Inflation presents a challenge for restaurant marketing as prices continue to rise. In March, inflation hit new record highs, climbing to 8.5% (the biggest 12-month increase since December 1981). During this period, inflation for restaurants was at 6.9%, while Grocery was at 10.0%. Gasoline is the highest inflationary increase consumers face at 48.0%.
Price increases in two essential categories, gas and groceries, put significant pressure on consumer’s wallets, but it actually presents an opportunity for restaurants. Restaurants have a cost advantage over grocery, because the rate of inflation is rising slower for restaurants, as seen in this chart of inflation rates by month :
When the gap widens and the rate of inflation for restaurants is lower than for groceries, restaurants typically see a rise in traffic and sales as household budget managers determine, “It is cheaper to eat out!” This gap further widened in March 2022 by 3.1 percentage points.
The window of opportunity is open for restaurant operators to aggressively target grocery consumers while they maintain the current cost advantage.
Pressure on Consumer Wallets Creates Opportunity to Grow Share
With inflation hitting wallets hard, consumers are checking prices more closely than ever; 52% want more deals and value. Price is becoming a focus for consumers as they seek ways to save money while maintaining activities such as eating out, which has been suppressed for the past two years.
- Consumers are seeking great value, not just discounts.
- Brand loyalty is trumped by perceived value.
- Staying top-of-mind protects high-value customers and strengthens loyalty.
- Reaching customers with the value they want most drives frequency.
Coupons are a top influencer of consumers’ dining out decisions, influencing nearly one-third of consumers. That’s higher than internet advertising (23%), direct mail (17%), email (14%) and social media (14%), and it spans nearly every restaurant category, including fast casual, pizza, and QSR.
Restaurant Marketing: Coordinated Media Drives Results
Integrating your creative message and media flights ensures that consumers are exposed to one consistent message which strengthens overall campaign delivery.
- Identify your best customers, then target lookalike households and devices.
- Deliver targeted messages via coordinated, high-attention print and efficient digital display.
- Optimize campaign delivery using real-time data.
- Adjust media delivery to reach your highest performing online and offline consumers.
How to Best Manage Audience Attention, Engagement & Loyalty
Through our coordinated media campaigns, Mspark reaches the best consumers in your trade area, using several targeting strategies, including:
- Capture new consumers with low restaurant brand loyalty.
- Re-engage your lapsed customers.
- Use mobile tracking technology to target new consumers who drive by your restaurant.
- Identify competitor vulnerabilities to efficiently steal share.
We deliver brand value where, when, and how your consumers want it! Download our Restaurant Marketing eBook, and connect with us today to chat with an expert about your specific needs and goals.
Sources: Source: Bureau of Labor Statistics, March 2022 CPI Report; Prosper Insights & Analytics Monthly Consumer Survey