Why did Q3 restaurant visits decline for first time in 5 years?

shutterstock_316630853After 6 consecutive years of annual traffic gains restaurant industry traffic growth was flat for first half of 2016, but 3rd quarter results, led by quick serve restaurants [80% of total industry visits] came to standstill and are now experiencing a slowdown in visits. There are 3 main reasons driving these negative trends…

  1. Cost is the main reason.

– Things like rising health care costs and/or student debt means less disposable income so more consumers are keeping a watchful eye on how they spend their money.

  1. Restaurant prices are too high.

– Menu prices continue to rise; the average restaurant meal has increased 21% over the past decade.

  1. Price gap between groceries and dining out is widening.

– Grocery prices have dropped in many categories, including dairy; 82% of all meals are now consumed at home.

Best way for Hawaii restaurants to stay relevant in consumers’ minds and counter negative traffic trends?

– Competitive pricing and unique promotions

  1. Be aware of your competition to ensure your pricing on like items is comparable. Anyone can match or beat a promotional price, but a special offer that only you can deliver is often the best way to lead the pack, e.g. Enjoy a piece of our homemade Haupia Pie, free with any entree.

– Focus and promote enjoyable experience compared to eating at home

  1. Know your audience and be certain your advertising message and the vehicle you’re using to reach them, is on point. Examples:
  2. “Kids Eat Free on Tuesday” and “Family Style” may be the key to getting a young family to dine out instead of eating at home.
  3. Targeting millennials? Your method or ad vehicle is just as important as your message itself. They get their information on their phone, not from the daily newspaper.

– Quality and innovative products

  1. Simply stated, local and fresh is best, when we think about the foods we eat. . Both your menu descriptions and your advertising messages are good places to share your thoughts, e.g. “Nalo Greens”, “Big Island Grass Fed Beef”, “Farm to Table”, etc.
  2. We all love seeking out and trying the latest and greatest products, whether we’re talking about the newest iPhone or foodie craze. Gluten free, cage free, clean eating, are all “trigger” words and phrases that are now mainstream, and important to many of your customers.

    Doug Harris, CEO, HARRIS AGENCY



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