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Diners addicted to $5 subs, $10 meals, study says
November 10th, 2009, 6:18 am · 12 Comments · posted by Nancy Luna, Staff Writer
Fine dining will continue to be hit hard, survey says
Though Wall Street’s Dow Jones Industrial Average hit a record 52-week high on Monday, restaurants are not feeling the love.
In fact, the latest industry survey shows that consumer spending — as it relates to dining out — is getting worse.
AlixPartner, a Los Angeles-based financial consulting firm, revealed the results of its latest dining survey to a group of top restaurant executives gathered at a Las Vegas trade show. One of the key findings stated that consumers, on average, plan to spend $11.49 per meal over the next year.
That figure is almost 20% less than the average spending per meal reported in a similar report released in March by the firm. Diners have also become addicted to deep discounts offered by restaurants, and will base eating out choices on value over food quality, the survey said.
“Customers have been trained to take specials for granted,” said Adam Werner, who co-authored the report. “They have recalibrated their spending expectations based on the now-ubiquitous $5 sandwich and the $10 meal, and restaurants that aren’t marching in the promotions parade risk being left behind.”
Other key findings:
– the average number of monthly visits to fine dining establishments dropped 36% since the March survey
– 63% of those surveyed dined out at least once a week over the past 12 months. That’s 11% more
compared to March
– In spite of the increased visits, same-store revenue at restaurants continues to remain flat or on the decline. This indicates that diners are ordering less food, or taking advantage of deep discounts offered by restaurants.
– Value is the most often cited reason to try new restaurants; promotions are also more important to consumers compared to the previous March survey.
As a result of its latest survey, AlixPartners projected that consumer spending will likely drop 3 percent over the next 12 months as consumers shift more to meals under $5.
“While food quality today remains top of mind for the consumer, the core driver for diners continues to be value, value, value,” said Andy Eversbusch, a managing director at AlixPartners. “That determines how often people eat out, and where they eat out.”
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I’m amazed by the $11.49 per-meal average. I certainly don’t spend that much.
Well, it is an average. I’m sure there are still people out there spending $20 a person.
i don’t know , it seems that in recent memory whenever i’ve been at a pricey place like a flemings, mastro’s, sushi bar, etc… still lots of crowds and people spending money. maybe they are cutting back on what they order/drink, but it still seems they are showing up.
I’ll only go to one of these places for a very special occassion and/or when they have a particularly good deal. not the case in the past. but then I’m an average joe not a rich guy with my Bentley prominently parked out front.
There are still plenty of wealthy people out there. The only way I can tell that people are cutting back is because there are more deals and when I do go out to eat (which isn’t very often), I can get a table within half an hour instead of an hour or an hour and a half.
I’ve noticed the local McDonald’s is busier than ever these days………
We still get the Filet Mignon when we eat out, but split it instead ordering two.
Even before the recession and especially now that I was laid off more than three months ago, my wife and I usually split meals and avoided that glass of wine or beer we used to enjoy. Soon that may be me taking your food order at the local eatery. The job market is worse than ever. I graduated college over twenty years ago and NEVER had this hard of a time trying to find work.
I can make a sandwich for 50c myself better than the ones that cost $5. so why would I pay Subway to eat their inferior stuff? thanks but no thanks. guess which one I eat on a daily basis (hint, not Subway).
I’ve eaten there ONCE in all that time they’ve had that jingle. how can anyone be tempted to keep going back? I just don’t get it.
It’s not just the cost of the food at restaurants, its the overpriced drinks, the tax and also the 15% to 20% tip on the entire bill (including the tax).
Don’t go out nearly as much as before but when I do I look for the deals (always have looked for the deals) and even if / when the economy picks up will still eat at home more.
There was an hour’s wait at Claim Jumper last night (a Wednesday!)- seems like they aren’t hurting too badly!
Good job Nancy. You’re getting cited in another blog for this article.
http://www.thebigmoney.com/blogs/daily-bread/2009/11/11/diners-still-demanding-cheap-eats