Industry News | August 2, 2013
Consumers Think They Spend Less, But They're Wrong
In consumers’ minds, their spending habits—whether it’s on transportation, dining out, or alcohol—are under control. But according to recent research from consumer intelligence firm Mintel, they may not be doing as well as they think.
Though U.S. consumers claim they’re cutting back, they’re actually spending more this year across every consumer category—including dining out at quick-service restaurants.
One-third of consumers say they’re spending less on dining out this year compared to last year, though in reality, the Mintel research says diners are spending 6 percent more.
“Dining out is something Americans do love to do,” says Julia Gallo-Torres, category manager for U.S. foodservice reports and menu insights at Mintel. “It’s the first thing that they cut out, though, when they’re financially strained, and it’s the first thing they return to once those strains lessen.”
It appears many consumers don’t realize they’re spending more money on dining out, thanks largely, Gallo-Torres says, to the “treat” mindset.
“It’s little steps like, ‘I’ll just get myself a coffee,’” she says. “There’s also the treat mentality, where we’re seeing people want to indulge. They’re so restrained financially in other areas that eating out—no matter how small the spend is—is something that’s really attractive to them.”
Gallo-Torres says the coffee and smoothie segments have done especially well as of late due to the trend toward small indulgences at a low price.
“Sometimes people can just get away with having a shake or smoothie for lunch, so they don’t have to go ahead and spend on a full meal,” she says. “Maybe your family can’t afford to go out to dinner, but you can afford to go out to a coffeehouse or you can afford to go out to a smoothie shop.”
In addition, the fact that consumers are increasingly busy and always on the go means they’re willing to spend a little extra money for convenience’s sake.
“Between work and children and other activities, they still need relief from cooking,” Gallo-Torres says. “It doesn’t happen every night anymore, so they’re willing to go ahead and spend where they can and in a limited fashion if they have to.”
She says quick-serve and fast-casual brands have done well capitalizing on these consumer trends, particularly by highlighting promotions and limited-time offers to draw customer traffic and increase sales.
By Mary Avant
Food & Beverage