Modern Marketing Data & Privacy Economy

The cost of loving eating out: how will the recession impact fast food brands?

By Louis Devane-Waters | Consultant

Savanta

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September 28, 2022 | 6 min read

Are fast food chains safe from the coming recession? Brand analysis from market research firm Savanta affirms the UK's love for eating out, but shows increasing strain on the industry amid the cost-of-living crisis.

Five Guys burger

With consumers becoming more frugal, what will happen to brands like Five Guys? / Marcel Heil via Unsplash

In 2022, consumer confidence has hit its lowest ebb in over 15 years according to our research. Now more than ever, consumers need to get the most out of their money.

Naturally, high price points can have negative effects on brand love scores – especially during a cost-of-living crisis. But, digging a little deeper into our latest Most Loved Eating Out survey, this is not a pattern we see for the likes of Five Guys and Kaspa’s Desserts.

These American-style diner joints both score high for brand love, with Five Guys coming in at #11 and Kaspa’s at #6 (although both are rated much lower for value).

So, why do we love them so much ?

Data from BrandVue, Savanta’s daily brand tracking tool, suggests that the quality of these restaurants' food is what persuades customers. Both brands’ scores for quality of food are well above the market average – particularly Five Guys, which surpasses the market by an impressive 23%. Despite feeling they aren’t the best value for money, it’s clear that consumers are willing to part with their cash in exchange for good quality food.

Five Guys and Kaspa’s are relatively new additions to the UK. Their first stores here opened in 2013 and 2012, respectively. Since then, they have seen rapid growth, with Five Guys operating in over 150 UK locations as of August 2022.

Similarly, Kaspa’s now has 100 stores across the country, making it the fastest growing dessert diner in the UK. Perhaps viewed as exotic food stops that emulate American culture, they differ from other brands in the fast-food market like McDonald’s and Burger King – both cheaper outlets. The USP of bringing the overseas ‘diner’ feel to the UK might just be what piques consumers’ interest for the brands.

Appreciating value

Savanta’s consumer confidence tracker shows that 30% of respondents have ‘a lot less’ disposable income in comparison to the same period last year, which will likely result in consumers reconsidering how and where to spend their money. Price point will remain an important driving factor for brand love.

Chains like Wetherspoons and Toby Carvery score high on value for money but low on brand love. Perhaps in response to consumers adapting their spending behavior, we’ve seen Wetherspoons’ penetration increase from 27% in the second half of 2021 to 32% in the first half of 2022.

This hike in sales is likely a result of the current economic climate, with consumers becoming increasingly tight on spending and more inclined to opt for a cheaper dining experience.

Threat to the throne

With inflation at a record high, it's likely we’ll see increasing cutbacks on spending, meaning the hospitality industry will take further hits. Pubs and restaurants operate in an unprotected market which does not have the same insurance as that of supermarkets, whose goods are deemed essential.

The brands that score high on value for money might be in the running to overtake those whose price points are less attractive. Five Guys and Kaspa’s may sit high on Savanta’s league table, but until the economic state of the UK takes a turn for the better, their positions could be vulnerable.

Download Savanta's report for the full list of The UK's Top 100 Most Loved Eating Out Brands, plus insights on the future of the sector and how brands can stay relevant.

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