| Examining the key shifts in trends, locations and consumer behaviour in the UK casual dining market.” |
Casual dining restaurants have played a significant role in developing leisure destinations alongside cinemas in the UK. Consequently, changes in development activity amongst leading casual dining operators could impact the plans for a number of new cinemas across the UK.
What are the drivers for these developments: market forces, changing consumer habits or reviews in strategy? What are the prospects for new entrants to the market?
Savills Leisure Agency has conducted extensive research in this market and have published very significant results which make for essential reading for anyone involved in this sector. The report is entitled “Casual Dining in the UK, 2016. Examining the key shifts in trends, locations and consumer behaviour in the UK casual dining market.”
Market Size: Casual dining spend at household level is increasing. This is less about increasing eating out spend and more closely aligned with changing the kind of places that people choose to eat out in. To this end the rising casual dining market is linked to a shift in attitudes away from a drink-led culture towards a higher quality, yet informal dining experience
Changing consumer behaviour: Millennials and families are leading the way. Casual dining has reached a point where it is both influencing and being influenced by a change in consumer trends that impacts on a wide range of demographic groups. However, certain groups are leading the way, or have the potential to result in significant growth if their spend can be captured. The two main groups on the radar are Millennials and Families.
Growth brands: Small chains have witnessed sharp increase in growth. The casual dining sector remains dominated by long established brands, (eight brands with more than 100 restaurants in their portfolios represent 44% of all casual dining restaurants). Yet almost 80% of the market is made up of brands with fewer than 25 restaurants and it is this area that has seen the starkest growth in the last few years. Small chains have increased by 39% in the last three years, versus large chains increasing by 13%.
Market opportunity & saturation concerns: Increased demand for diversity and quality of experience. Gradual changes in food culture through the availability of ingredients, cookery programmes and health awareness, have increased demand for more diversity and quality of experience in the dining market. People are drinking out less and eating out more and as a consequence, drink-led eateries are growing much more slowly than in the past and food-led establishments are surging. This provides a great opportunity for further casual dining growth across the UK.
Looking ahead: Significant potential exists for casual dining sector.
* Casual dining accounts for 7% of the overall eating-out market, the potential for expanding branded restaurants is therefore significant.
* Consumers are becoming more informed with food trends and styles, more expectant of good service, value and experience, more confident with preferences and sharing of opinion, and more tech savvy, social media connected and open to innovations and new concepts.
* Millennials are the most tuned into these cultural shifts, other demographic groups, in particular families, are not far behind
* Brands with fewer than 25 restaurants has seen the starkest growth in the last few years; a trend that is expected to continue.
* While Italian and pizza restaurants account for 45% of branded restaurant provision, recent changes to culinary preferences have been rapid; American style brands restaurants have alone increased by 80% since the financial crisis.
* Major city centres have witnessed significant growth in the casual dining sector in recent years, but some of the biggest growth in casual dining is now being seen in more regional towns and cities across the UK, like York, Leicester and Cheltenham.
The full report can be found here.