Targeting Less-Frequent Customers
Floriole Cafe and Bakery became an instant hit in Chicago by featuring "wholesome" sweets.
Getting less-frequent customers to shop and dine more often at bakeries, cafes and restaurants may seem like an obvious strategy, in terms of boosting sluggish US foodservice traffic growth. The lingering question is how to accomplish this task.
If half of all light users made one more visit per year, it would be an incremental increase in sales of $1.1 billion, according to the NPD report.
The majority of consumers (75 percent) who have decreased their restaurants visits say they watch how they spend their money on most or all purchases, and a high percentage of these respondents think that restaurant prices are too high, according to the NPD report, “Losing Our Appetites for Restaurants.”
Of the consumers who have cut back on restaurant visits the most are heavy restaurant users, who typically visit restaurants three or more times per week.
Heavy restaurant users are the perceived low-hanging fruit for many food operators and the target for promotional efforts. This user group’s visit cutback was a major factor in foodservice traffic growth coming to a halt, according to NPD.
Although they may not visit often, NPD finds that super-light and light users, who typically visit one time per week, and super-light users, who visit less than one time a week, are extremely valuable customers. Combined, these two groups account for 47 percent of all restaurant customers in a year, and they spend more per visit than heavy users.
If half of light users made just one more restaurant visit each year, NPD calculated that there would be an incremental sales increase of $1.1 billion. These users told NPD that regular discounts and, more importantly, discounts of their choosing would entice them to visit more.
“Many restaurant operators have spent much of their resources and time in rewarding heavy buyers,” says Bonnie Riggs, restaurant industry analyst at NPD and author of the report. “It’s important to continue recognizing heavy buyers, but to grow their business operators need to increase visit frequency from all user groups, including light and super light users.”
Targeting wholesome lifestyles
One key way to appeal to light and super light users is to offer menus that offer more options, such as wholesome bakery products.
“Consumer attitudes toward health today have evolved beyond diet, exercise, and the specific attributes (presence or absence) of food items,” says Darren Seifer, NPD Group’s food and beverage industry analyst. “Now they’re looking for personal plans that meet their own specific interests, and more importantly, their lifestyles.”
Exercise, for example, is not necessarily increasing as part of the new health and wellness lifestyle, nor are consumers typically losing weight, but from the active wear worn to the foods consumed, consumers are embracing a lifestyle centered on wellness. They’re wearing fitness trackers, athleisure apparel, and athletic footwear. In many cases they’re interest in these items is as much as looking the part of an active lifestyle as it is actually having one.
From an eating behavior standpoint, this lifestyle is about eating “wholesome” food, such as fresh, organic, or non-genetically modified items, according to NPD Group. Concern for and avoidance of traditional health-related attributes, like fat or cholesterol, is waning, although sugar is still a concern.
Carrying a banner for this movement in the bakery café sector, Panera Bread Co. has now achieved a “no no list” goal first announced in May 2015 as its entire US food menu and portfolio of Panera at Home products are now free from all artificial flavors, preservatives, sweeteners and colors from artificial sources, the company announced in January.
To achieve its goal, Panera reviewed more than 450 ingredients, delving several levels into the supply chain. The company reformulated 122 ingredients, resulting in changes to the majority of Panera’s bakery-cafe recipes. The company partnered with more than 300 food vendors to achieve the goal.
“At Panera, we want to serve food we want our own families to enjoy,” said Ron Shaich, founder and chief executive officer of St. Louis-based Panera Bread. “Offering a clean menu free from all artificial flavors, preservatives, sweeteners and colors from artificial sources is one way we can help our guests feel confident about the food they eat at Panera.”
Panera Bread first published the “no no list” on May 5, 2015, saying more than 150 ingredients would be impacted. Some of the most difficult challenges came in deli meats, bacon and select bakery items, given the ubiquity of additives in these categories.
“This initiative required us to restock the pantry with 100% clean ingredients,” said Sara Burnett, director of wellness for Panera Bread. “We are proud of accomplishing this feat, but we are even more proud of the potential impact we can have on the broader food industry. We continue to challenge our peers to make a comprehensive commitment to 100% clean ingredients.”
Other trends to watch
In addition to health and wellness, NPD Group’s Seifer points out other trends gathering steam.
It's the little things grabbing consumers’ attention these days; they can be small but influential ways to garner loyalty among consumers. Increasingly consumers are looking to support brands and companies that do more than manufacture a product —they want to support causes and actions aligned with their values. People feel they’re doing right when they support companies that are connected to locally sourced ingredients, donations to charities, sustainable environmental practices, and animal welfare practices.
Technology is quickly making its way into how consumers acquire foods and beverages because it saves time. Although the use of technology is currently a small behavior, NPD Group expects to see more people in the coming years use retailers’ websites or third-party sites like InstaCart to acquire foods and beverages.
It’s becoming more common to make meals at home while also using dishes sourced from restaurants. Those purchased components are more likely to be appetizers or side dishes, indicating consumers use these dishes as quick ways to round out or complete their meals. It’s yet another sign people want freshly prepared items in the home without having to spend a great deal of time in the kitchen. This is a true generational shift; younger consumers already consume fresh foods at rates higher than older adults did when they were the same age. As these younger consumers age, NPD’s forecast shows their demand for freshness in a hurry will only increase.