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Restaurant: Decision Making Process - US - August 2016

"Across demographics, the convenience of limited service restaurants still remains a strong motivator for weekday dining out, specifically with fast food. On the other end of the spectrum, Millennials are creating their own dining out culture across fine dining restaurants and fast casuals, with more shareable dishes and elevated alcohol offerings."

- Diana Kelter, Foodservice Analyst

This report will cover the following areas:

  • Fast casuals not competing with convenience and affordability of QSRs during the week
  • Portion sizes vary across the board
  • Consumers don’t want to feel rushed during their meal

The purpose of this Report is to analyze consumers’ attitudes, behaviors, and perceptions surrounding the restaurant decision making process. It will also examine how the restaurant decision making process varies across demographics, generations, regions, and by race.

For the purposes of this Report, Mintel has used the following restaurant definitions:

  • Quick service restaurants (QSRs) – Used interchangeably with “fast food,” QSRs specialize in inexpensive, convenient meals. There is no waiter service, no alcoholic beverages, and low price point. Examples include: McDonald’s, Kentucky Fried Chicken, Taco Bell, Wendy’s, and Pizza Hut.
  • Fast casual restaurants – These establishments are characterized by a higher price point than QSRs though not as high as full service restaurants. Fast casuals do not offer waiter service and may or may not serve alcohol. Examples include: Chipotle, Panera Bread, Shake Shack, and Blaze Pizza.
  • Limited service restaurants (LSRs) – These establishments provide food services where customers usually select and order items and pay before dining. Food/drink may be consumed on the premises, offered as carryout, or delivered to the customer’s location. These may also sell alcoholic beverages. LSRs include both QSRs and fast casual restaurants.
  • Full service restaurants (FSRs) – These establishments have waiter/waitress service in which customers order and are served while seated. These may also sell alcoholic beverages and offer carryout services and include the restaurant segments: midscale, casual dining, and fine dining.
  • Convenience stores (C-stores) – Convenience stores are establishments that retail a limited line of goods, primarily groceries and ready-to-consume beverages and snacks, in easily accessible locations. The majority of convenience stores also sell motor fuel.

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Table of contents

  1. Overview

    • What you need to know
      • Definition
      • Executive Summary

        • The issues
          • Fast casuals not competing with convenience and affordability of QSRs during the week
            • Figure 1: Segment visitation, by occasion, May 2016
          • Portion sizes vary across the board
            • Figure 2: Interest in various portion sizes, by generation
          • Consumers don’t want to feel rushed during their meal
            • Figure 3: Restaurant considerations, any occasion, May 2016
          • The opportunities
            • Restaurant industry projected for growth
              • Figure 4: Total US sales and fan chart forecast of full service and limited service restaurants and other eating places, at current prices, 2011-21
            • Dining solo
              • Figure 5: Importance of restaurant factors, comfortable for dining alone, by age, May 2016
            • Alcohol on the menu
              • Figure 6: Restaurant visitation factors, a great alcohol menu, by typical weekend, by generations, May 2016
            • Millennials less likely to associate fine dining solely with special occasions
              • Figure 7: Fine dining restaurant visitation, by typical weekend, by Millennials and non-Millennials, May 2016
            • What it means
            • The Market – What You Need to Know

              • Blurred lines between retail and foodservice
                • Alcohol sales important to FSRs
                  • LSRs offer convenience and quality
                  • Market Size and Forecast

                    • Restaurant sales reach $500 billion in 2016
                      • Figure 8: Total US sales and fan chart forecast of full service restaurants and limited service restaurants and other eating places at current prices, 2011-21
                      • Figure 9: Total US retail sales and forecast of full service restaurants and limited service restaurants and other eating places*, at current prices, 2011-21
                      • Figure 10: Total US retail sales and forecast of full service restaurants and limited service restaurants and other eating places*, at inflation-adjusted prices, 2011-21
                      • Figure 11: Total US retail sales of restaurants, by segment, at current prices, 2016
                  • Market Factors

                    • Dining out distinction becoming less clear cut
                      • Figure 12: Food sales away from home versus at home, January 2012-May 2016
                    • Consumer confidence
                      • Figure 13: Consumer Sentiment Index, June 2008-June 2016
                    • Alcohol and less-traditional meal occasions
                      • Figure 14: Total US sales and forecast of on-premise alcohol, at current prices, 2010-20
                    • Shifting US demographics driving market sales
                      • Figure 15: Population by generation, 2016
                    • Fast casuals have to consistently demonstrate their value
                    • Key Trends – What You Need to Know

                      • Happy hours and less traditional meal times
                        • Restaurants in retail settings
                          • Millennials and foodies always looking for something new
                          • What’s Working?

                            • Shareable plates
                              • Outdoor seating
                                • Pictures of food
                                  • Kid-friendly dining
                                  • What’s Struggling?

                                    • Traditional meals are starting to lose relevancy
                                      • Soft drinks are being replaced by more natural options
                                      • What’s Next?

                                        • Technology innovations improve customer experience
                                          • Innovation and design create a full restaurant experience
                                            • Restaurants gain appeal in nonfood retail settings
                                              • Restaurant collaboration and partnerships go mainstream
                                              • ePerformance Data

                                                • What is ePerformance?
                                                  • ePerformance and the foodservice industry
                                                    • Figure 16: Email volume, by restaurant segments, June 1-July 2016
                                                  • The importance of email marketing for the restaurant decision making process
                                                    • Restaurant analysis
                                                      • Chili’s leverages emojis
                                                        • Figure 17: Chili’s company email July 5, 2016: “+ salad + dessert = only $10!”
                                                      • Houlihan’s and pop culture
                                                        • Figure 18: Houlihan’s company email June 24, 2016: “Hello. Is it tiki you’re looking for?”
                                                      • Broader foodservice trends
                                                        • Figure 19: Applebee’s company email July 25, 2016 “[Name], every meal is better shared”
                                                      • Highlighting loyalty programs
                                                        • Figure 20: Chipotle company email July 1, 2016: “Did someone say FREE burrito? Chiptopia has begun.”
                                                    • The Consumer – What You Need to Know

                                                      • Comfortable dining alone
                                                        • Millennials want to share food
                                                          • Fine dining beyond special occasions
                                                          • Restaurant Segment Visitation

                                                            • Restaurant segment visitation by occasion
                                                              • Figure 21: Restaurant segment visitation, May 2016
                                                              • Figure 22: Restaurant segment visitation, by occasion, May 2016
                                                            • FSRs compete with LSRs for convenience
                                                              • Figure 23: FSR and LSR segment visitation, May 2016
                                                            • Restaurant visitation by parents versus nonparents
                                                              • Figure 24: Segment visitation on a typical weekday, by parents versus nonparents, May 2016
                                                            • Delivery by restaurant segment
                                                              • Figure 25: Importance of delivery for restaurant choice, by restaurant segment visitation, May 2016
                                                          • Restaurant Visitation Motivators

                                                            • Experience is all
                                                              • Figure 26: Restaurant considerations, any occasion, May 2016
                                                              • Figure 27: All restaurant considerations by occasion, by income, May 2016
                                                            • Outdoor seating by restaurant segment
                                                              • Figure 28: Restaurant considerations, by restaurant type, by any occasion, May 2016
                                                            • The rise of dietary-aware dishes and dining alone
                                                              • Figure 29: Important qualities for restaurant choice, May 2016
                                                              • Figure 30: Important restaurant considerations, comfortable for dining alone, by gender, May 2016
                                                          • Regional Attitudes

                                                            • LSRs vs. FSRs, by region
                                                              • Figure 31: Restaurant segment visitation, by region, May 2016
                                                              • Figure 32: Fast casual visitation, by region, May 2016
                                                            • Restaurant considerations, by region
                                                              • Figure 33: Importance of not feeling rushed during a meal on a typical weekend, by region, May 2016
                                                              • Figure 34: New restaurant visitation, by typical weekday, by region, May 2016
                                                          • Restaurant Decision Making Process by Generation

                                                            • Millennials find value in smaller, everyday indulgences
                                                              • Figure 35: Restaurant segment visitation, by generation, May 2016
                                                              • Figure 36: Restaurant segment visitation, by typical weekend, by generation, May 2016
                                                            • A strong interest in authentic, regional dishes across generations
                                                              • Figure 37: Appeal of authentic regional or international cuisine, by generation, May 2016
                                                            • Millennials and the bar scene
                                                              • Figure 38: Interest in a great alcoholic drink selection on a typical weekend, by generation, May 2016
                                                              • Figure 39: Importance of bar area, by generation, May 2016
                                                            • A convenient location for dining out
                                                              • Figure 40: Importance of convenient location, by generation, May 2016
                                                            • A sense of adventure surrounding Millennials
                                                              • Figure 41: Restaurant considerations, by special occasion, by generation, May 2016
                                                              • Figure 42: Restaurant considerations, by typical weekday, by generation, May 2016
                                                          • Restaurant Decision Making Process by Race

                                                            • Black consumers value convenient restaurant options
                                                              • Figure 43: Restaurant segment visitation, by race and Hispanic origin, May 2016
                                                              • Figure 44: LSR visitation, by race and Hispanic origin, May 2016
                                                              • Figure 45: Family restaurant visitation, by special occasion, by race and Hispanic origin, May 2016
                                                            • Menu appeal by race
                                                              • Figure 46: Menu characteristics appeal, by race and Hispanic origin, May 2016
                                                              • Figure 47: Restaurant considerations, by occasion, by race and Hispanic origin, May 2016
                                                            • Value deals by race
                                                              • Figure 48: Influencers for revisitation, by race, May 2016
                                                          • Motivators for Revisitation

                                                            • Seasonally inspired dishes grow in importance
                                                              • Figure 49: Influencers for revisitation, May 2016
                                                            • Coupons remain leading value offer
                                                              • Figure 50: Influencers for visitation, deal offers, May 2016
                                                            • Parents find value in dining out experiences
                                                              • Figure 51: Influencers for visitation, by parent versus nonparent, May 2016
                                                          • TURF Analysis – Menu Appeal

                                                              • Figure 52: TURF analysis, menu appeal, May 2016
                                                          • Appendix – Data Sources and Abbreviations

                                                            • Data sources
                                                              • Fan chart forecast
                                                                • Consumer survey data
                                                                  • Direct marketing creative
                                                                    • Abbreviations and terms
                                                                      • Abbreviations
                                                                        • Terms
                                                                        • Appendix – Market

                                                                            • Figure 53: Total US retail sales and forecast of limited service restaurants and other eating places*, at current prices, 2011-21
                                                                            • Figure 54: Total US retail sales and forecast of limited service restaurants and other eating places*, at inflation adjusted prices, 2011-21
                                                                            • Figure 55: Total US retail sales and forecast of full service restaurants, at current prices, 2011-21
                                                                            • Figure 56: Total US retail sales and forecast of full service restaurants at inflation adjusted prices, 2011-21
                                                                            • Figure 57: Population by race and Hispanic origin, 2016-21
                                                                        • Appendix – Consumer

                                                                            • Figure 58: Average household size, by race and Hispanic origin, 2015
                                                                        • Appendix – TURF Analysis

                                                                          • Methodology
                                                                            • Figure 59: Turf analysis, menu appeal, May 2016

                                                                        Companies Covered

                                                                        To learn more about the companies covered in this report please contact us.

                                                                        Restaurant: Decision Making Process - US - August 2016

                                                                        £3,277.28 (Excl.Tax)