The Research & Insights team at Basis Technologies has released their vertical knowledge brief on QSR. VKBs are a proactive deliverable we send monthly, and usually provide a deep dive analysis into Basis’ top verticals to highlight current trends, paid media implications, and top audiences driving growth.
Highlights from the QSR include:
- Industry Trends:
- The limited-service restaurant industry will grow by 8.9% this year. While consumers are cutting back on dining and unnecessary spending due to the current state of the economy, the fast-food market has remained relatively stable this year. Of all types of restaurants, fast-food restaurants see the most frequent visitation by Americans, followed by casual dining spots, and then fast casual.
- When it comes to dining out, consumers highly value convenience. Whether they’re visiting a fast-food establishment or a casual dining restaurant, consumers want quick service at a reasonable price. In the QSR space there has been an increased focus on technology to help streamline efficiency, which many consumers appreciate, but at the end of the day the value they’re getting for the price they’re paying is more important to them.
- Those who frequent QSRs are most likely to be a member of a loyalty/rewards program. Consumers like to feel valued and want to earn on the purchases they make, generating a sense of loyalty between a customer and a brand. However, QSR consumers are most motivated by value meals, daily deals, healthy options, and fast service. Trends happening in the QSR space right now include healthier food options, snackable options, regional/international flavors, and the ability to customize.
- Paid Media Implications:
- The QSR industry is an extremely high spending sector with an investment surpassing $3.5 billion between July 2023 and June 2024. The industry generally skews toward traditional channels; however, this fluctuates slightly throughout the year. QSR ad spending from this time-period was slightly down from the previous year but fast casual ad spending grew by 22%.
- Top spending QSR advertisers include large chains like McDonald’s, Wendy’s, Burger King, Taco Bell, and Subway. Top spending fast casual chains are brands like Applebee’s and Buffalo Wild Wings. These advertisers utilize a mix of digital and traditional channels, investing most heavily in TV. Prepared food delivery was the only category analyzed to spend more on digital than traditional.
- Creative messaging among the top QSR advertisers fit into consistent themes. Many QSR brands are emphasizing deals and promotions/value meals, exciting menu options, convenience, and quality of food. With many consumers being price-conscious, brands are focusing on ways to appeal to these types of fast-food eaters and generate long-term loyalty.
- Audience Insights:
- Casual diners tend to skew older while younger consumers are more likely to visit QSRs or fast casual restaurants. Casual diners enjoy spending time with family and friends over a meal, celebrating occasions at restaurants, and having a wide variety of options to choose from. QSR and fast casual consumers are more concerned about cost and efficiency. However, price is top-of-mind for most consumers looking to dine out, order takeout, or get food delivered.
- While price remains the biggest concern among diners, all these audience segments also value the convenience and efficiency that technology can provide. Online or mobile ordering, the availability of kiosks, and other innovations in technology are valuable to consumers that are busy and on-the-go. Restaurants that effectively integrate technology while keeping costs down will attract and retain more customers.
- All five audience segments analyzed spend at least 29 hours a week online, and brands have an opportunity to connect with them through digital channels. Looking to the future, brands should establish a stronger online presence to capture the attention of potential new dining segments. Brands will need to consider leveraging emerging media channels to stay relevant.
Check out the VKB here.
