Dinner-Out Declines: Economy Not Sole Factor
Although the recession has had a significant negative effect on frequency of restaurant visits for the dinner/supper meal, particularly among younger groups, the decline is a long-term trend that also has much to do with the aging population and changing lifestyles, according to a new report from The NPD Group market research company.
The evening meal is the restaurant industry's largest sales driver, but it has been the weakest-performing daypart for the past decade, according to "Getting a Grip on the Supper Market." And while dinner is the meal that normally leads the industry out of recessions, that will not be the case this time, NPD concludes.
The youngest adults -- those 18 to 31 -- represent the largest share of dining traffic (28%), and have also seen the largest drop in per-capita supper meal occasions per year. Between 2001 and 2009, their average dinners out per year dropped by 13, from 79 to 66.
During the same period, the average number of restaurant dinners per year also declined (by seven, in each case) within three of four older groups. Among those 32 to 34 (representing 19% of traffic), average dinners out declined from 70 to 63; among those 44 to 51 (20% of traffic), from 67 to 60; and among those 52-61 (16% of traffic), from 63 to 56.
Only the oldest group -- those 62 and up (17% of traffic) -- showed a slight increase in average suppers out during the period (up to 49, from 48).
What's behind these numbers? First, says NPD restaurant analyst and report author Bonnie Riggs, the numbers demonstrate a general, already-known trend: People tend to eat dinner out less often as they age. Even in 2001, the average number of dinners out per age group was progressively lower from youngest to oldest.
Therefore, the aging population is creating a shift in the profile of supper restaurant users, she points out. Whereas younger consumer groups had -- and continue to have -- the highest restaurant-supper frequency, their pullback on visits has narrowed the frequency gap -- and the sheer number of aging Boomers has increased the importance of more mature adults to the supper occasion.
"The fact that older consumers make up a larger portion of the population, and are lighter restaurant supper users, is part of the explanation" for the general slip in per-capita dinners-out numbers -- although not the full story, says Riggs.
Economic factors have also played a role, especially among younger groups. For instance, among those 18 to 31, the entire 13-visit decline actually occurred between 2006 and 2009. Although the official recession didn't kick in until December 2007, this youngest group -- which includes those with young families -- had to cut back on expenses in response to the first precipitous gas price hikes in summer 2006, and was also among the earliest and hardest-hit by employment challenges, notes Riggs. Similar economic effects, to a lesser extent, were also seen among the next-youngest group (ages 32 to 43), where most of the decline in dinners-out also occurred between 2006 and 2009.
The older groups' dinners-out cutbacks generally have been less directly recession-driven -- their average number of restaurant dinners show decline both before and after 2006. For instance, the average for "young Boomers" ages 44 to 51 dipped by five between 2001 and 2005, and by two between 2006 and 2009.
However, even shifting demographics and the recession don't entirely account for dropping restaurant-supper rates. "Even if you subtract out the changing age composition of the population, restaurant usage for supper would still be slipping," sums up Riggs. "While this is especially notable since the recession began, it was also visible between 2002 and 2007."
In short, even before the recession, adults across age groups were making changes in how they addressed supper needs for their families and themselves. This, says Riggs, points to a critical need for restaurant operators to focus on understanding and meeting the needs and motivations of their specific target demographics.
For instance, restaurants should not assume that younger consumers will just naturally return to a greater frequency of eating dinners out when the economy recovers. "Younger people indicate that they've come to enjoy the benefits of staying at home and cooking and eating with their families," Riggs says. "In addition to the family time, they cite benefits such as portion control and generally feeling that cooked-at-home meals are healthier and more nutritious."
Meanwhile, those 62 and older are a bit more inclined to eat dinner out these days, in part because some of the already-retired have been relatively less affected by the recent economic troubles, but also because they relish the convenience of eating out, says Riggs. "These consumers appreciate the ease of having someone else cook, serve them and clean up" -- perhaps pointing to a marketing direction for restaurant operators looking to attract this demographic, she notes.
Riggs also points out that while the 18-to-31 group will grow by 5% to reach 63 million by 2019, making them the second-largest age group, those 62 and up will grow by 35% to 65 million, making them the largest age group. Meanwhile, as the population ages, the 50-to-61 group will grow by 12%, but younger Boomers (44 to 51) will decline by 8%.
All of these trends are obviously extremely relevant to restaurant owners, who "can't control population trends, but can influence buying-rate momentum by understanding the levers that appeal to their target customers," observes Riggs. "Through product and concept innovations, availability, understanding their consumers' value perceptions, right pricing, and targeted messaging, they can re-attract consumers to restaurants for supper."