With more options for dining out on the humble burger than ever before, many UK consumers will be heading out to celebrate National Burger Day (Thursday 27th August). To mark the occasion, Mintel’s expert analysts take a look at how leading players globally are evolving in line with increased consumer expectations of burgers and fast food in general.

helena-childeHelena Childe, Senior Foodservice Analyst, UK

Home delivery represents a particularly interesting potential growth area in the fast food market as operators look to create additional revenue streams in a mature eating out market. In the past, the price sensitivity of fast food users has dampened operators’ inclination to compete in the home delivery market. This price sensitivity has raised some concerns about the news that Burger King is now running a trial of a home delivery service at selected sites in the UK, given that the minimum value required for orders is reportedly £14. However, with three new combo meal deals for multiple diners also on offer exclusively to delivery customers, the convenience of this service should have potential to appeal to families if not budget-conscious individuals. According to Mintel’s forthcoming Burger and Chicken Restaurants UK 2015 report52% of those who have eaten in or have bought a takeaway from a fast food restaurant or outlet in the last three months say they would be interested in ordering home delivery from a fast food restaurant chain, rising to 60% of 16-34s.

Better food in informal settings is another key concept gathering speed across various areas of the eating out market, as the casualisation of eating out continues. It is this increased level of competition and raised consumer expectations which is having a knock on effect on the chicken and burger bar segment with a number of key players trialling new store interior designs in recent months (such as KFC in the UK and Burger King in Europe). In the past, 12% of adults aged over 16 have stated that unappealing dining areas (such as shabby decor) have put them off using fast food venues (see Mintel’s Burger and Chicken Restaurants UK 2014 report).


analyst-image-circleCaleb Bryant, Foodservice Analyst, US

Burger restaurant competition is fierce—both among quick-service and gourmet operations. Their menus are evolving while their burger descriptors are getting juicier. Delivery service is the next burger frontier, as many of the major burger brands have begun testing delivery in major metropolitan areas.

All it will take is for one burger chain to figure out how to effectively do delivery, and it’s game on for everyone else. It’s been a quiet ride in the burger-delivery front seat for the chain—until recently. In May, McDonald’s started offering delivery in New York City in a partnership with the online delivery platform Postmates. McDonald’s didn’t jump in to compete with Burger King so much as to compete with Chipotle, which only a few weeks earlier started offering delivery via Postmates.

The potential problem area for delivery is cost. According to Mintel’s The Online Foodservice Consumer US 2015 report, consumers are willing to pay an average of $3.19 in delivery fees for a total bill of $10 or less. Postmates currently charges a delivery fee of $5 with an additional 9% service fee, meaning a $5.99 Big Mac Meal suddenly surpasses $11.50. However, the company announced a goal to accomplish $1 delivery fees for high-density zip codes during peak dining times. If this low fee can be achieved it could potentially be a game-changer for burger delivery.

The move to delivery is a play by Quick Service Restaurants (QSRs) to attract Millennials. Taco Bell has been in the forefront of QSR delivery and according to the CEO Brian Niccol, “We have to appeal to the taste and spirit of Millennials—who want access to anything they want, when they want.” Mintel research found that 32% of all respondents report using online food delivery services more than once a month. However, 53% of Millennial respondents use these services more than once per month making them the prime target for delivery services.

 

Helena Childe is Senior Foodservice Analyst at Mintel. Helena is responsible for the UK Foodservice journal at Mintel, providing robust market coverage, in depth consumer research, analysis and strategic recommendations for the restaurant, pub and bar market. Helena regularly presents to clients as well as at industry and press events and frequently contributes towards articles published in the trade press, covering a wide number of foodservice topics.

 

Caleb Bryant is a Foodservice Analyst at Mintel. Caleb joined Mintel with previous foodservice research experience and boasts a background in research methodologies. He authors reports focusing on changing consumer attitudes, foodservice industry news and flavor and ingredient trends within the category.

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