By Greg Stucky, Chief Research Officer, InsightsNow
While many industries have been hit hard by the fallout from COVID-19, the restaurant industry reached an estimated $145 billion in losses during the first four months of the pandemic. While recent months have seen a slight uptick in restaurant business as stay-at-home orders relax and restrictions are lifted across the nation, the long-term negative impact of this business interruption will continue for quite some time.
Creative solutions to impact bottom line
Even though restaurants have largely been allowed to reopen and limited in-restaurant dining is now permitted in most areas, there are strict capacity limitations and distancing requirements in place. When capacity to serve goes down, it is extremely impactful on the already narrow profit margins under which restaurants operate. Restaurants and cities have been coming up with creative solutions to support these businesses, like blocking off sidewalks and parts of city streets to expand the dining footprint (and allow outdoor seating).
Consumer behavior regarding restaurant visits
In a recent wave of our InsightsNow ongoing study, “COVID-19 Tracker on Clean Living Behavior,” we uncovered insights into consumer behavior regarding restaurant visits. The research delves into insights from our proprietary, trend-identifying Clean Label Enthusiasts® (CLE) consumer research community.
Our results show that the majority of people are still quite unwilling to go INTO a restaurant to eat. As time goes on and the weather stays mostly pleasant in many areas of the country, more and more CLE are willing to sit outside at a dining establishment—and even more willing to go through the drive-through of a fast food restaurant. However, sitting inside is not changing.
Consumer Trust in Restaurants
This avoidance of indoor seating is primarily driven by a lack of trust in the restaurants' ability to keep everything clean enough to prevent the spread of the virus. Some consumer quotes from our study illustrate the tension.
“Personally, I don’t think self-serve drink stations, touch screen kiosks and silverware wrapped in napkins are fully safe nor clean. How do we know that the person asked to wrap the silverware has washed his/her hands, wore gloves or even a mask? So many questions, so few answers.”
“I went to a restaurant recently and sat outside. Waitress was very cheerful, no wait and had a wonderful breakfast on real plates and used real utensils. Everything was very clean, and I really enjoyed it. I do think that you should be careful when going to restaurants though.”
“Individual packages seem to be safer than containers left on the table in which everyone at the table touched or breathes on. I am more concerned with the people who handle my food. Did they wash their hands? Do they live in a home with 10 or more people? I don’t trust others' hygiene routines compared to mine.’”
Combine this with the continual fear of being in less control of your own safety when inside closed rooms, and it is clear it will be quite some time before dining patrons are willing to risk sitting indoors to enjoy a meal at their favorite restaurants again, and we will see continued impact on the bottom line for restaurants across the country.
To learn more about consumer behavior regarding dining choices, view the recording of our recent webinar on Restaurant and Fast Food Behaviors: Sustainability Trade-offs during COVID.