The need for value: We’ve been hearing about it for a while as we ride out hiccups in the post-pandemic economy. The Bureau of Labor Statistics’ newly released Consumer Price Index shows that inflation has increased 5 percent year over year and food-away-from-home prices are 8.8 percent higher year over year. Consumers are leaning into value and watching their retail spending amid whispers of a recession coming in the second half of the year. Concern over the bank failures in March are likely adding some pressure on consumer spending too.
As a result, your efforts to infuse value through the experience you offer will continue to be important. The National Restaurant Association’s 2023 State of the Restaurant Industry report includes some tips to show guests you’re a smart-money pick. Consider fine-tuning your loyalty and reward program, which 80 percent of consumers say they would use for a nearby restaurant that they patronize.
Change up your portion sizes. Nearly three-quarters of adults say they would order smaller portions for a lower price if they were offered. (Of course, offering a larger size on the menu might incentivize guests to order more for their money too.)
Stabilize your restaurant’s traffic and cash flow while magnifying the value you offer. You might offer discounts to dine during off-peak hours and/or slower days of the week, or boost interest in dining at these times by offering limited-time promotions during these periods. On that note, more consumers are responding favorably to dynamic pricing on menu items too, so it may be worth experimenting with shifting prices in line with guest traffic and communicating transparently about price shifts via your app and social media.
Finally, if you have a loyal following, consider offering house accounts that allow guests to pre-pay your restaurant a set amount and get a bonus amount added to their account that they can use when they dine with you. The higher the pre-payment amount, the higher the bonus. Research has found this arrangement appeals across age demographics.