Fast Casual Restaurants Find Success in Boosting Alcohol Offerings

Fast Casual Restaurants Find Success in Boosting Alcohol Offerings

We all know that fast casual restaurants are the bright spot of the foodservice industry.

So it’s no secret that both quick service and casual dining restaurants are green with envy given fast casual’s continued success – and as a result, are trying to steal a page from fast casual’s book by offering higher-quality menu options, modifying service styles and launching fast casual spinoffs.

This has left fast casuals searching for new ways to differentiate their brands.

The result: better-for-you, made-to-order concepts are pairing with another overarching trend  – alcohol, which is especially popular among Millennial consumers (a key demographic for fast casual restaurants).

In fact, 20% of Millennials agree that it’s important for restaurants to serve alcoholic beverages.

Alcohol isn’t just an attractive menu option for Millennials, however. It also appeals to other demographics – at least one third of all consumers say that alcoholic beverages at a restaurant influence their decision to go there.

And research suggests that the consumption of adult beverages at restaurants is not only connected to higher levels of overall visit satisfaction and longer-term customer loyalty, but it also increases consumer willingness to return to that restaurant.

Of consumers who ordered an adult beverage at a restaurant, 42% said that “they strongly agree that they will return to that restaurant in the near future.”

Simply put, adult drinks are becoming a competitive differentiator and are eliminating the veto vote, in which diners choose not to eat a certain restaurant because it doesn’t serve alcohol.

The X Factor

Only 26% of all limited service restaurants offer any type of alcoholic beverage. This means that fast casual operators who have adult beverage options – whether that’s beer, wine, or a full bar – are going to separate themselves from the pack.

Uncle Maddio’s Pizza Joint, for example, does 24% of its business in alcohol sales and customizes its beer selections to specific markets to match customers’ preferences. And Blaze Pizza estimates that sales of beer and wine boost top line sales by 5% - 7%.

So not only can adding alcohol to the menu serve as a point of differentiation, but it can also result in tremendous increase in profits and attract customers to the dinner daypart, which is the holy grail for fast casual operators.

The Challenge and The Solution

Despite the benefits that adding alcohol to menus brings, it isn’t necessarily the right fit for every operator.

In order to launch an alcohol program successfully, fast casual operators need to work hard to know who their customers really are and those customers’ preferences.

By leveraging customer data, it’s possible to create unique customer profiles based on the customers within the trade area of each individual restaurant location. This in turn can allow operators to understand what their customers want, which beverage offerings would be most appealing and which restaurant locations would prosper most with the implementation of an alcohol program.

Furthermore, a complete 360 view of your customer will also help operators create seamless strategies in terms of pricing, targeted promotions and additional menu offerings.

The bottom line is that the fast casual operators who know what their customers want and can provide the experience customers desire will have the greatest opportunity to grow.

Want to find out how customer analytics can help your brand come to the table with a competitive edge? Pull up a chair and find out.