Post-COVID opportunities for the eating out market

Wednesday, 3 March 2021

Hospitality has been one of the industries most affected by the coronavirus pandemic, and the challenges look set to continue. Estimates suggest that eating-out consumption declined by over half in 2020 with restaurants, cafes and bars forced to close during lockdown.

As we continue through the third national lockdown, which looks set to be the longest, we predict recovery of the eating-out market will be subdued throughout 2021.

Restrictions will remain even when lockdown is lifted, providing further barriers for operators, with food safety and cleanliness being a top priority for consumers. Many are wary about returning to food establishments, with CGA’s 2021 Hospitality Consumer Forecast indicating that half of consumers currently lack the confidence to eat out.

Operators will therefore need to encourage consumers back by capitalising on trends that were apparent pre-COVID as well as ones that have emerged throughout this challenging year.

Click on the trends below to read more and explore the opportunities for red meat and potatoes.

While this seems counter-intuitive due to labour challenges, menu customisation increased in 2020, with 21% of dishes on Spring/Summer 2020 menus advertised as customisable (Lumina Intelligence Menu Tracker). With the average menu length reducing by 22% compared to the previous year, customisation provides a way for diners to still get the meal they want, including those with dietary requirements such as vegan/vegetarian. These smaller menus have also allowed operators to adhere to strict safety measures whilst also retaining high quality and consistency levels.

Opportunities for red meat and potatoes

  • Consider the flavour profile of main dishes – could red meat be easily added to a dish, perhaps even those that are vegan or vegetarian at their core.
  • Offer customisable options to fit dietary needs, such as leaner cuts, bunless burgers or offering grilled meats and oven-baked potatoes, over fried options
  • Ensure potatoes remain the preferred side dish, perhaps via suggested side servings or as part of a meal deal

Many are turning to foodservice and takeaway for a treat, with a third of consumers saying this was a reason for their out of home food purchase (Lumina Channel Pulse, 4 we 27 Dec 20) – making it the number one need. Indulgent menu new product development in 2020 included classics with a twist, such as Hungry Horse’s lasagne-in-a-pizza – mixing two of Britain’s favourite dishes.

As part of the government’s obesity strategy, mandatory calorie labelling will come into play for larger out-of-home food businesses in the near future. This will directly challenge this theme of indulgence, however ‘treating’ will still be an important factor, especially post-COVID, when people use out-of-home occasions to meet with friends and family.

Opportunities for red meat and potatoes

  • As household staples, red meat and potatoes should be well placed to benefit from this trend. Loaded fries took off a few years back and should be well placed to benefit from this need for a treat.
  • Burgers have already gained share of menus in 2020, and other favourite red meat dishes can also be elevated, such as pork sausage rolls and lamb kebabs, and should remain of high quality to command a higher price point and satisfy diners.

At the other end of the spectrum is health. In the out-of-home market, meals chosen for health reasons remain in the minority, especially when compared to in-home meal choices. However, for those seeking healthier foods, some believe vegetarian and vegans meet this need and may turn to these options. This includes people following those specific diets, as well as the 12% of British households who say they are flexitarian (Kantar, 52 w/e 23 Feb 20) and therefore limit the amount of meat they eat.

Opportunities for red meat and potatoes

  • Continued interest in these diets should provide an opportunity for potatoes, but so far they have not seen increased presence on menus and still rely mainly on sides (mostly in the form of chips/fries), so increasing presence in main dishes could be an option.
  • With health a key reason for people choosing a flexitarian diet there is continued need to reassure consumers about the nutritional benefits of red meat in the diet. Our previous research also showed that this reassurance will also resonate with those not following this diet.

Quality comes in many forms and terms related to provenance can often be used to signify quality. Not only can this reassure consumers, it can also help command a price premium; UK menu analysis from Lumina Intelligence suggests that the ‘Angus’ keyword for beef carries a 67% higher price tag than other same line beef dishes. At the current time, provenance also remains a key aspect of food safety and fulfils the consumer desire to support local businesses and reduce food miles, with a third of consumers claiming they try to buy local produce in order to reduce their food miles (AHDB/YouGov Consumer Tracker, Nov-20).

Quality will be more important for consumers looking to dine out, seeking the occasion for a treat or way to socialise. It provides an opportunity to show value for money – better quality to justify a price point. However, some households will have to cut back as their disposable income is hit by the recession.

Opportunities for red meat and potatoes

  • For potatoes, provenance as a cue for quality could come in the form of the named geographical area they are sourced from. If able to go further and name the specific grower or farm from where they are sourced, then this would further tap into that desire to reduce food miles and support local. The same applies to red meat, but there is an increased variety in number of terms that could be used, whether that be breed, origin, outdoor bred or free range.

Sustainability has taken a short-term back seat as cleanliness and food safety became more of a priority for consumers during the pandemic. According to Lumina Intelligence’s Top of Mind report, 56% of operators in the eating-out market are prioritising sustainability initiatives in 2021 – still a significant proportion, but lower than the 64% two years’ ago. Operators should be mindful that this trend will re-emerge and should be open about their efforts to be more sustainable. Packaging tends to be the main focus of sustainability, and a return to the initiative to reduce single-use plastics will be welcomed by consumers post-COVID.

Other sustainability initiatives include reducing food waste, while more high-end establishments can further elevate their quality credentials via sourcing and product utilisation that preserves resources and enhances biodiversity.

It is important to remember that price remains a key factor: there is still a gap between sustainability concerns and consumer willingness to pay more for these initiatives. However, it will help preserve overall brand image for longer-term equity building.

Opportunities for red meat and potatoes

  • There is a need for sustainable options across all routes to market, including takeaway. The quality of the meat or potato dish should not be let down by packaging being an afterthought – packaging can be a huge enhancement or detractor as to how the product is perceived.
  • Be sure to highlight sustainability initiatives, whether that be a small change to reduce food waste, or initiatives that run throughout the supply chain, highlighting a collaborative farm-to-fork approach to meeting this need

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