Fast Casual Restaurants - US - August 2007

Table of Contents

• Scope and Themes
• What you need to know
• Definition
• Resources used for consumer sections
• Abbreviations and terms
• Abbreviations
• Terms
• Executive Summary
• A robust market with room for growth
• The players
• Bread-based chains
• Traditional chains
• Ethnic chains
• Factors to growth
• Fast casual positioned to weather negative economic pressures
• Wholesome health appeal
• Cross-cultural appeal
• Challenges to growth
• Fast food
• Day part expansion and retail encroachment
• Strategy: entice with surprise
• Converting the less frequent user
• Strategy: entice curiosity seekers and provide tangible health benefits
• Market Drivers
• Cross-cultural appeal a hallmark of fast casual--and a key to its success
  • Figure 1: Fast casual menu items, 2006
  • Figure 2: Fast casual menu items, by cuisine type, Q2 2006-Q1 2007
  • Figure 3: Change in international destinations of American travelers, 2001-05 and 2004-05
  • Figure 4: Culinary-cultural representation of Panera Bread menu, 2007
  • Figure 5: Culinary-cultural representation of Buffalo Wild Wings menu, 2007
• Fast food chains compete and encroach
• Competing on premium
  • Figure 6: Average amount spent per person on last visit, by household income, April 2007
• Battling for tastebuds
  • Figure 7: New Mexican-style menu introductions, by dining type, Q1 2006-Q1 2007
  • Figure 8: Cuisine types of new menu items, by dining type, Q1 2006-Q1 2007
• Grinding it out over coffee
• Duking it out over day parts
• Competing on conscience and perception
  • Figure 9: Nutritional marketing claims accompanying new menu items, Q1 2006-Q1 2007
  • Figure 10: Top ten marketing claims, by dining type, Q1 2006-Q1 2007
• Competition from new décor
• Competition from RTE meals
  • Figure 11: Price per serving for representative meals at Dinners Ready, July 2007
  • Figure 12: Average price range for fast casual menu items, July 2007
• Lunch
• Fast casual positioned to weather negative economic pressures
• Rising gas prices may dampen motivation to dine out
  • Figure 13: Impact of fluctuating gas prices on consumer expenditures, May 2007
• Mortgage rates, foreclosure and debt weigh on the consumer
  • Figure 14: Historical trending in mortgage rates, 2005-07
• A silver lining for fast casual
  • Figure 15: Mean number of fast casual meals ordered in past month, by HH income, July 2007
• Not a matter of income at all?
• Market Size and Trends
• Market size
  • Figure 16: Total U.S. systemwide sales of leading fast casual chains, at current and constant prices, 2004-06
  • Figure 17: Fast casual as a share of population, by age, 2007
• Market trends
• The health trend
• Wholesome health appeal
• Focus on fish and chicken
  • Figure 18: Fast casual menu items featuring fish, Q2 2006-Q1 2007
  • Figure 19: Fast casual menu items featuring chicken, Q2 2006-Q1 2007
• Vegetarian overtakes trans fat-free
  • Figure 20: Fast casual general menu claims, by restaurant type, Q2 2006-Q1 2007 inclusive
• Organic and all-natural increase traction
• Increased focus on hospitality
• Market Segmentation and Supply Structure
• Introduction
  • Figure 21: U.S. systemwide sales of leading fast casual chains, segmented by menu type, 2004 and 2006
  • Figure 22: U.S. systemwide sales of top fast casual chains, 2004 and 2006
• Bread-based chains
  • Figure 23: U.S. systemwide sales of top bread-based casual chains, 2004 and 2006
  • Figure 24: U.S. systemwide units and sales per unit of leading bread-based fast casual chains, 2004 and 2006
• Panera Bread Co.
• Einstein Bros. Bagels (New World Restaurant Group)
  • Figure 25: Einstein Brothers menu items, by cuisine type, Q2 2006-Q1 2007
• Bruegger' s
• McAlister' s Deli
• Cosi
• Traditional chains
  • Figure 26: U.S. systemwide sales of top traditional fast casual chains, 2004 and 2006
  • Figure 27: U.S. systemwide units and sales per unit of leading traditional fast casual chains, 2004 and 2006
• Buffalo Wild Wings Grill & Bar
• Steak n Shake
• Boston Market
• Zaxby' s
  • Figure 28: Zaxby' s menu items, by cuisine type, Q2 2006-Q1 2007
• Fuddruckers
• Ethnic chains
  • Figure 29: U.S. systemwide sales of top ethnic casual chains, 2004 and 2006
  • Figure 30: U.S. systemwide units and sales per unit of leading ethnic fast casual chains, 2004 and 2006
• Chipotle Mexican Grill
  • Figure 31: Chipotle menu items, by cuisine type, Q2 2006-Q1 2007
• Baja Fresh
• Qdoba
• Pei Wei
  • Figure 32: Pei Wei menu items, by cuisine type, Q2 2006-Q1 2007
• Advertising and Promotion
• Summary of common themes
• Creation of streaming media as a platform for brand visibility
• Giving to the cause
• Creating stand-apart value from QSR cousins
  • Figure 33: Boston Market real food
  • Figure 34: Steak n Shake service
• Panera Bread
• Chipotle Mexican Grill
• Buffalo Wild Wings
  • Figure 35: Buffalo wings blow out
• Boston Market
• Steak n Shake
  • Figure 36: Steak n Shake fruit and yogurt milkshakes
• Bagel Moves
• El Pollo Loco
• Moe' s Southwest Grill
• Zaxby' s
• The Consumer: Eating Outside the Home
• Summary
• Eating outside the home
• Dinners eaten at restaurants and retail, on weekends and weekdays
• Weekday dinners eaten at restaurants and retail in past month
• Weekend dinners eaten at restaurants and retail in past month
• Eating outside the home
  • Figure 37: Number of meals eaten per week that are prepared outside the home, by day part, July 2007
  • Figure 38: Number of meals eaten per week that are prepared outside the home, by day part, by gender,
  • Figure 39: Number of meals eaten per week that are prepared outside the home, by day part, by age, July 2007
  • Figure 40: Number of meals eaten per week that are prepared outside the home, by day part, by HH income, July 2007
  • Figure 41: Number of meals eaten per week that are prepared outside the home, by day part, by race/ethnicity, July 2007
• Dinners eaten at restaurants and retail, on weekends and weekdays
  • Figure 42: Dinners eaten at restaurants and retail in past month, on weekends and weekdays, July 2007
• Weekday dinners eaten at restaurants and retail in past month
  • Figure 43: Frequency of weekday dinners eaten at restaurants and retail in past month, by channel, July 2007
  • Figure 44: Weekday dinners eaten at restaurants and retail in past month, by age, July 2007
  • Figure 45: Weekday dinners eaten at restaurants and retail in past month, by HH income, July 2007
  • Figure 46: Weekday dinners eaten at restaurants and retail in past month, by race/ethnicity, July 2007
• Weekend dinners eaten at restaurants and retail in past month
  • Figure 47: Frequency of weekend dinners eaten at restaurants and retail in past month, by channel, July 2007
  • Figure 48: Weekend dinners eaten at restaurants and retail in past month, by age, July 2007
  • Figure 49: Weekend dinners eaten at restaurants and retail in past month, by HH income, July 2007
  • Figure 50: Weekend dinners eaten at restaurants and retail in past month, by race/ethnicity, July 2007
• The Consumer: Usage of Fast Casual Restaurants
• Summary
• Usage and frequency of use
• Usage of fast casual restaurants, by type
• Usage of fast casual restaurants
• Figure 51: Mean number of times fast casual ordered in past month, by gender, age, HH income and race/ethnicity, July 2007
• Frequency of fast casual orders in past month
  • Figure 52: Frequency of fast casual orders in past month, by gender, July 2007
  • Figure 53: Frequency of fast casual orders in past month, by age, July 2007
  • Figure 54: Frequency of fast casual orders in past month, by HH income, July 2007
  • Figure 55: Frequency of fast casual orders in past month, by race/ethnicity, July 2007
• Usage of fast casual restaurants, by type
  • Figure 56: Weekend dinners eaten at restaurants and retail in past month, by gender, July 2007
• Attitudes Towards Fast Casual Restaurants
• Summary
• Attitudes toward fast casual restaurants
• Cross-tabbing by frequency of fast casual use
• Attitudes toward fast casual
• Enjoyment of cuisines, by type of cuisine
• How consumers discover the restaurants they frequent or plan to visit
• Beverage choices and preferences
• Eating and dining out habits
• Restaurant preference factors
• Attitudes towards food and dining out
• Reasons for not eating at fast casual restaurants more often
• Attitudes toward fast casual restaurants
  • Figure 57: Attitudes toward fast casual restaurants, by gender, July 2007
  • Figure 58: Attitudes toward fast casual restaurants, by age, July 2007
  • Figure 59: Attitudes toward fast casual restaurants, by HH income, July 2007
  • Figure 60: Attitudes toward fast casual restaurants, by race/ethnicity, July 2007
• Cross-tabbing by frequency of fast casual use
• Attitudes towards fast casual
  • Figure 61: Attitudes toward fast casual restaurants, by frequency of fast casual restaurant visits, July 2007
  • Enjoyment of cuisines, by type of cuisine
• Figure 62: Enjoyment of various cuisine types, by frequency of fast casual restaurant visits, July 2007
• How consumers discover the restaurants they frequent or plan to visit
  • Figure 63: How respondents find out about nearby restaurants, by frequency of fast casual restaurant visits, July 2007
• Beverage choices and preferences
  • Figure 64: Attitudes toward beverages, by frequency of fast casual restaurant visits, July 2007
• Eating and dining out habits
  • Figure 65: Eating and dining out habits, by frequency of fast casual restaurant visits, July 2007
• Restaurant preference factors
  • Figure 66: Factors to restaurant decision-making process, by frequency of fast casual restaurant visits, July 2007
• Attitudes toward food and dining out
  • Figure 67: Attitudes toward food and dining out, by frequency of fast casual restaurant visits, July 2007
• Reasons for less frequent use of fast casual restaurants
  • Figure 68: Reasons for less frequent use of fast casual restaurants, by gender, July 2007
  • Figure 69: Reasons for less frequent use of fast casual restaurants, by age, July 2007
• Future and Forecast
• Future trends
• Room for growth
• Fast, casual, small and authentic
• Top chefs jump on fast casual
• Expanding the box and diverting the palate
• Outreach and efficiency through takeout, catering and technology
• Commodity prices may pose price point hurdles
  • Figure 70: Whole chicken spot price, Georgia docks, by month, January 2006-June 2007
• Market forecast
• Leading fast casual chains
  • Figure 71: Forecast of total U.S. systemwide sales of leading fast casual chains, at current and constant prices, 2006-08
• Forecast factors
• Appendix: Trade Associations