Insights Into the Evolution of the QSR Drive-Thru

Drive ThruDrive-thrus have been a part of quick service restaurants for the past forty years. While their importance remains the same, the focus of the drive-thru has shifted over time.

In the beginning it was about speed: how quickly orders were filled and how many customers were served during peak hours. Menus were simpler back then, making speed an obvious goal to have. But times have changed. Complex menus and the desire for personalized orders have caused speediness to take a back seat. But while orders might be filled at a slower place, they’re being filled more accurately.

QSR Magazine and Insula Research published this year’s Drive-Thru Performance Study, which revealed the slowest drive-thru speeds seen in a long time. The study has been an annual effort for the past 15 years and focuses on six well-known fast food chains: Burger King, Chick-fil-A, Krystal, McDonald’s, Taco Bell and Wendy’s, with one rotating brand, which this year was Taco John’s.

On average, speed showed a dip this year. McDonald’s experienced its slowest average drive-thru speed in the history of the study (189.49 seconds), and Burger King was the only brand to improve its speed of service this year.

This increase in drive-thru time isn’t necessarily a bad thing. Speed may have decreased, but accuracy has increased. The study revealed that accuracy has reached 90 percent for most brands. Decreased speed can largely be attributed to more complex menus in the QSR world and customers’ desire to “have it your way.” Restaurants have made it a priority to make sure orders are being filled correctly the first time, which decreases speed but increases accuracy and overall satisfaction.

With 60-70 percent of business coming through the drive-thru lane, it’s important for brands to invest in drive-thru innovations to stay competitive and continue to give their customers what they want: an efficient way to grab a bite to eat that’s quick and accurate every time. The drive-thru experience is just as important as the in-store experience, so slow down and make each car feel welcome.

Photo credit: Ian Muttoo

QSR Insights: Redefining Value As More Than A Price Point

DQ Five Buck LunchAre we reaching the point where dollar menus are losing their luster? Maybe.  Nowadays, perceived value for menu items is becoming more important to customers.

According to a study conducted by Phoenix Marketing International, customers don’t mind paying higher prices as long as there is perceived value in the items or bundle of items and, “ads that include some sort of value message are significantly more likely to drive QSR visits than other ads in the category.”

Meaning, dollar menus and price points aren’t the only value positioning driving traffic to QSRs. Bundling, family meals, and combo meals are other types of value offerings that are increasing traffic.

  • Dairy Queen’s $5 Buck Lunch is a one-of-a-kind combo lunch deal in the QSR category: a value meal that includes dessert. The $5 Buck Lunch is available 11:00 a.m. to 4:00 p.m. at participating Dairy Queen locations and offer the customer a choice of a ¼ lb GrillBurger with cheese, 3-piece Chicken Strip Lunch or a Chili Cheese Dog, plus fries, a drink and your choice of small sundae.
  • Pizza Hut’s $10 Dinner Box is an example of bundle deal that satisfies a large group of friends or family. It includes one medium rectangular 1-topping pizza, 5 breadsticks with marinara dipping sauce, and 10 cinnamon sticks with icing, all in one convenient box.
  • Wendy’s Right Price Right Size menu gives customers an opportunity to bundle items together and mix and match to create a personal dining experience.  The menu offers items that range from 99 cents to $1.99 and includes offerings such as Jr. Bacon Cheeseburger, Value French Fries, Small Chili, Spicy Chicken Go Wrap and Small Original Chocolate Frosty.

These are just a few examples of how the traditional value menu has evolved over time. A practice that once started with dollar offerings and smaller portions has reemerged as a satisfying option that is still easy on the wallet, but lets customers redefine value to meet their needs.

A thoughtful design, planning, and implementation of a catering strategy could significantly boost quick serves’ sales.

QSR Insight Bite: QSR Magazine offers 5 Catering Tips for QSRs

As a whole, the restaurant community is beginning to understand how and why the layering of catering and off-premise opportunities can alter their unit economics by increasing their revenue stream. As a quick-serve operator, focus on filling consumer demand for catering and experience a serious lift in sales.

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QSR Insights: More Fast Casuals Add Alcohol to Menus

Chipotle is among the fast casual restaurant chains that serve liquor.Fast casual restaurants were once able to brand themselves with their menu items, décor and great service, but now customers are searching for something more: booze. And now that more dining establishments are serving alcohol, customers expect their favorite spots to provide that unique drink they can’t get anywhere else.

And fast casual restaurants are beginning to catch on.

Freebirds World Burrito was early to the game when it comes to selling alcohol. In fact, Freebirds CEO Bryan Lockwood summed it up well years ago:

“If a group of people is discussing where to eat, the veto vote is the one guy who says, ‘I don’t want to go there because I want a beer,’” he says. “Having wine and beer available eliminates that vote and puts us higher in the rotation. It’s an important part of our business, because it’s a differentiator.”

Freebirds has been selling draft, craft and bottled beer for years but is currently testing margaritas in Kansas and Missouri.  Starbucks has been investigating including alcohol on its menu, too.

David Henkes, vice president of Technomic Inc. says, “that adding alcohol can account for 3-7 percent of a fast casual’s sales.”

Alcohol can also be an attractive menu option for several customer demographics, including Millennials. They are dining out more than other generational cohorts and according to Technomic, “20% of Millennials agree that it’s important for restaurants to serve alcoholic beverages.”

Scarborough recently released a report on Millennials drinking habits. The report shows that Millennials enjoy red and white wine equally, light domestic beer and vodka.

Bottom line, alcoholic beverages is a big draw for Millennials, they expect it, enjoy it and want it. No, offering alcohol isn’t for every restaurant or location, but it’s something that could help elevate the fast-casual dining experience to a new level.

Photo credit: Peter Dutton

QSR Quick Bite: Dairy Queen first QSR to offer light smoothies

For any brand–quick service or not–being a pioneer is often the ultimate dream. And this week, Dairy Queen is making this dream a reality as it becomes the first quick-service restaurant in the industry to offer light smoothies.

The new product line comes as part of the national rollout of Orange Julius Premium Fruit Smoothies to the brand’s 4,000 Dairy Queen units across the U.S. and Canada. It features eight flavors: Orange, Strawberry, Strawberry Banana, Tripleberry, Mango Pineapple, Berry-Pom, OrangeBerry, and Piña Colada.

To promote the Light and Premium Fruit Smoothies, the company has launched the first national television campaign in Orange Julius’s 87-year history, as well as print, digital, social marketing campaigns.

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QSR Insights: Trend toward more eclectic Lent options

Restaurant chains are constantly developing new menu items and the Lent season has become a key period for menu innovation in the last two years.  For many Christians, Lent (the 40-day period between Ash Wednesday and Easter Sunday) means abstaining from eating meat on Fridays.

QSR Lent Offereings

What could mean lower traffic for restaurants has instead inspired new innovative Lenten seafood offerings, moving past the typical and expected fish sandwich.

McDonald’s introduced Fish McBites this year, an item that is available on both the regular menu and Dollar Menu. McDonald’s has also improved its Filet-O-Fish sandwich, and announced in January that Marine Stewardship Council certifies the fish as 100 percent sustainable.

Marie Callender’s restaurants is promoting several seafood options this season, Salmon & Jumbo Shrimp, Grilled Mahi Mahi Cabo Tacos and Crispy Jumbo Shrimp Dinner as alternative options during Lent.

Popeyes Louisiana Kitchen brought back its Butterfly Shrimp for the season. Served in Popeyes’ original Seafood Tackle Box: shrimp, Cajun fries and buttermilk biscuit.

Quiznos brought back its Lobster and Seafood Salad sandwich as well, offering an alternative to sandwich lovers and a healthy under 500-calorie option.

Wendy’s has introduced its Premium Cod Fillet Sandwich, which includes a 3.4-ounce hand-cut fillet of 100 percent North Pacific Cod with panko crumb coating.

These are just a few examples of how restaurants are accommodating consumers who observe Lent and showing they are listening to what their customers want. This can help encourage brand favorability and increase positive brand perception.

Giving customers a way to stay loyal to their Lenten obligations and still enjoy your brand is a great way to show customers you support them.

Plus, some restaurants have found that menu items developed specifically for the Lent season have performed so well that they were added to the menu full time.

David Kincheloe, president of National Restaurant Consultants in Golden, Colorado, told QSR Magazine that “one of his clients started offering lobster bisque on Fridays during Lent and sold out almost immediately. Now the restaurant is looking at adding the item to the year-round menu.”

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2013 QSR Trends and Insights

Trends toward healthy and exotic foods will continue in 2013.This year, health and healthy are expected to continue to be top of mind for consumers, and menu innovation from main dishes to beverages will drive the CPG category. A recent article from QSR Magazine discusses predictions for the top food trends in 2013:

  1. Going Local – Customers increasingly view “local” as a positive attribute. Local sourcing is a “macro trend that will maintain its momentum,” this year, says Joy Dubost, a registered dietician and director of nutrition and healthy living for the National Restaurant Association.
  2. Healthy kids’ meals – Healthy and creative kids’ meals will continue to make an impression on the industry. These efforts aren’t just appealing to parents—kids are becoming more comfortable with healthier food choices as well. Suggestions include substituting grilling for frying and introducing options that kids can relate to.
  3. Economic struggles – Although quick-service restaurants have been climbing out of the recession, operators will have to continue to work to overcome barriers, says Bonnie Riggs, restaurant industry analyst for market research from NPD Group. Chicken is predicted to have an increased presence on the menus because its price is projected to remain stable.
  4. Snacks as meals – Around-the -clock eating is becoming more common and customers are demanding smaller and flexible portions to accommodate these habits. Many QSRs have already moved toward snack options, e.g. McDonald’s Spicy Chicken McBites LTO, KFC’s Chicken Little sandwiches, and Sonic’s Cheesecake Bites.
  5. More fruits and veggies – QSRs are moving past potatoes for french fries or tomatoes and lettuce on a burger with fruits and veggies taking on a starring role. Options like spinach, broccoli, edamame, mushrooms are available at salad chains like Freshii and Tossed, and are likely to show up on a wider range of menus this year.
  6. Gluten-free options – Thirty percent of all adults say they are cutting back and trying to avoid gluten and these people are looking for more dining out options. It doesn’t appear to be a trend, but more of a long-standing desire and it will be wise for restaurants to adapt their offerings.
  7. Trickle-up trends – Traditionally food trends start in fine dining and end up in quick service, but now that trend is reversing. “Fast casual will be the way of the world this year,” says Andrew Freeman, founder of Andrew Freeman & Co. He believes limited-service brands will be leaders in new menu items during 2013.
  8. Ethnic foods – Exploration beyond Chinese food has led to a desire for Thai and Vietnamese, just as those who favor Mexican have moved toward the flavors of South America. As the customers’ palates continues to broaden, restaurants will need to expand menu offerings that play on these flavor desires.
  9. Innovative beverages – Fruit and vegetable juices are showing strength. Fun, new drinks are worth looking into, whether alcoholic or non-alcoholic. Starbucks has expanded its Evolution Fresh bottled juices beyond West Coast markets, and they intend to add standalone Evolution Fresh stores that offer made-to-order juices.
  10. Evolving around health care – The Patient Protection and Affordable Care Act will take full effect in 2014, which means operators will have additional paperwork and higher costs associated with day-to-day operations. This year, the industry will likely face more consumer and legislative pressure to make changes to the size of beverages and add calorie counts on menu boards.

What is your take on these trend predictions? Do you see any other emerging trends that are worth noting in 2013?

Photo credit: Arvind Grover

QSR Insights: No Holiday Is Too Small

SandwichesIf it weren’t for an 18th century English nobleman who requested his lunch meat be placed between two slices of bread so his hands wouldn’t get greasy while playing cards, we wouldn’t have the beloved sandwich.

Today, sandwiches are a go-to meal option with hundreds of varieties and combinations. They are enjoyed worldwide and have become considerably more sophisticated than the average bologna sandwich.

National Sandwich Day is celebrated in many different ways each November 3rd, but each way pays respect to this worldwide favorite!

This year, Subway celebrated the quirky holiday by showcasing their global sandwich flavors across their worldwide footprint. The popular sandwich maker is known for adapting menu items to local customs, religious traditions and food preferences. According to The Daily Meal, in Japan Subway featured a duck pastrami sandwich with sweet orange sauce, and in Sweden they served Skagenröra, a mix of shrimp, mayonnaise, lemon, herbs and spices.

Sonic Drive-In used the holiday to unveil their limited-time Asiago Caesar Chicken Sandwich and improved Classic Chicken Sandwich. The drive-in franchise took it a step further and created a YouTube video that shows how these two sandwiches were developed and prepared, allowing their customers to see behind the scenes lends to further engagement with the brand.

Some restaurants celebrated National Sandwich Day with a friendly face-off to decide who makes the best sandwich. In Boston, three restaurants, Chez Henri, Roxy’s Gourmet Grilled Cheese, and All Star Sandwich Bar, went head-to-head to compete for the best sandwich title.  They competed in a three-course meal; each entrée was a unique sandwich with sophisticated flavor profiles.

It’s important for QSRs to take advantage of the smaller holidays that pay respect to items your customers are already enjoying. Whether it’s National Sandwich Day, National Hoagie Day (May 5), or National Cheese Lover’s Day (January 20), customers enjoy celebrating—so help give them a reason to visit your restaurant to do it!

Photo credit: U.S. Department of Agriculture

QSR Insights: Bringing Breakfast Back to QSR

Breakfast options at Arby's

Mornings are a chaotic time. The alarm is going off. You snoozed a few extra times, and now you’re running late for work. Grabbing breakfast as you run out the door or swinging by the gas station becomes a normal routine.

So how do you encourage your prospective customers to change their routines and head to a QSR instead? Marc Halperin from QSR Magazine believes it’s possible and has three suggestions to make it a reality:

  1. Seek out the fun and novel. Provide menu options that are transportable, handheld, neat and versatile, with both sweet and savory possibilities. Eating in the car can be messy and a hassle, so including menu options that overcome these barriers will help drive morning foot traffic.
  2. Shoot for utter uniqueness. Oatmeal and smoothies have become the norm on breakfast menus, so how do you build on this? One idea is to include a line of oat or grain based beverages flavored with chocolate or coffee, offering something savory and delicious. Unique options pique customers’ curiosity so they’re willing to put in the extra effort to visit your store.
  3. Think in terms of lifestyle shifts. Breakfast is moving toward becoming a two-part process rather than a single, short event. Morning snacking is becoming more prevalent. Creating options that allow customers to eat something now and take something for later would help capitalize on this morning trend.

These three suggestions further emphasize the opportunity that Mintel discusses in their Breakfast Foods report from September 2012. According to the study, the breakfast market remained strong during the recession and is predicted to continue to grow. In fact, 57% of people Mintel surveyed view breakfast as more important than lunch and dinner.

Breakfast is evolving. How will your business evolve with it?

Photo credit: Joe Wolf