Canadian consumers are ready to continue supporting restaurants, but managing your margins and improving the customer experience are imperative.
By Tom Nightingale
Canadian food services and hospitality are finally on the road to healing the deep wounds of COVID-19. On July 16, indoor restaurants reopen in Ontario for the first time since Easter weekend, a historic summer reopening for an industry devastated by the effects of the pandemic.
Ontario is the latest province to reopen, and as customers begin to familiarize themselves with dining out across the country, operators need to know what they’re thinking and what they want to see in the summer of 2021 .
The group of fifteen, a leading hospitality consulting firm, recently surveyed consumers across Canada to assess how customers currently feel about returning to restaurants as we approach summer.
Customers happy to come back with some assurances
Reduced to the essentials, the investigation found reasons to encourage restaurateurs.
38% of those surveyed said they would look to dine indoors as soon as possible, while 34% said they would consider dining indoors under certain circumstances. Meanwhile, nearly half (46%) suggested they would end up eating in restaurants as much as they did before the pandemic.
David Hopkins, President and CEO of The Fifteen Group, said RestoBiz that his business is “optimistic” for the next six months and beyond.
“Restaurants are probably going to rebound in a big way,” Hopkins said. “We are already starting to see this in some markets. Even in Toronto, where only the patios have been opened to date, the response has been overwhelming. “
It was noted, however, that many consumers would seek certain assurances before returning to dining rooms. For example, as vaccination rates continue to rise, two-thirds (67 percent) of respondents said restaurant workers were a crucial factor in their decision to return or not to eat inside. , while a similar number (65 percent) supported vaccine passports for restaurants.
Price increases are a useful strategy
Throughout COVID-19, Hopkins has championed modest price increases to help restaurants mitigate the financial blow from the pandemic. While some restaurateurs may be reluctant to increase the cost to consumers, Hopkins says consumers have already shown they are willing to pay a little more.
“We found that a large number of respondents supported the price increases,” said Hopkins, citing the survey’s finding that 62% of consumers said they would support a menu price increase of 5 % or 10%. That number jumps into the 70 percent range when looking at high income earners. “All of this bodes well for what we have been telling our customers and the market about raising prices, recouping some of the losses and improving industry margins,” Hopkins added.
The desire to support restaurants is still burning
A significant silver lining to the horrors of the past 16 months has been the public’s desire to continue supporting small business. This has been evident across a number of facets, and one of them has been the willingness of consumers to continue ordering from local restaurants (albeit often through different methods) to ensure their community continues to do business.
In The Fifteen Group survey, 28% of consumers ranked the importance of supporting restaurants after COVID-19 as 10 out of 10.
“Basically a year and a half of the general public have heard how the restaurant industry has been affected and they are supportive of it,” notes Hopkins. “Consumers are responding to this: We’ve already had feedback from customers and the market as a whole that people spend well in restaurants and don’t hold back. They are enthusiastic. It seems the average checks are higher and people splurge a bit more. “
Hopkins acknowledges that there is a risk that the spending increase is a short-lived measure, an exuberant response from people who have been “locked in for a while,” as he puts it. But all signs are positive for the future. While there is some hesitation from part of the population – primarily, as expected, the elderly or otherwise at risk – people generally seek out days or evenings, the experience of dining in a restaurant.
“I always feel like we’re going to go back to our old ways pretty quickly,” Hopkins says. “Even give those who are hesitant right now three or four months without hearing about COVID-19 every day in the news and they’ll likely forget about it pretty quickly. Even the most ardent supporters of containment are done with it. There is only a limited time you can keep a very social animal locked up.
Take-out meals to continue to thrive
While these are findings that Hopkins said were visible for some time during the pandemic, the investigation drew a strange surprise.
COVID-19 has seen a huge spike in offsite order adoption and consumption, and that is to be expected. Things were already in fashion before the pandemic, and through COVID-19, it was necessary with the dining rooms closed. Other factors are also at play, including the proliferation of convenient choices for the consumer following a period of rapid technological innovation on the operational side of the industry, during which many restaurants have accepted orders in. online or mobile apps for the very first time.
While Hopkins notes that it is not in itself surprising that delivery and takeout will continue to represent a larger percentage of sales in 2022 than in 2019, he was shocked to find that more than half ( 52%) of those surveyed said they intended to continue ordering. takeaways at the same level as they were during the pandemic, even with the reopening of dining rooms. “I thought it would be like 5%, the size of that proportion surprised me,” he adds.
This can pose a challenge for some establishments, especially high-end restaurants, whose modus operandi revolves around a high-quality menu and a refined customer experience. It’s incredibly difficult to replicate via delivery – food cools or deteriorates in transit and the experience of the dinner value proposition is lost, which can affect a restaurant’s branding and reputation. .
For Hopkins, take-out isn’t necessarily for everyone in the industry.
“We now hear that restaurants have to deliver, that’s the way of the future, but while high-end restaurants could do it if it suits them, they have to. right: make it exactly representative of their brand and their experience. It’ll be a tough decision, but some restaurants can still benefit from recognizing that delivery doesn’t represent them and what they do. “
A new level of customer experience
Ultimately, in a world where parameters have changed, especially when it comes to health, safety and consumer confidence, delivering a high customer experience is more important than ever. Hopkins describes the current climate as a huge opportunity for restaurants to “reset the bar”.
Operators need staff training, need to make sure their menus are 10 out of 10 and that disinfection procedures are all underway, he says. Historically, restaurants have always tried to keep labor costs low. Now, however, the priorities are somewhat different and restaurants must reallocate some of the extra margin from price increases to training and staffing to ensure the customer experience is high.
“Guests are coming back, they are definitely looking for a great experience,” Hopkins sums up. “When you haven’t been to a restaurant for a year and you feel like it, you remember good dining experiences. Can’t remember averages or most crap. This is what restaurants need to create now.
Essentially, the entire customer experience now plays a role in health and safety. A satisfied customer is likely to feel safe and comfortable in a restaurant environment; if the customer experience is poor, they may start to doubt health and safety protocols.
“There is a real direct link between a high customer experience and making the customer feel comfortable with their health and safety proposition in your restaurant,” concludes Hopkins.
This summer is a pivotal moment on the road to recovery. For traders, it’s time to familiarize yourself with current market and consumer demands, and prepare for success.