North America’s casual dining industry is in trouble.
Fast casual brands better feed diners’ growing hunger for new tastes and experiential formats, while pure-play fast food chains continue to provide lower cost and greater convenience. Some pundits argue consumers have completely lost their appetite for the traditional sit-down dining experience. However, we believe there is still hope… if casual dining brands stop relying on the wrong things to drive consumer engagement.
There is no denying that macro socio-economic trends have negatively impacted the middle class, resulting in a drastic re- calibration across a host of industries. America’s casual dining chains appear amongst the hardest hit because most restaurant owners grew fat on unsustainable pre-recession spending habits that resulted in over-saturation and mass commoditization.
However, the market is course correcting (evidenced by bankruptcy filings for Logan’s Roadhouse, Johnny Carino’s, Champps, Fox & Hound, and Bailey’s). Restaurant brands who have withstood the downturn should now exploit the right-sized marketplace and consume more than their fair share of the large discretionary spend of out-to-eaters. What is required is casual dining brand marketers to willingly forsake their bad habits and embrace proven cult brand principles.