updating these elements with a modern twist creates a sense of familiarity while still catering to contemporary tastes.?

?? Shake Shack Boosts Marketing Efforts to Retain Customers Amid Market Shifts

• In Q1, Shake Shack witnessed a 1.6% rise in same-store sales but experienced a 2.1% decline in traffic. To counter the impact of the challenging economic climate, the company has revealed plans to strengthen its marketing efforts to increase brand awareness. Shake Shack has also observed regional variations in traffic, with the Southeast exhibiting a mid-single-digit growth in traffic. (RB)

• ?? When restaurants face a decline in traffic and economic challenges, it is imperative to conduct a thorough analysis before launching any new marketing efforts. You should assess the sales data, website traffic, and customer feedback to identify trends and how they relate to broader economic conditions.?
• To ensure that your messaging aligns with your evolving target audience, you should conduct a competitor audit and adjust your approach as necessary. To boost your marketing, consider highlighting value-driven offerings, increasing targeted advertising, seeking strategic partnerships, and prioritising customer experience to encourage positive recommendations.

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