8 trends that shaped the restaurant industry this year
Read on for a look at the burger wars, no-tipping tests and sales slumps 2016 ushered in.
1. All-day everything
Dayparts continued to blur this year, spurred by diners’ growing preferences for portability as well as flexibility.
McDonald’s expanded its all-day breakfast offerings, restaurants added more egg-based dishes at lunch and others touted the fact that they offer their full menu all day (including, say, hamburgers at breakfast).
2. Meal deals make waves
Discounting took new form in 2016, jumpstarted by the so-called burger wars—a battle in which many big-time chains (and a few smaller ones) sought to undercut competitors with the latest and greatest deal beyond the dollar menu. Pizza Hut, Burger King, Sonic, Dairy Queen and Starbucks are just a few of the brands that jumped on the meal deal train, hoping for a slice of the sales boost.
3. Summer sales slump
Sales took a dive at several chains in early summer, spawning a slew of theories about the cause of the slowdown—which ranged from the pending election to the proliferation of meal kits. Overall industry softness hit casual-dining spots particularly hard, and predicated a rash of fall bankruptcy filings from such well-known brands as Logan’s Roadhouse and Fox & Hound.
Pizza chains, however, received a notable reprieve, as delivery-heavy brands like Domino’s saw strong sales growth.
*A previous version of this story incorrectly listed Ruby Tuesday as a chain that had filed for bankruptcy this year.
4. Food safety concerns continue
While Chipotle failed to shake off the lingering effects of last year’s food safety crises, consumers continued to expect (and demand) menu transparency across the industry. Meanwhile, foodborne illness remained top of mind, as imported strawberries sickened patrons of Tropical Smoothie Cafe, Pizza Ranch experienced an E.coli outbreak spanning seven states and Buffalo Wild Wings had 10 patrons fall ill from norovirus.
5. Food halls go full steam
Food halls have continued to rise in profile, with the opening this year of such upscale entries as Revival in Chicago and R. House in Baltimore. Others are popping up in unusual places, including New York City’s TurnStyle, which squeezes 30 vendors into a subway tunnel.
6. Gaming grows...
In late summer, Pokemon Go took the industry by storm, as restaurants and bars nationwide sought to capitalize on the gaming craze through promotions, special events and other means.
Additionally, brands aimed to bolster their mobile apps with in-app games that boost engagement and drive customers in-store with points toward free menu items.
7. ...as do labor worries
Tip or no tip was the question on many restaurateurs’ minds when 2016 began, as industry magnate Danny Meyer announced his hospitality group would do away with the customary practice, opting instead for set staff wages offset by higher menu prices. Some brands that followed suit pulled back on no tipping shortly after, while others have kept it up.
Complicating labor concerns, especially for concepts with many midlevel managers, the U.S. Department of Labor announced new overtime rules that would require salaried employees making less than $47,476 to receive overtime—almost double the current salary for overtime eligibility. Enforcement of those rules, which were slated to take effect on Dec. 1, has since been delayed.
8. Enter the robot era
Some chains are answering labor concerns with automation, as Wendy’s president noted plans to supplant some workers with self-service kiosks, and McDonald’s announced it would soon employ some form of kiosk ordering at all of its U.S. units.
In addition, a handful of QSR brands leaned into artificial intelligence, launching chatbots as part of their ordering platforms.