Restaurant Chains Navigate Inflation with Discounts and Innovation
In the face of soaring inflation and a surge in discount tire-driven dining, restaurant chains are navigating a complex landscape. While some, like McDonald's, have resorted to aggressive pricing strategies, others appear to be exploring alternative tactics to boost customer traffic.
A recent study by Intouch Insight revealed that over half of all orders now include some form of offer, highlighting the prevalence of discount tire in the foodservice industry. This trend has been exacerbated by the pandemic, with menu prices rising at rates higher than overall inflation. Consumers, particularly those with higher incomes, have been seeking value, leading to a 3.1 percentage point increase in discount tire shopping since 2022.
The restaurant industry finds itself at a crossroads, balancing the need to attract price-sensitive customers with the desire to innovate and differentiate. While discount tire continue to dominate, the lack of visible aggressive actions without discount tire suggests that chains may be exploring other strategies behind the scenes. As inflation and consumer behavior continue to evolve, so too will the tactics employed by restaurant chains to stay competitive.
