Despite Economy, Some Still Willing to Spend More for Premium
NEW YORK -- In its latest report about consumers' shifting meal preferences, foodservice consultants Technomic said while consumers are definitely spending less money dining out, many are still willing to spend more on "higher quality" menu items if they include premium ingredients, reported Progressive Grocer sister publication to Convenience Store News.
The findings revealed in the Consumer Pricing Strategy Report that more than six out of 10 consumers (61 percent), said they would spend more for a higher-quality sandwich if it contained premium meat; 41 percent if it were made with premium cheese; and 34 percent if it contained premium bread.
The report focuses on consumer and operator responses as the U.S. restaurant industry has been hit by a "perfect storm" of price pressures. It looks across income segments, meal day-parts and restaurant segments at consumers' attitudes toward and perceptions of menu price increases, and at how consumers expect their foodservice spending to change in the future, among other issues, Progressive Grocer reported.
Some of the consumer findings include:
-- Only 25 percent of consumers say that restaurants are increasing prices because they want to make more money; instead, three out of four attribute rising menu prices to increases in the cost of gasoline and ingredients.
-- The vast majority of consumers (91 percent) who are cutting back on restaurant spending say they are dining out less frequently. However, one-third (32 percent) are purchasing less expensive food when eating out, and one-fifth (19 percent) are ordering smaller amounts and portions.
Consumers realize that menu price increases are inevitable. However, the majority (56 percent) of consumers would prefer restaurants increase prices slowly over time to meet a specific price, rather than raising prices all at once, or by substantially increasing pricing on certain items, according to the report.
"Consumers are spending less on dining out and feel they have to allocate restaurant spending more wisely," said Darren Tristano, Technomic executive vice president. "Restaurant operators must offer a strong value equation to compete successfully for those dollars. Knowing when, how and how much to raise prices requires research into consumer intentions and behaviors as well as a close examination of industry practices."
For more information, visit www.foodpubs.com.
The findings revealed in the Consumer Pricing Strategy Report that more than six out of 10 consumers (61 percent), said they would spend more for a higher-quality sandwich if it contained premium meat; 41 percent if it were made with premium cheese; and 34 percent if it contained premium bread.
The report focuses on consumer and operator responses as the U.S. restaurant industry has been hit by a "perfect storm" of price pressures. It looks across income segments, meal day-parts and restaurant segments at consumers' attitudes toward and perceptions of menu price increases, and at how consumers expect their foodservice spending to change in the future, among other issues, Progressive Grocer reported.
Some of the consumer findings include:
-- Only 25 percent of consumers say that restaurants are increasing prices because they want to make more money; instead, three out of four attribute rising menu prices to increases in the cost of gasoline and ingredients.
-- The vast majority of consumers (91 percent) who are cutting back on restaurant spending say they are dining out less frequently. However, one-third (32 percent) are purchasing less expensive food when eating out, and one-fifth (19 percent) are ordering smaller amounts and portions.
Consumers realize that menu price increases are inevitable. However, the majority (56 percent) of consumers would prefer restaurants increase prices slowly over time to meet a specific price, rather than raising prices all at once, or by substantially increasing pricing on certain items, according to the report.
"Consumers are spending less on dining out and feel they have to allocate restaurant spending more wisely," said Darren Tristano, Technomic executive vice president. "Restaurant operators must offer a strong value equation to compete successfully for those dollars. Knowing when, how and how much to raise prices requires research into consumer intentions and behaviors as well as a close examination of industry practices."
For more information, visit www.foodpubs.com.