Today, dining out is all about the experience – not just the food.
By Jeremy Ryland
In my two previous articles on trends - Restaurant trends to watch in 2018 and Trends for Australia's restaurant industry - that are affecting the restaurant industry, I have highlighted the convergence and casualisation of the industry, leading to the growth of informal dining out or “fine casual”. The consumer is becoming more food aware and will not put up with mediocre offerings, but at the same time is seeking value and discounts.
Consumers are going back to the basics, seeking simple “good-for-you” foods and we are seeing rapid growth in vegetarian and vegan options. There is also an increase in snacking, multiple meals and sharing plates. And with changing demographics, there is growth in solo diners.
Here are a few more trends that are affecting our dynamic, competitive and continually evolving market:
Venues in hotels
Dining in hotels used to be seen as a bit of a last resort, only to be done when you were travelling and seeking something safe and convenient. However, recently a number of high-end premium restaurants have opened in hotels and casino complexes. This is in part due to availability and economics. A hotel provides patrons and, economies of scale, often with lower rents and combined marketing. Today, some of our best restaurants are located in hotels. Premium venues are also popping up in retirement villages, bowling clubs and other locations that have underutilised facilities.
Similar to the venues in hotels, there is a growing trend for restaurants to group together in food precincts and food halls within shopping centres. In the past food courts, like the hotels, were seen as low-quality fast food options. However, today many food halls and food precincts are being developed with a range of options including high-end venues as well as more casual diners. And like the hotels, these venues offer reduced operational risks and costs for the operators together with some shared facilities including toilets, dishwashing, parking, etc.
Pop-ups are another trend that is coming back into fashion, allowing chefs to offer short time offers, often seasonal or showcasing special products. Often using unused space, pop-ups can be run inexpensively and are a good way for chefs to experiment without long term risk. Pop-ups also capitalise on the “limited time offer” marketing concepts, usually associated with the fast food chains but with a fine dining offer. Pop-ups are also a perfect target for the younger demographics who are seeking new experiences.
There has been a trend in the past towards larger menus providing something for everyone. Large menus are complex, not only to read, but also to make. We are now seeing a return to smaller, compact menus that are changed more often. The old saying “less is more” is often true and large menus simply confuse the customer who defaults to a few well-known dishes. Smaller menus see people making more choices. And at the top end of this trend are restaurants that offer no choice, with a set menu. Smaller menus and set menus reduce operational costs and often result in better quality dishes, as the chefs can focus on doing a few things well.
Single focus venues
A variation of the trend to smaller menus are venues that concentrate on one protein or one type of dish. Specialist fish restaurants, chicken restaurants, dumpling restaurants, etc. This is obviously not new. Pie shops, fried chicken, burgers, pizza, fish & chips and other QSR’s have done this for decades. But it is a new trend in the more premium markets with artisan butchers and other specialists focussing on high-quality limited menus.
Discounting is not new. Many food outlets run specials and limited time offers. However, the growth in third-party discounters such as Groupon and Eat Club, and discounting through the booking engines such as The Fork, are seeing deep discounts in all sectors, premium as well as fast food. Fifty percent discounts can drive awareness and get people to try your product. However, regular discounting simply “resets” the perceived price and value of the product. Moreover, given the large number of venues discounting at any one time, the consumer can switch quickly, and such discounting does not drive loyalty or long-term sales. Discounting should be used sparingly and for specific product awareness only.
There is a huge amount of competition in the food service industry and as previously mentioned, consumers are no longer willing to tolerate mediocrity. Why do people walk past several cafes and all congregate at one? It’s all about a positive experience from the greeting to the goodbye. The days of differentiation on price or product features alone are quickly fading, to be replaced with favourable experiences as the most desirable option people value, when making choices. Today, dining out is all about the experience – not just the food. In fact, 7/10 people prefer a cool experience over a cool product. And loyalty comes from the experience – not the product. And a genuine human experience is important. Digital can't always replace the personal experience and having staff that have a genuine connection with customers and, for example, remember which wine they ordered last time, is a completely different experience to having the same wine preference recorded on an iPad or even ordering off a screen.
Hospitality is about people. Digital communications lack oxytocin. Oxytocin is a chemical released in the human brain when we personally interact with each other. Oxytocin plays a part in social interaction, makes us feel happy and helps spark emotions and memories – the experience. And you can only get this from personal interaction and genuine goodwill – the real experience.