Millenials Ruining Restaurants with Their Careful, Cost-Conscious Eating Habits
Restaurant visits are slipping and guess who they're blaming? Millenials.
It's turning out that 18-to-30-year-olds just aren't going to restaurants much. Fifty to 60 million of these young people are going out to restaurants far less than baby boomers did at that age, according to Stephanie Strom.
And restaurants are hurting. Strom reports that research has shown that "restaurant visits among millennials have fallen 16 percent over the last four years, failing to pick up even as the economy has improved.
The outlook for the restaurant industry over the next 10 years is dismal,” Bonnie Riggs, a restaurant industry analyst at a consumer marketing firm, told Strom.
Sales are expected to grow less than 4% in the next 10 years for places like McDonald's and even fast-casual outlets like Chipotle, a very bad thing for restaurants.
In fact, McDonald's sales in stores open a year fell 1.2%, after rising every quarter for almost the last decade, as it reported last month, Strom notes.
Millenials tend to spend their "dining dollars" carefully, Strom points out. “This was the group hardest hit by the economic crisis, and there’s a debate right now about whether their purchasing behavior has changed fundamentally as a result,” Strom quotes Tony Pace, chief marketing officer for Subway, in her story.
This is very bad for restaurants. It's not that millenials don't eat at places like McDonald's and Subway (McDonald's, Wendy's and Burger King get 28% of millenials' fast food purchases), it's just that they don't eat there very often, Strom relates.
They've also switched to newer burger places like Shake Shack, In-N-Out Burger and Smashburger.
"In an internal memo obtained by Advertising Age, McDonald’s said it was not in the top 10 restaurants among 18- to 32-year-olds, and it calculated that without its new Premium McWraps, it could lose 22 percent of those customers to Subway," Strom writes. McDonald’s now features blueberry pomegranate smoothies and Fish McBites for a limited time to suit millenials' desire for healthier choices.
So where can restaurants go for help? Once again, baby boomers. As Riggs told Strom, “The growth of the morning meal at restaurants is almost entirely supported by boomers. They’re holding the industry even at this point.”
It's turning out that 18-to-30-year-olds just aren't going to restaurants much. Fifty to 60 million of these young people are going out to restaurants far less than baby boomers did at that age, according to Stephanie Strom.
And restaurants are hurting. Strom reports that research has shown that "restaurant visits among millennials have fallen 16 percent over the last four years, failing to pick up even as the economy has improved.
The outlook for the restaurant industry over the next 10 years is dismal,” Bonnie Riggs, a restaurant industry analyst at a consumer marketing firm, told Strom.
Sales are expected to grow less than 4% in the next 10 years for places like McDonald's and even fast-casual outlets like Chipotle, a very bad thing for restaurants.
In fact, McDonald's sales in stores open a year fell 1.2%, after rising every quarter for almost the last decade, as it reported last month, Strom notes.
Millenials tend to spend their "dining dollars" carefully, Strom points out. “This was the group hardest hit by the economic crisis, and there’s a debate right now about whether their purchasing behavior has changed fundamentally as a result,” Strom quotes Tony Pace, chief marketing officer for Subway, in her story.
This is very bad for restaurants. It's not that millenials don't eat at places like McDonald's and Subway (McDonald's, Wendy's and Burger King get 28% of millenials' fast food purchases), it's just that they don't eat there very often, Strom relates.
They've also switched to newer burger places like Shake Shack, In-N-Out Burger and Smashburger.
"In an internal memo obtained by Advertising Age, McDonald’s said it was not in the top 10 restaurants among 18- to 32-year-olds, and it calculated that without its new Premium McWraps, it could lose 22 percent of those customers to Subway," Strom writes. McDonald’s now features blueberry pomegranate smoothies and Fish McBites for a limited time to suit millenials' desire for healthier choices.
So where can restaurants go for help? Once again, baby boomers. As Riggs told Strom, “The growth of the morning meal at restaurants is almost entirely supported by boomers. They’re holding the industry even at this point.”
And it's true. All you have to do is wander into a Burger King or McDonald's early in the morning to see the seats dotted with white-haired (or bald), chunky retirees starting their day with their egg McMuffins (which come in egg-white versions for millenials).
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