Industry News | January 24, 2014 | QSR Exclusive Brief

NPD: Consumer Habits Shouldn’t Stop Brand Innovation

Despite buzz around the industry surrounding Millennials’ desire for new and adventurous foods, a recent report from The NPD Group found that more than 70 percent of restaurant guests will not try a new menu item.

Analysts believe that percentage could be even higher for the quick-service industry.

“Casual-dining menus have a greater opportunity to provide descriptors of preparation, content, and some of the key triggers for trial on their menu, which you can’t really do at a quick-service restaurant,” says Warren Solochek, an NPD analyst. “There are times ... that descriptions are important or you have to make the product look appealing for somebody to try it, and you can do that much more easily on a menu that happens at a casual-dining restaurant than on menuboards that you see at a quick-service outlet.”

But Solochek says operators shouldn’t give up on new menu items. He says quick serves should still pursue limited-time offerings and new permanent dishes, adding that they are a must for quick-serve restaurants because they still demonstrate that the brand is innovative.

“They have to show the public that they are working on creating new and interesting things that people will like,” Solochek says. “It’s a way to differentiate from the competition.”

He says sales should not be the primary motivation behind introducing new products to the menu.

“Even if new products are advertised and those new products are not necessarily successful at a chain, it still gives the chains opportunities to advertise and get their brand name in front of the public so that the chains are a bit more top of mind,” Solochek says. “In today’s environment, there is so much advertising going on, and there is so much promotion going on. If you have something that you’re talking about via your advertising, it’s getting your name back out there again.”

When developing permanent and limited-time menu options, Solochek says, operators should strive for unique and creative offerings.

“If you introduce a product that has something distinctly different from the things that already exist on a menu or in the competitive set, that’s when the advertising is going to stand out, and that’s when people are going to be interested,” he says.

Such was the case for Wendy’s when it launched its Pretzel Bacon Cheeseburger. Solochek says the brand’s LTO burger was popular in stores and successfully garnered attention from the media and consumers.

But he says a promotional item does not have to be centered on a new taste. He says a new product or LTO can also be successful if it’s built around a new operational strategy, like portability or packaging.

“KFC these days is advertising chicken in a cup. The product in that cup isn’t particularly unique for what they have on their menu, but it’s the carrier, and the convenience is what they’re advertising,” Solochek says. “It’s got to be something that really is different to be successful.”

By Marlee Murphy