Deal-based spending grows in Q1 as Aussies seek budget-friendly meals
Combos and upsized meals were popular and contributed the most to growth in the quarter.
Amidst economic uncertainty, Australians have sought budget-friendly deal-based meals within the foodservice industry, The NPD Group’s latest CREST data showing that deal-based occasions grew 12% in spend and 7.5% in traffic in Q1 when compared to the same time last year.
Non-deal occasions declined in traffic but grew 3.1% in spend.
“The rise of deal-based spending and traffic can be linked to the current economic climate and the fact that consumers are wary of spending their money in times of uncertainty. Much of the growth in spend can be attributed to the increase in raw materials driving the price of goods up,” explained Gimantha Jayasinghe, senior vice president and deputy managing director for Asia Pacific at The NPD Group.
“While some consumers are happy to pay more for items, it’s natural for many consumers to seek occasions where they can save money at the same time as enjoying meals that they haven’t had to cook themselves,” he added.
As prices continue to climb due to supply chain challenges and costs of raw materials increasing, the insights agency said consumers are faced with looking for dining alternatives that are easier on the wallet yet still allowing them to partake in foodservice dining occasions.
In the first quarter, deal-based occasions helped growth in retail foodservice traffic and spend, whilst non-deal occasions saw only declines. Combos and upsized meals were popular and contributed the most to growth in the quarter.
Morning meals drove industry growth within all foodservice channels, with breakfast being the only meal time to grow in traffic compared to the same time last year, as well as in Q1 2020 and Q1 2019 (at a rate of 10.7%, 8.9%, and 10.3%, respectively).
Breakfast, coffee, and morning snacks continue to be effective for local cafes as Australians venture out of the home for their morning meals.
All dayparts, except for lunchtime, experienced an increase in spend when compared to the same time last year.
“The drop in spend for the lunch daypart can be attributed to consumers aged 34 years and younger, and on-premise dining. Drive-thru, delivery, and pick-up saw strong gains in the lunch daypart, but they were not enough to offset the declines in carry out and on-premise dining,” adds Jayasinghe.
