QSRs Look to Data Scientists for Menu Change Insights

For menu change insights, some quick-service restaurants (QSRs) are not looking to food scientists but to cold, hard numbers.

QSRs have been caught between a rock and a hard place as consumers pull back their overall spending. On one hand, price anxiety has driven consumers toward QSRs as restaurant prices outpace grocery inflation — a behavior change detailed in PYMNTS’ “Digital Divide: Restaurant Customers React to Rising Costs, Declining Service.”

Double-digit shares of consumers across demographics — from 12% of baby boomers and seniors to 19% of millennials — are saying they are leaning away from establishments with higher prices and now prefer restaurants more focused on value. This could, theoretically, mean that QSRs are well-positioned to handle the new economic landscape.

On the other hand, however, this focus on value leaves QSRs little maneuverability in absorbing increased supplier costs, as 62% of consumers notice these price bumps —negatively. The reliance on QSRs providing the cheapest food has left a declining share of consumers saying they were “highly satisfied” with the price of their last QSR meal. Full-service restaurants have so far not seen similar declines, perhaps due to expectations of these restaurants’ prices being higher.

As detailed in The Wall Street Journal in May, some QSRs are turning to data to find the balance in raising menu prices without alienating their customers. Using both internal and competitor data, franchisees such as those from San Francisco-based Flynn Restaurant Group are examining sales numbers for individual items as well as traffic in other area QSRs. Although outfits such as Flynn can afford their own data metrics team, for smaller organizations, providers such as Toast are now offering tools to assist in menu pricing.

In an interview with PYMNTS published in January, Tim Hackbardt, chief marketing officer of Del Taco, detailed some of the issues QSRs face when considering menu changes.

“The most common pitfalls are lack of quality, portion size, flavor, variety and price,” he said. “The majority of the brands we see that still have value menus miss on all these metrics, especially the quality and variety.”

He added that variety is key to these menus’ ability to “drive frequency of visits,” keeping consumers from getting bored of the offerings.

With no end to cost-cutting on the horizon, QSRs may continue to be the go-to for many consumers’ meals. These establishments may have the opportunity to get out of tight revenue spaces using some help from data.