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Five Strategic Trends
The Trends Breakfast at the 2013 BC Foodservice Expo shared insights into food trends and consumer behaviour.
By Cheryl Mah
Operators and manufacturers who are successful in today’s competitive marketplace are the ones working strategically. That’s what a sold out crowd heard at this year’s CRFA Trends Breakfast. The annual event, held at the 2013 BC Foodservice Expo, offers an industry update and forecast for restaurateurs, chefs and other professionals. <p.“It’s about understanding that consumer behaviour and their decision to eat out of home,” said Robert Carter, executive director of the NDP Group, who described the state of the Canadian foodservice marketplace as still “tumultuous”. <p.In his presentation, Carter discussed the overall state of the industry (nationally and in B.C.) and focused on five key strategic trends that will drive opportunities in the marketplace. According to Carter, a number of different areas are competing for that foodservice dollar such as debt, taxes, housing and transportation. Increased competition in the industry over the last few years is another one. The number of commercial restaurant units across Canada has grown at a 12 per cent rate while consumer spending on food has increased only marginally.
“There will be intense competition. Operators will need to continue to look for that key point of difference to steal share from competitors,” he said, adding the industry also needs to focus on taking some of that consumer spending away from other key categories such as grocery. NPD forecasts Canadians spending $155 billion on food in 2013. The majority of that spending will be in the grocery category (70 per cent) with the remainder in restaurant visits (30 per cent).
The full service dining segment has faced the most challenges in the last couple of years and “traffic is still underperforming,” according to Carter. “When we look at traffic right across Canada, B.C. continues to lag the rest of the country.”
However, what is driving traffic in the B.C. market is the morning meal. Lunch and supper remain challenging not only in B.C. but across the country.
Carter advised despite some positives, strong growth is not expected in 2013 so those who will be successful need to focus on five key strategic trends:
- The Educated Foodservice Consumer
- Pricing
- Menu Innovations
- Customer Experience Convenience.
“The most influential trend is the educated consumer,” he explained. “The consumer we’re dealing with today is much different than the consumer five, sevent,10 years ago…much more connected, much more access to information and that’s influencing the way that they use restaurants overall.”
Today’s consumer is willing to learn and seek out information to understand about the food and where it comes from. So what does that mean for the foodservice industry? “It really changes our go-to market strategies…presents a number of key areas of opportunity both in food innovation, communication as well as customer relations overall,” said Carter, citing the need for transparency (eg. nutritional labelling) as part of that strategy.
The second trend is price optimization. Understanding the price point of menu items presents a strong opportunity to increase dollars overall. “Customizing price to today’s customer presents opportunities to grow dollars and that’s especially important for B.C. considering you have the highest average eater cheque in the industry across Canada,” said Carter.
Giving consumers a reason to go out of home – to restaurants is another key to driving traffic. Menu innovation is one way to do that.
“This trend will continue to grow in 2013 as more operators focus on LTOs to expand into different day parts,” said Carter. “Consumers are looking for greater variety, more flavour profiles and are inspired by menu innovations.”
NPD expects lunch traffic to start to grow in 2013, driven by more menu innovation in the LTO category. Lunch traffic has seen no traffic growth since 2007.
“Giving consumers a reason to come in is only half the battle,” advised Carter. “Once they are in the door, it’s about delivering that customer experience.”
Customer experience is not just about service. It’s also about atmosphere, price, food and overall value, explained Carter. Each of these need to be monitored because they are key factors that drive the greatest revisit intent (ie customers returning).
Finally, convenience is another important and influential trend in the marketplace today both from a grocery standpoint as well as a foodservice standpoint.
“We expect this convenience trend to continue. Today 57 per cent of all restaurant meals are consumed off premised. A lot of that is driven by the fact that we’re time strapped as Canadians overall,” said Carter.
He also cited that 75 per cent of all meals in home are prepared in 15 minutes or less which is driving trends like home meal replacement. Home meal replacement has seen double digit growth in the last couple of years. Snacking and drive thru have also seen dramatic growth.
Carter concluded the presentation by saying,”These five trends will have more focus in 2013. These trends have been driving successful operators in 2011 and 2012.”
Proceeds from this year’s breakfast will go to Culinary Team Canada to help members compete at the Salon Culinaire Mondial in Switzerland.