A Deeper Dive

Why are consumers less responsive to restaurant marketing right now?This week’s episode of the Restaurant Business podcast A Deeper Dive features Robert Byrne, director of consumer and industry insights with Technomic and a regular podcast guest. We wanted to talk with Byrne about the general state of the industry, mostly because we had this question: Why isn’t anything working?Over the past couple of years, restaurant chains have unleashed more promotions at customers than ever before. They are introducing record numbers of limited-time offers. They have more technology. And the number of deals available to consumers is at record levels. Even fast-casual chains that never before had to push lower prices are doing so.Byrne is an expert on consumer behavior and we talk extensively about what is driving consumers away from restaurants. We discuss consumer concerns about inflation and what they’re thinking when they dine out. In short, consumers’ motivation is a lot different than it was not that long ago.It’s a great conversation on this week’s A Deeper Dive so please check it out.  

David Portalatin, Senior Vice President and food industry advisor at Circana, dives into the rising trend of deal-seeking among consumers. He reveals that a staggering 29% of restaurant visits are now perceived as bargains, the highest since the Great Recession. The discussion highlights how inflation and higher prices are driving this behavior. Portalatin also examines how consumer needs differ between convenience and experience, and how deal types have evolved to include digital offers and loyalty promotions that cut through the noise.

Why did PJ’s Coffee dramatically cut back on its menu items?This week’s episode of the Restaurant Business podcast A Deeper Dive features David Mesa, the president of PJ’s Coffee of New Orleans. PJ’s has 200 locations and is growing at a healthy clip. Mesa joins the podcast to talk about the company’s rebranding.PJ’s is leaning into its New Orleans heritage with that rebranding, including its menu. Mesa provides the details but here’s one interesting nugget: The company dramatically pared down the number of food items from “hundreds” to 18. We talk about a wide range of other issues, including the state of the beverage sector, which is growing at a very rapid clip. We talk about how PJ’s fits.We also talk about development and the barriers to growth PJ’s is experiencing, including interest rates and competition.We’re talking coffee and beignets on A Deeper Dive so please check it out. 

Rich Shank, a Senior Principal at Technomic, brings his expertise on the restaurant industry's current landscape. He highlights the uneven performance across sectors and emerging concerns regarding consumer spending. With nearly 30% of diners relying on discounts, he delves into the evolving nature of deal-making and the challenges faced by brands like Starbucks. Shank also discusses the impact of demographic shifts and labor availability on future growth. Tune in for an insightful look at the dynamics reshaping the dining experience.

What goes into an investment into one of the country’s fastest growing restaurant brands?This week’s episode of the Restaurant Business podcast A Deeper Dive features Scott Romanoff, the cofounder and co managing partner of Franchise Equity Partners.Franchise Equity Partners is a long-term investor in multi-unit operators of all types and recently made a big investment in 7 Crew, a 50-unit franchisee of the rapidly growing beverage brand 7 Brew. The beverage chain has been one of the fastest-growing restaurant chains in the country. It is also helping to lead a beverage revolution in the restaurant space. We wanted to ask Scott about that investment and about 7 Brew. We discuss the brand and why it was worth the investment. Scott talked about the operator and why its ability to grow locations was so attractive. We also discussed the environment of the past couple of years and why that’s made Franchise Equity Partners more choosy about its investments. We’re talking 7 Brew on A Deeper Dive so please check it out.

Are restaurants missing a key opportunity on delivery?This week’s episode of the Restaurant Business podcast A Deeper Dive features Cameron Watt, the CEO of secret shopper firm Intouch Insight.Intouch recently completed an exclusive study on delivery for Restaurant Business and we’re chatting about some of the conclusions. We caught up with Cameron at the recently concluded FSTEC conference.The study featured some fascinating results. For one thing, first-party delivery on average isn’t much better, performance-wise, than it is ordering from third-party delivery companies themselves. That may be a missed opportunity for restaurants. Cameron and I talk about that.We also talk about the growing influence of third-party delivery companies and the overall results from the study. And we talked about what restaurant companies can do to improve the delivery experience for customers. We’re talking delivery on A Deeper Dive so please check it out.

Why is McDonald’s taking on the tip credit? This week’s episode of the Restaurant Business podcast A Deeper Dive takes a hard look at the fast-food giant’s stand on the tip credit, which enables businesses to pay a subminimum wage to tipped workers, so long as the tips make up the difference. We feature three guests on this podcast: Saru Jayaraman, the president and cofounder of the labor advocacy group One Fair Wage; Martin Murch, an independent restaurant operator out of Chicago, and Joe Kefauver, managing partner of Align Public Strategies and cohost of the Working Lunch podcast. (Working Lunch also looked at the topic last week.)We examine the tip credit, why McDonald’s and labor groups are against the wage and why many full-service restaurants believe they need it to remain in business. We also examine McDonald’s strategy in taking the topic on, and why it would choose to leave the National Restaurant Association over the issue. We also examine whether it really does give full-service restaurants an advantage. We’re taking on the tip credit on A Deeper Dive so check it out.

What is the country’s fifth largest pizza concept doing to expand its reach?This week’s episode of the Restaurant Business podcast A Deeper Dive features Tom Brennan, the chief merchandising officer for the Iowa-based convenience-store chain Casey’s.That is right. Casey’s is the fifth-largest pizza concept in the U.S., at least based on sales. This is a fascinating conversation with a top executive of a company that is a growing competitor with a number of different restaurant chains, including much of the pizza business. We talk about that pizza business and how it became so vital to the company. Casey’s has been generating strong pizza sales this year even as fast-food pizza chains have been stagnant. Tom explains the company’s secret.We also talk about the company’s broader foray into the food business and we also talk about beverages and how Casey’s plans to improve its sales in that area. We’re talking convenience store pizza on A Deeper Dive so please check it out. 

Why are some restaurants having such a tough time this year?This week’s episode of the Restaurant Business podcast A Deeper Dive features Chad Moutray, the chief economist for the National Restaurant Association. We wanted to talk with Chad for two big reasons: First, the association published its data abstract on the restaurant industry, which shows some surprisingly low profitability for both full-service and limited-service restaurants. We talk about why restaurants are less profitable today compared with before the pandemic.But we also talk about the economy and why it’s so unfriendly to fast-food restaurants in particular. Many fast-food chains are seeing weak traffic, which has some speculating that lower-income consumers are cutting back. Moutray helps clear that up.We’re talking about the restaurant economy on A Deeper Dive so please check it out.

What is Todd Penegor doing at Papa Johns?This week’s episode of the Restaurant Business podcast A Deeper Dive features Todd Penegor, who has been CEO of the Atlanta-based pizza chain for just over a year. This is a great conversation. Penegor has helped Papa Johns regain sales momentum during a particularly difficult time, both for the sector and the fast-food business in general. The company has done this through a variety of means. We talk about the company’s focus on its core pizza. Todd talks about that effort, and he gives some hints at what may be coming. We talk about technology, including artificial intelligence, and the work being done on that front. We talk about loyalty. And we talk extensively about third-party delivery, and how Papa Johns can maintain its first-party service even as aggregators take more delivery business away.We also talk about marketing, and especially local marketing. Papa Johns has worked to shift marketing back to local after moving that spending nationally under the previous management.We’re talking pizza on A Deeper Dive so please check it out.