Tags: fast | casual | dining | restaurants

'Fast Casual' Restaurants Top the Menu of Dining Options for Many Consumers

By    |   Tuesday, 18 Feb 2014 01:04 PM

Hot “fast casual” restaurants such as Chipotle Mexican Grill and Panera Bread are steamrolling the competition in restaurant segment’s growth. Consumers are still looking for a hot, fast meal, but they aren’t finding it in the “casual dining” or “fast food” segments.

Diners are setting their sites on fast casual establishments and turning their backs on the traditional outlets like McDonald's (quick service) or Red Lobster (casual dining).

According to a new study from the NPD Group, a global market research company, diner visits to fast casual restaurants were up eight percent in the fiscal year ending in November 2013, whereas fast food chains experienced no growth at all.

Editor’s Note: 38 Trades That Could Turn $1,000 Into $49,000

Consumer visits were down at full-service restaurants in the "midscale" and "casual" dining categories representing a one to two percent decline for the year. Recent reports show industry giants such as Red Lobster, Ruby Tuesday and related sit-down chains are struggling and the numbers speak for themselves.

The fast casual restaurant segment’s growing popularity has kept other restaurants on their toes, trying to create solutions to keep diners in their restaurants. Unfortunately, their efforts have remained unsuccessful as diners are diverting to fast casual nonetheless.

Chains such as Smashburger and Five Guys have risen to the occasion by trying to mirror the strategies of the fast casual chains. Menus have expanded to include “better burgers” that claim to live up to their heftier price tags by being bigger and better, Time reported. KFC and Taco Bell have delved into alternative fares and remolded interiors to attract more customers.

Applebee’s and Chili’s have attempted to improve speed and efficiency, rolling out new innovations such as “Express Lunch.” Even Wendy’s has made attempts to convert itself into a fast casual chain offering fast food prices in a casual dining atmosphere.

Whether it was Wendy’s introduction of the Pretzel Bacon Cheeseburger or its new business model, the chain had a positive year in 2013.

The fast casual dining segment is on to something and it is remaining steadfast. Consumers are spending their dollars on higher quality, healthier food options and forgoing the sit-down, wait staff experience that is found in full-service restaurants. Fast food chains may be suggesting a better burger, but at a higher price, diners aren’t buying the "better burger" concept as in most chains, it’s still a frozen patty.

Consumer spending rose 10 percent at fast casual restaurants last year, versus a two percent increase in overall spending in restaurants according to the NPD Group study.

Growth “far surpassed that of every other restaurant segment” in terms of customer visits and money spent for the fifth consecutive year in 2013 as noted in the industry publication Nation's Restaurant News.

NPD restaurant analyst Bonnie Riggs told the Huffington Post, "overall, restaurant customers are trading down, foregoing some of their visits to full service places while increasing the number of visits made to fast casual restaurants."

Editor’s Note: 38 Trades That Could Turn $1,000 Into $49,000

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Hot "fast casual" restaurants such as Chipotle and Panera Bread are steamrolling the competition in restaurant segment's growth. Consumers are still looking for a hot, fast meal, but they aren't finding it in the "casual dining" or "fast food" segments.
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2014-04-18
Tuesday, 18 Feb 2014 01:04 PM
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