Casual Dining's value pricing dilemma and how to regain momentum

Posted by Maeve Webster, Senior Director, Datassential June 24, 2013

Tagged in Foodservice Industry Research Foodservice Operators Industry Research Optimize

Maeve Webster HeadshotMaeve Webster, a senior director at Datassential, is a lead consultant for foodservice manufacturers, operators, and distributors. She has spearheaded more than 300 major industry studies during her 12 years as a foodservice specialist, and today designs and manages both consumer and operator-based studies in Datassential's strategic research group.


When the recession hit at the end of 2007 and customers opted to scale back their dining spending, all industry segments were forced to switch marketing gears in an attempt to lure newly-frugal patrons into their restaurants. QSRs typically focused on cost-based marketing, while Fast Casual created value-based combos or bundles that emphasized quality, freshness, seasonality, health, and unique offerings.

Casual Dining, long known as the leader in these qualities, opted to take the QSR approach and focused on price. Many casual chains added prix-fixe menus at lower price points or advertised price-driven menu items. As dinner traffic slowed and the average check dropped, low-priced lunch specials were added in order to entice customers away from Fast Casual.

Which segment has benefitted? As Datassential has tracked the progress of each, it has become apparent that Fast Casual is winning the battle for dining dollars. In particular, Fast Casual has effectively made the case that it offers the best of both worlds to consumers. Fast casual chains are able to offer the lower prices of QSRs, while providing the high quality and unique ingredients of Casual Dining.

We also look at the ways foodservice manufacturers are primed to help, including the existing knowledge areas that foodservice manufacturers can leverage to support operators... And, by focusing on quality-based values instead of cost, Fast Casual has created a more sustainable model for long-term growth. As the economy recovers, both QSRs and Casual Dining are finding it difficult to raise prices and increase the average check.

So what can Casual Dining do to reverse the trend and regain momentum? Our research has uncovered the tactics that Casual Dining can use to set itself apart:

  • How casual dining can leverage their social, "bragworthy" nature by becoming more mobile-friendly
  • How small plates, late night menus, bar bites, and other shareable menu items can attract adventurous diners looking for a communal dining experience
  • How some casual operators are creating new fast casual counterparts to differentiate themselves and capture lunch patrons

We also look at the ways foodservice manufacturers are primed to help, including the existing knowledge areas that foodservice manufacturers can leverage to support operators create sustainable long-term impact and regain momentum. Login to find out what you can do to drive operators' success.

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