The State of the Restaurant Industry - August 2020

Are consumers beginning to venture back out to restaurants as coronavirus lockdowns ease up? From a national perspective, restaurant foot traffic has been flatlining for several months, but there have been some noteworthy gains in specific dayparts, regions, DMAs, and sub-categories. 
How much is restaurant foot traffic improving?
We use our smartphone geolocation panel to assess the visitation patterns of 2 million opted-in consumers, and what businesses they visit nationwide. Since June 1st, total foot traffic to all businesses has consistently been down by about -32% nationally, relative to a February baseline.
Food retailers (like grocery, convenience, dollar, club and mass) are faring slightly better - foot traffic is only down -24% over the last few months compared to February, as consumers increasingly make food at home.
Restaurant foot traffic has suffered more - it is down -37% compared to February, obviously due in part to dining room closures and also increased value-consciousness and health-consciousness among consumers.
When is restaurant foot traffic improving?
Looking specifically at total foot traffic to bars and restaurants compared to February baselines, the dayparts in which foot traffic has improved the most are Lunch and Dinner. Breakfast and Afternoon have had a more modest recovery, but saw improvement once consumers started returning to work and again visiting for commute and work lunch occasions. The Late Night daypart continues to have the weakest performance throughout COVID.
Where is restaurant foot traffic improving?
When looking at rural, suburban and urban DMAs, rural areas have seen the largest increase in bar and restaurant foot traffic compared to the national average. Suburban DMAs are about on-par with national, and urban DMAs are underperforming the national average.
Examining regional performance since May 1, the Midwest has outperformed the national average, the South has been about on-par with National, the West is increasingly underperforming national, and the Northeast has seen a big comeback since low points in June and is now outperforming national.
How much are consumers spending on food (restaurants + retailers)?
Using our credit/debit transaction panel, which tracks the spending of 6 million consumers at any business nationwide, we analyzed the year over year change in share of consumer spending on food.
Total food spend has actually recovered back to pre-COVID levels, despite continued foot traffic stagnation. This is due to a combination of increased spend per trip, as well as the use of off-premise purchase methods in restaurant and retail like delivery, curbside pickup and click and collect. Dollar stores and Limited Service Restaurants in particular are performing best in terms of spend per capita.
Market share in restaurant sub-channels
There has been some resurgence of non-QSR channels in recent days, specifically with Frozen Desserts and Fast Casual. Casual Dining, while still down the most, is also seeing some recent improvements.

Zooming in to the Quick Service channel
In recent weeks, total Quick Service sales are now positive across the country and have surpassed pre-COVID levels in all regions except the Northeast.
As Quick Service has recovered, the areas driving that improvement have been:
  • The rebound of Sandwich and Coffee channels,
  • The continued strong performance of Chicken and Burger,
  • Sustaining high check size growth, even as transaction volume increases, and
  • Improvements at breakfast and with core value-conscious consumer segments.
Read the blog for a deep dive analysis of Quick Service Restaurant consumer behavior.

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