Technology key to delivering value to customers: NPD

In Canada, the foodservice
industry is expected to grow at a modest rate of less than one per cent
per year over the next five years, which means any growth will be
derived by stealing visits from the competition, said Robert Carter,
executive director of Canada Foodservice at The NPD Group, in a news release.

“There are going to be winners and losers in the restaurant industry
this coming year,” said Carter. “Restaurant operators who remain
relevant by giving consumers what they want can be the winners, but it
will require continually staying on top of trends and understanding what
is resonating most strongly with consumers.”

Convenience, value, unique menu items, and service remain high on the
list of foodservice consumers’ must-haves and wants, and that won’t
change in 2015, but the ways consumers define these are continually changing,
he said. For example, convenience is generally about portability,
time-savings, and order accuracy, but the recent unprecedented
technology revolution has raised the bar in all of these areas. Online
marketing is no longer a nice-to-have for restaurant operators: it’s a
necessity. This year will bring an increased proliferation of mobile
apps for ordering and payment, and other technologies that enable
greater convenience for restaurant customers.

The quick-service restaurant (QSR) segment in Canada, which currently
accounts for 4.3 billion annual consumer visits and generates $23
billion dollars a year, will grow only modestly over the next seven
years. QSR visits, which increased only one per cent over the past
several years, are also forecast to increase a little less than one per
cent per year from 2013 through 2020, based on NPD’s 2020 Vision: The Future of QSR report.
The slight traffic growth expected is driven by population increases
and not actual visits since per capita visits are forecast to decline.
Also contributing to the overall QSR traffic growth over the next
several years are off-premise QSR visits, mainly carry-out and
drive-thru, which are forecast to grow by 10 per cent versus on-premise
visits, which are expected to increase by only one per cent.

“The challenge over the next several years will be for quick-service
operators to incent their customers to eat on-premise,” Carter said. “QSR
operators must be prepared to deal with this continued shift towards
off-premise occasions by providing consumers with convenient, flexible
meal solutions throughout the day while focusing on fast/convenient
service.”

Both QSR and full-service restaurant operators will need to focus on
value this year. Value has been redefined by foodservice consumers and
it’s far more than price. Food quality remains the most important value
driver when choosing restaurants and should be viewed as a cost of
entry. Carter explained that in 2015 operators must also offer
more choices, such as portion size and right price; deliver on customization
and fresh ingredients; use different preparation styles; and focus on quality and service.

“A changing, complex marketplace sometimes requires peeling back the
layers and revisiting the basics,” he said. “The New Year surely
will bring more changes, but if operators go back to the basics of
understanding and focusing on customers, it will be a more successful
and prosperous year.”