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Foodservice Customers Increasingly Dine Out on Deals

Lingering inflationary concerns may be driving consumers to seek out bargains.

CHICAGO — Customer visits to restaurants and retail foodservice outlets who took advantage of a deal rose by 8 percent in the first quarter of 2023 compared to a year ago, according to a new report from Circana.

[Read more: Food & Beverage Spending Drive Retail Sales Revenue]

Lingering inflation and higher food prices may have motivated foodservice consumers to look for better deals. The subsequent increase helped to grow total commercial foodservice visits by 1 percent over a year ago, a traffic gain after four consecutive quarters of flat or declining growth.   

"Last year, deal traffic was flat as rising costs deterred operators from offering deals, and the deals offered weren’t [valuable] from a consumer perspective," said David Portalatin, Circana food industry advisor. "Although inflation is now moderating, food prices are up seven percent from a year ago, and consumers are looking for deals that will offset higher prices. Operators are using deals to drive more traffic."

Although 73 percent of all foodservice visits are not on a deal, those visits were flat in the same quarter. Buy some, get some and coupon deals were among the most popular deal types, growing 13 percent and 18 percent, respectively, while discounted price deals increased by 8 percent and daily specials by 6 percent. Combined item specials declined.  

Eighty-four percent of these deals were used at quick service restaurants (QSRs), corresponding with the fact that QSR visits represent most of the total foodservice traffic. Overall QSR visits increased by 2 percent over last year, while full service restaurant traffic declined by 1 percent in the period. However, visits on a deal were up by 4 percent, reported Circana.

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Loyalty programs were also a source of deals traffic during the quarter. Loyalty rewards and points redeemed at restaurants during the first quarter increased by 26 percent compared to the same quarter a year ago. Breakfast and morning snack periods appeared to be the most popular dayparts for loyalty points and reward redemption, which aligns with earlier findings that the segment has fully recovered from pandemic losses. 

Chicago-based Circana serves as an advisor on the complexity of consumer behavior. Through advanced analytics, cross-industry data and subject matter expertise, Circana provides insights and research that helps clients unlock business growth.

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