Reinvention Needed as the Playing Field for Foodservice Operators Is Changing

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Reinvention Needed as the Playing Field for Foodservice Operators Is Changing

Millennial diners

CHICAGO — The NPD Group's new Eating Patterns in America report points to several factors that are changing the playing field for food companies and foodservice operators, including: shifting consumer attitudes, behaviors and demographics; an evolving marketplace with ongoing channel and digital disruptions; and increasing competition for consumer mindshare and dollars. 

Key shifts are occurring in how consumers shop, define convenience, use restaurants and foodservice outlets, and personalize health and wellness.

"Consumer eating attitudes and behaviors are evolving in ways that transform long-standing consumption patterns. Shifting demographics, changing meal composition, more fresh foods, and new attitudes on beverages all create challenges for growth," said David Portalatin, NPD's vice president, industry analyst and author of the report. "Today's macro environment isn't generating organic growth for the food and foodservice sectors, so we're dealing with a 1-percent world."

Along with changing their consumption patterns, consumers are making fewer visits to restaurants. Instead, they are opting to stay at home, or spending their money on experiences and other options. Accordingly, restaurant visits have declined for several quarters. The growth of foodservice delivery is evidence of the country's stay-at-home culture, as well.

The attitudes and behaviors of the two largest generational groups, baby boomers and millennials, are among the top factors contributing to the shifts in consumption. Millennials have surpassed boomers in total numbers, but boomers remain a large population whose behaviors still have a significant influence on the marketplace.

As boomers age, they use restaurants less, and this cutback has resulted in 292 million fewer restaurant visits per year, NPD found.

As boomers were before them, millennials, who are affected as a generation by sizeable student debt and other committed expenses, are acting as agents of marketplace change as they move through the stages of life. They continue to influence Big Food and the restaurant industries with their desire for authenticity, freshness and social consciousness.

"Although the food and foodservice industries are in a stalled growth mode, there are still pockets of growth," Portalatin said. "To grow in these challenged markets will require renovation by some, reinvention by others and, by many, a deeper understanding of what consumers really need and want."

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