Restaurants & Fast Food Industry Report 2019

The restaurant landscape continued to shift over the course of 2018, and 2019 looks to be just as unstable. In an industry that—just a few short years ago—was enjoying a real boom, 2018 saw many high street chains fighting for survival.

Handmade Burger Co and Barbecoa were both wiped off the high street, and Byron Burger and Jamie’s Italian had to close over a third of their franchise locations  just in 2018. Zizzi, Polpo and Café Rouge are also planning to close down half of their locations.

With rent costs high, the economy in flux, and delivery services like Deliveroo and UberEats transforming the experience of ‘eating in’, it’s proving difficult to get hungry people to head out for a meal. The delivery business, though, is also on shaky ground; Deliveroo has revealed that their margins are improving this year, but were uncertain about their business profitability last year.

So much change means that adaptation is necessary: it’s no longer enough for a food establishment to provide good in-house service, and cultivating stellar options means not missing out on the crucial takeaway slice of the market. But with Deliveroo’s plans to start providing their own food (at a fraction of their current offerings price) it also means restaurants may soon have to be fighting much harder.

It’s a daunting future, but with the restaurant & fast food industry there is a good deal of spend to play for, even if it will be hard won. Because eating good food is most likely never going out of style…

Attest’s Restaurant and Fast Food report looks in more detail at the best-known and best-liked restaurants across the country.

To learn more about what we’re tracking on each of our industry reports (and why the metrics matter!), click here.

Recall

Recall refers to ‘unprompted brand recall’, or the first brand within a category that comes to mind for our audience when asked. In this category, Nando’s continues its unbeatable form, claiming 15.3% of recall and returning to the top of the table. The chicken restaurant has dominated Restaurant and Fast Food Brand Indexes at Attest for five straight quarters and their dominance shows no sign of slowing down. With recall dropping by less than a percentage point, it’s clear that despite fluctuations, the brand is consumers’ firm favourite when it comes to share of mind.

McDonald’s, too, reclaims its place in the table, coming in second, though their recall has fallen by a significant 1.6%. The global fast food giant released their full year results at the end of January. Despite beating consensus earnings, they fell short of Q4 revenue targets. In a changing food scape—now decked out with sugar taxes and changing regulations around fast food advertising—this is a brand who have a crucial period ahead. Retaining share of mind will be important if they are to retain customers as they inevitably shake up their brand.

KFC and Pizza Hut retain their 4th and 5th places. KFC’s recall falls by almost a percentage point, while the pizza chain snatches an extra 1.3%.

There are two newcomers to this quarter’s brand index: Toby Carvery at number 6 and TGI Fridays in 9th place. TGI Friday are certainly demonstrating a forward-looking approach to their offering: they have just announced a ‘bleeding’ vegan burger will be added to menus across the UK. It’s an attitude in line with changing consumer sentiment (our Health and Wellness data shows that 49% of UK consumers now view veganism as a healthy lifestyle choice, and 12% plan to take it up this year) and decisions like this bode well for their increased share of mind.

Prezzo and Wagamama fail to retain their place in the top 10, despite Wagamama coming in  6th place at the end of last year with 4.6% of recall. Prezzo struggled greatly last year, closing 93 of its restaurants, and the declining high street presence is reflected here. When restaurant locations work so well as an advertising mechanism, there’s correlation between reduced street presence and reduced share of mind.

Purchase Intent

Purchase Intent (indicated by those that selected ‘very likely’ when asked whether they’d shop with the brand they named in the Unprompted Recall section of the survey) vary widely across the restaurant industry. The scores of our top ten range from 29.6% to 75%.

The highest purchase intent was scored by Toby Carvery, and was 15% higher than the next best score (achieved by Pizza Express).

Harvester struggled most, with only 29.6%. Combined with their low ranking in the overall table (due to their small portion of recall), they will need to improve how reliable and likeable they are with consumers if they are to hold their spot.

Our top three—Nando’s, McDonald’s and Pizza Express—all performed well here, showing that to make it to the top, it’s crucial to not only be a giant, but one that consistently produces great tasting food and drinks.

NPS

A brand’s Net Promoter Score (NPS) refers to how likely respondents are to recommend the brand they named to a friend or colleague.

On the whole, NPS is strong in this industry. With the offering being designed to induce quick, simple pleasure (both the fact of not having to cook, and the indulgent taste of what’s on offer at restaurants and takeaway options), it’s an industry where likeability is key.

Harvester, again, show cause for concern as the only brand awarded a negative score:  -7.4. After a scandal at the close of 2018, where ice and soda water found at many of the UK’s leading food and drink chains were found to be contaminated with bacteria and coliforms, Harvester saw its reputation tarnished.

This could also be related to the modest 27.9 scored by Wetherspoons. It does not, however, affected Toby Carvery who achieved a respectable 40.6.

At the top of the NPS rankings were TGI Fridays (52.2) and Pizza Express (50.0). This correlates to high purchase intent and demonstrates that strength in both metrics is crucial to retaining overall standing.

Key Attributes

The Attest Brand Index looks at each brand’s performance across various categories, which we call “key attributes”. All key attributes and are carefully selected as markers of success for a consumer brand.

Here’s how the top 10 brands performed across the key attributes for the restaurant and fast food industry:

It is notable that amongst the top 10, all do exceptionally well in the convenience metric. In the age of takeaways, and on-the-go eating, this is a very important quality to curate for consumers with busy lives.

There is little variance in this metric, with all scores ranging from 79.6% to 90.1%.

McDonald’s comes top for the memorability of their brand: the famed golden arches are working hard for them. They flipped them upside down last year for International Women’s Day, and the giant yellow M got much television exposure last summer, as they sponsored the World Cup. The world over, it’s difficult to miss McDonald’s branding.

Meanwhile, Wetherspoons scored lowest when it comes to brand (59.2%). This is unsurprising given that last year the chain stated that they are “not a brand”: they want to maintain individual identities for each of their pubs, with newer branches even having bespoke carpets. That said, this approach may be hurting performance when it comes to share of mind.

Reliability, like convenience, is particularly key to this industry, with all our top performing brands receiving strong scores in this attribute.

Across all 10 there is a drop in scores for ‘inclusivity of dietary requirements’ with scores in the fifties and sixties. Around 7% of children in the UK now have food allergies, and this figure is on the rise. 2018 was also the year that restaurants were forced to take dietary requirements seriously, after the tragic death of Natasha Ednan-Laperouse due to Pret A Manger’s lacking ingredients information. ‘Inclusivity of dietary requirements’ is an attribute that is rising in importance, and it seems that restaurants aren’t yet doing enough to convince consumers that they’re on top of it.

Restaurant and Fast Food Brand Index Leaders

The overall leaders of the 2019 Q1 Restaurants and Fast Food Brand Index were as follows:

Brand Strength is a measure of how well a brand is thought of in their market, and the Total Brand Equity (TBE) refers to how well thought of each brand is in relation to how well recalled it is.

Below, you can see how the Brand Index leaders show up when we plot Total Brand Equity (TBE) an against the matrix of ‘well known and well liked’ brands.

Key Takeaways

• Established budget brands with strong delivery contingents continue to dominate the UK restaurants and fast food market
• The appeal of junk food is dominant, with Wagamama disappearing from the Top 10, and all brands on our Top 10 serving either pub food, pizza, chicken, or burgers
• Convenience, reliable taste, and service are crucial: consistency counts for a lot in this industry
• With allergies, intolerances, and plant-based diets on the rise, restaurant chains who can make their menus inclusive to all consumers will see their popularity continue or rise
• Clear, distinctive branding that can be replicated wins out when it comes to how memorable your brand is
• This is set to be another tough year for the restaurants and fast food industry, which means that checking in with consumers regularly will give your business an advantage

Conclusion

This is a shifting market, facing difficulties in 2018 that only look set to continue throughout this year. It’s also an industry where—when people regularly eat out and order in—restaurants can make real differences to their reputations with every meal served. With the industry so saturated by varying price points and offerings, it’s crucial to retain as much share of mind as possible, in order to be at the front of hungry consumers’ thoughts when they’re looking for something reliable and quick.

Budget continues to win out, and taste is more important than health. All of our top 10 brands this quarter prioritise low price, great convenience, and delicious food. If your brand is curating a more expensive, or healthier offering, get in touch with us to speak to your specific target market, or to find out how you could be converting other consumer segments.

If your brand did feature in the 2019 Q1 table, we can help you find out how to stay ahead. Whether you’d like to bring more plant-based options into your offering, or need to negotiate the incoming legislation over calorie displays, we can help you test ideas and strategies on current and future consumers.