Statistical data reveals that out of the over 1,800 consumers surveyed by PYMNTS in February, 44% of respondents noted that in the past year, restaurants have been offering fewer and less substantial discounts and perks.
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GLOAs food inflation continues to cut into restaurant profit margins, customers report an observed reduction in the extent of discounts and promotional offers available.
Statistical data reveals that out of the over 1,800 consumers surveyed by PYMNTS in February, 44% of respondents noted that in the past year, restaurants have been offering fewer and less substantial discounts and perks. This information comes from additional research included in the PYMNTS report titled “Connected Dining: Consumers Like the Taste of Discount Meals.” In contrast, 36% of participants reported that the offers have remained relatively unchanged, while 20% mentioned that the discounts have actually become more generous.
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Following the survey period, restaurants have consistently increased their menu prices, potentially causing a slight shift in these percentages at present. However, it remains evident that consumers have noticed a trend during this inflationary phase, with restaurants adopting a more cautious approach towards their promotions and offers.
Certainly, the casual dining chain Red Robin Gourmet Burgers, renowned for its presence across over 500 restaurants in the United States and Canada, divulged that it had been scaling back its discounting programs during an earnings call on August 17.
In this announcement, the company revealed its strategic decision to curtail its discount-oriented initiatives. Red Robin’s CEO, G.J. Hart, articulated the shift, stating, “We are making changes to [our loyalty] program, pivoting away from what we view as an overreliance on discounts, instead rewarding those who are truly most loyal to the brand. As we continue to make investments in our people and food, we intend to reduce our reliance on discounts going forward.”
Similarly, Brinker International, the parent company overseeing renowned dining establishments like Chili’s Grill & Bar, Maggiano’s Little Italy, and two virtual brands, made known its intention to minimize discount offerings to enhance cost management during its earnings call on August 16. CEO Kevin Hochman remarked on this strategic shift, saying, “We removed some discounting last year, a significant amount. We’re going to continue to remove discounting, probably at a slower pace. … We’re going to replace those emails with more relevant emails, and more of [them]. They are more relevant, [so] over time, you would expect to get more traffic from those, not less. It just wouldn’t cost you as much.”
Source: PYMNTS
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