Innovation has been a driving force in the QSR and restaurant category over the last couple of years, as brands have looked for more convenient ways to serve customers through digital ordering and pickup. Consumers are demanding smoother experiences, varied menu options and want to find QSRs wherever they are.
Food service prices increased 10% on average in 2022 due to high energy costs and an unstable global supply, according to the Foodservice Price Index from CGA and Prestige Purchasing. The study predicts that inflation is going to continue to impact the costs of food and drinks into 2023.
“Customers are going to demand more value next year than in years before as they see price increases on everything from their grocery bills to gas charges. However, as a marketer, value doesn’t always mean automatically ‘cheaper’ – it can mean ensuring your product offers something to the consumer that other brands in your category can’t do,” says Lindsay Morgan, chief marketing officer of Pizza Hut. “With wallets tightening across the country, marketers will need to strike a balance of reaching audiences in creative ways to grow brand love over time while really dialing in on how they are presenting direct value offers to the customer in real time that’s what will define the winners of 2023.”
Ryan Ostrom, chief marketing officer at Jack in the Box, says that since COVID, QSR has attracted a new audience that is willing to spend more on quality items. “We went from pure value to more higher end guests,” says Ostrom. “You’re going to get a lot of good quality, higher-end products, as well as value products on the other end. We have to have that balance between quality and value that are the driving forces behind QSR in the next year. But you have to then balance that with all the supply chain challenges. It’s about consistency in our business, making sure that when you come today, and you come next week, it’s the exact same product, that same taste, and meets the standards of our guests.”
Ben Miller, vice president of branding and creative strategy at CKE, agrees that the category is built on value and convenience. “As consumers continue to evolve their definitions of both, companies are going to continue to chase that evolution down whatever path presents itself,” he says. “The brands that succeed in that race aren’t going to be the ones that keep changing to meet the consumer demands of the day, the ones that succeed are the ones that know who they are and understand how to tailor those trends to fit their strategies moving forward.”
QSR brands will need to be available where consumers are, be it on DoorDash or UberEats, in order to meet consumers where they are. “QSR will continue to grow and evolve far into 2023 and beyond,” says Erin Levzow, vice president marketing of technology at Del Taco. “We will continue to evaluate AI and automation opportunities in our restaurants and I know we will see improvement here across the vertical. Customer expectations will continue to rise as well. Meeting them in the channel they want to order from will no longer be a nice to have but a must, so diversifying ordering channels will continue to be a focus.”
Digital channels will continue to play a key role in attracting customers and emerging channels like TikTok and the metaverse will be drivers in reaching key audiences.
“As we head into 2023, TikTok will continue to play an instrumental role in engaging with new and existing audiences digitally. At El Pollo Loco and within the QSR industry at large, brands are continuing to experiment with short form content that feels more authentic compared to the marketing campaigns of decades past,” says Andy Rebhun, CMO of El Pollo Loco. “The rise of TikTok has allowed brands to zero in on their unique voice and story and that is resonating with consumers effectively. El Pollo Loco witnessed firsthand the impact TikTok can have on sales through the launch of our Mexican Shredded Beef Birria LTO in 2022, and we are planning to continue to double down on the platform as we plan for some exciting new product rollouts in 2023.”
Morgan stresses that the battle for marketers to entertain, inspire and engage with the coveted Gen Z audience will continue.” Gen Z is even changing expected behaviors with how they search for information,” reflects Morgan. “It was reported this year that younger audiences use TikTok as a way to search for information vs. traditional search engine platforms like Google. Knowing this, in 2023, it will be key for marketers to identify how to truly integrate into the TikTok platform in an authentic way that the younger generation doesn’t peg as ‘fake’ or ‘overly promotional.’”
“For QSR, Gen Z continues to show us traditional behaviors like going out to dinner are starting to change – especially when everyone is looking for something to satisfy their own individual taste buds,” she continues. “In that place is the desire to have something more personal, and more unique when it comes to meal time options. Gen Z loves a snacking occasion – so it’s figuring out how marketers can grow with these new behaviors from above the line messaging to menu innovation.”
