Foodservice Fact Check: What 2012 Can Teach Us About 2013

NPD reveals Canadian industry trends and tips for success as the year unfolds

TORONTO, February 20, 2013 – Though foodservice traffic is showing a two-per-cent growth, data obtained last quarter points to signs of softening in the industry, according to foodservice market research by The NPD Group, a global research company.  Although restaurateurs can seek comfort in knowing that dollar growth remains strong at four per cent, they should be conscious that traffic in Q4 2012 was flat versus the same period last year, and that strategic action is needed in order to thrive.

All dining segments (with the exception of the casual sector) are contributing to the last quarter’s zero-per-cent traffic increase, reports NPD’s CREST® research, which continually tracks consumer use of restaurants. Quick-service restaurants (QSRs), which account for 65 per cent of all commercial restaurant traffic, only grew by one per cent in 2012 and the slow pace of global economic growth is expected to yield similar results this year.

“The challenges the foodservice industry is experiencing are a definite reflection of consumer confidence, which remains tepid as the concern about global economic conditions lingers,” said Robert Carter, executive director of Foodservice at The NPD Group. “Though there are still hurdles to overcome in traffic growth, dollar sales indicate that Canadians are still eager to dine out if they feel that the return on their investment is worthwhile.”

In order to help restaurateurs better serve their consumers, Carter has identified five trends currently taking place in the foodservice industry and offers tips to profit from each one:

Trend #1: Consumers are more educated than ever

From sharing photos of each course to writing real-time reviews, today’s consumers are flooded with information from a seemingly infinite number of sources. In a world where engagement occurs around the clock, consumers are not just willing, but also able to learn everything there is to know about their food and their restaurants.

Tips: Consumers eat with their eyes, so using appealing descriptions and including vivid pictures are the most influential ways to drive orders. Information and images that can be easily obtained and shared will work to a restaurant’s advantage, and will also allow diners to satisfy their increasing need for knowledge.

Trend #2: Optimal pricing is taking centre stage

Informed decision making is at the root of every company’s success and, as the marketplace evolves, restaurants must rely on deep business insights for sustained growth. Smart pricing depends on examining behavioural and attitudinal trends, and understanding that the role of perceived value is the most straightforward method of determining optimal price points.

Tips: Know your consumers and their path to purchase. As price is only one component of perceived value, companies will need to use more than their instincts to succeed. Premium offerings are just as important as value offerings, so an educated decision is necessary to decide what pricing will yield the best results.

Trend #3: Limited-time menu offerings equal long-term successes

Variety is the spice of life and hungry consumers are indeed looking for it. For example, 70 per cent of full-service restaurant (FSR) visitors reported that they would like to see more menu options, and limited-time offers are a great way to garner new interest in a familiar establishment.

Tips: Restaurant owners need to focus on menu innovation to give consumers more reasons to dine out in 2013, and should look particularly at their existing lunch menus. Items like fries, soup, deli meats and soft drinks underperformed last year, so companies should appeal to short-term trends that will help to guide long-term diversification.

Trend #4: Diners want an “experience”, not a meal

Today’s consumers are willing to whip up a meal at home, so when dining out they are looking for more than simply food on a plate. Convenience, loyalty, food quality/variety, price/value and health are the main drivers for dining out in both QSRs and FSRs, and should always be top of mind with companies aiming to provide an experience that cannot be easily recreated at home.

Tips: The foodservice market is flat and very aggressive. Operators will need to compete vigourously to maintain their current clientele and steal share to gain business in a limited customer pool. Strategic planning will need to put service, atmosphere, value, price and food at the forefront in order to drive new business and to ensure that existing consumers come back for more.

Trend #5: Convenience is key

In a world of long work hours and over-scheduled social lives, more and more people are looking for a meal that takes little effort and that can be acquired without difficulty. Though women are working more, they have not ceded control of food preparation and still make 78 per cent of meals. As a result, grabbing a quick snack has become the go-to strategy of busy consumers.

Tips: Restaurant operators need to acknowledge that Canadians are now eating more meals than they have in the past and should capitalize on the growing snacking trend. Snacking is up 11 per cent from last year and now represents one third of restaurant visits, so consumers are looking for the best grab-and-go options that they can easily eat on their own schedules.


This data has been compiled from the following studies from The NPD Group:

Study Name Overview
ReCount® Comprehensive directory of restaurant locations
CREST® The who, what, when, where of foodservice
CREST® Customer Satisfaction The why behind the buy
Full Service Dining: How to Win Customers Back A comprehensive source for in-depth insight on casual and family/midscale restaurant consumers in Canada
Analytic Solutions Addressing your most complex issues, from forecasting to pricing, with custom research and advanced analysis
Eating Patterns in Canada (EPIC) The definitive source for information on Canadians' eating and drinking habits
National Eating Trends® (NET®) The best view of what Canadians are eating so you can make informed business decisions
SnackTrack® Focused on snack and convenience food consumption in Canada

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Kim McLynn


The NPD Group, Inc.
900 West Shore Road
Port Washington, NY 11050

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