NPD Group finds growing light users’ frequency would result in an incremental sales increase of $1.1 billion.
While it might be tempting to focus on regular foodservice patrons, it turns out nudging the occasional foodservice patrons to return again could be the key to driving foodservice profits.
Getting customers who visit restaurants less to visit more may seem to be overstating the obvious in terms of boosting sluggish U.S. foodservice traffic growth. But it turns out that it’s not. If half of the light restaurant users made one more visit per year it would be an incremental increase in sales of $1.1 billion, finds a new report from The NPD Group, a global information company.
The report, which is based on NPD’s receipt mining service, Checkout Tracking, and its ongoing foodservice market research, examines the reasons why consumers have cut back on foodservice visits and which type of users — heavy, medium, light and super light —decreased their visits the most.
The majority of consumers (75%) who have decreased their restaurants visits say they watch how they spend their money on most or all purchases, and a high percentage of these respondents think that restaurant prices are too high, according to the NPD report, Losing Our Appetites for Restaurants. Of the consumers who have cut back on restaurant visits the most are heavy restaurant users, who typically visit restaurants three or more times per week. Heavy restaurant users are the perceived low-hanging fruit for many restaurant operators and the target for promotional efforts. This user group’s visit cutback was a major factor in foodservice traffic growth coming to a halt, said NPD.
Although they may not visit often, NPD finds that super-light and light users, who typically visit restaurants one time per week, and super-light users, who visit less than one time a week, are extremely valuable customers. Combined, these two groups account for 47% of all restaurant customers in a year, and they spend more per visit than heavy users. If half of light users made just one more restaurant visit each year, NPD calculated that there would be an incremental sales increase of $1.1 billion. These users told NPD that regular discounts and, more importantly, discounts of their choosing would entice them to visit more.
“Many restaurant operators have spent much of their resources and time in rewarding heavy buyers,” said Bonnie Riggs, restaurant industry analyst at NPD and author of the report. “It’s important to continue recognizing heavy buyers, but to grow their business operators need to increase visit frequency from all user groups, including light and super light users.”
