The economic downturn has made it harder for Americans to spend money on dining out—and that’s been particularly true for families. “We’ve seen restaurant spending down across all demographic groups,” says Joan Holleran, director of research at Mintel.
The economic downturn has made it harder for Americans to spend money on dining out—and that’s been particularly true for families. “We’ve seen restaurant spending down across all demographic groups,” says Joan Holleran, director of research at Mintel. “Even two-income families are holding on a little tighter to purse strings due to economic uncertainty. They might be dining out less, or eating at less expensive restaurants in an effort to stretch their dollars a bit further.”
Chicago market research firm Technomic recently asked mothers of children aged six to 12 how their families’ eating behavior had changed at different restaurant types during the 12 months through July 2009. More than half of respondents (51 percent) reported that their families cut back on visits to or spending at fast casual restaurants. And the numbers are even worse at family style (52 percent cutback), casual dining (55 percent cutback) and fast food (59 percent cutback) restaurants.
Meanwhile, a Mintel report on family and midscale restaurants found that family restaurant revenues in the U.S. had dropped 1.3 percent in real terms since 2008 and 5.1 percent since 2005; the firm predicted a 3 percent decline in 2009. Another Mintel report on the industry includes this understated yet ominous verdict: “It is feasible that some family restaurant players will not survive the decade.”
Such findings aren’t encouraging. Still, this environment also offers opportunities for resourceful operators—especially those who understand the forces driving families’ restaurant spending.
For starters, there is the obvious fact that restaurants must appeal to increasingly budget-conscious families. “Value is crucial,” says Bridget Sutton, president of fresh Mexican concept Baja Sol, which has 19 units in Ohio, Minnesota and Illinois.
There’s also a second factor driving family spending: kids. Roughly one-in-four Americans are less than 18 years old, and that figure is rising. What’s more, the number of children aged six to 11 will grow rapidly during the next five years—and parents tend to enjoy dining out with kids in that age group, according to a recent Mintel survey, Kids’ and Teens’ Eating Habits. With that in mind, here are some ideas that might help you bring families into your restaurant:
Think value. Family Italian restaurant Vito’s Cafe in Cincinnati offers family-style dining on Sundays; families share large portions of a few entrees. Baja Sol has kids-eat-free days and reduced-price menu items. “Our customer count increases significantly when we offer those breaks,” says Sutton.
Jim Solomon, owner of The Fireplace in Brookline, Massachusetts, recently introduced “Humble Offerings”—comfort food for under $20 from Sunday through Thursday. That compares to typical entrée prices of $20 to $33. Solomon says the restaurant has seen a significant increase in sales to families since he made the change.
Have a strong kids’ menu.A kids’ menu tells parents that their children will have appealing choices, and that those choices will be relatively affordable. It also lets parents know that they won’t be the only ones bringing their noisy kids with them to the restaurant.
A recent Mintel survey found than 80 percent of children in the six-to-eight age group order their meals off the kids’ menu. The same goes for 45 percent of children in the 12-to-17 age group.
Kids’ menus are especially important for restaurants that serve specialized or exotic cuisines. Restaurants like P.F. Chang’s, which serve ethnically driven food and have no kids’ menu alternative for picky young eaters, are generally an unattractive choice for families dining out. The Mintel survey found that only 4 percent of children ate at P.F. Chang’s during that month.
Make sure that your kids’ menu includes some healthy choices. Adding healthy choices to the kids’ menu reassures parents who want to encourage healthy eating habits in their children. Serving healthier children’s dishes was the fourth most popular trend cited in a 2009 National Restaurant Association survey of 1,600 chefs. A straw in the wind: fast casual chain Bruegger’s recently started serving its grilled cheese and peanut butter sandwich kids’ items on whole-wheat bagels.
Find ways to appeal to clients with allergies and dietary restrictions. Bridget Sutton of Baja Sol notes that many parents ask for gluten-free menu options. “Our parents don’t care so much about things like organic or sustainable farming,” she adds. “They want to satisfy their children’s dietary needs without spending too much.”
Make teenagers welcome. The labor market for teens is shrinking, and parents have less money to spend on their kids’ allowances. Result: teenagers can’t afford to take themselves out to dinner as often as they once did. That means they’re more likely to stay home or eat out with their folks—which in turn makes them a more important factor in determining where families spend their dining-out dollars.
Teens need to feel that there is a coolness factor at your restaurant. Music and a friendly waitstaff make a big difference in how teenagers see your restaurant. With that in mind, some Baja Sol restaurants have interactive jukeboxes, while Vito’s Café offers a popular young-adult cocktail list (sample drinks: non-alcoholic Mud Slides and Strawberry Daiquiris).
Whatever you do, don’t give up on the family demographic. The Technomic report that described cutbacks in family dining also has this to say: “No matter what is going on with consumers due to economic or other troubles, they want to alter their lifestyles as little as possible. Restaurants … are a big part of consumers’ lives that they do not want to give up.”
In short, families want to eat out—but the parents need to make every dining out dollar count, and the kids want to have fun. Help them reach those goals, and you’ll be closer to reaching your own.