Restaurant sales positive in May despite slower growth

Overall, May 2022 was a good month for restaurant sales. The expected slowdown in sales growth continued thanks to last year’s sales figures – which were impacted by COVID-19 vaccines and the reduction in pandemic restrictions. Both triggered pent-up demand in the market, creating today’s tough selling hurdles. Month-over-month, sales growth figures were flat, remaining at levels that would have been considered robust in the pre-COVID era.

Sales growth was +4.9% in May, down slightly from the +5.3% recorded in April. These high sales figures are due to the accelerated growth of guest checks. The biggest concern is traffic, which posted its third consecutive month of negative growth. Traffic growth was -2.9% during the month, down slightly from the -2.8% recorded in April. But even these negative traffic growth numbers are not far off from what was happening at the end of 2019. The months of the fourth quarter of 2019 showed an average traffic growth of -2.0%.

While maintaining customer numbers is a current challenge, data suggests it may be due to factors beyond the restaurant’s control. Reports indicate that customers are more positive about their experiences at the restaurant than they were a year ago. At the same time, the operators seem to deliver on their promise of a good dining experience, especially when it comes to service.

According to online reviews, net customer sentiment* for the restaurant service improved nearly six percentage points year-over-year in May. Additionally, net positive service sentiment has increased year-to-date compared to 2021 – with May posting the third highest service sentiment since January 2021.

Net food sentiment was virtually flat year-over-year in May. Last year, food sentiment was also strong. May 2022 recorded the second highest net food sentiment scores in the past 17 months.

*Net sentiment is the percentage of positive mentions minus the percentage of negative mentions in online restaurant reviews.

Financial metrics are “same store” metrics and reported on a one-year comparison unless otherwise noted

Much lower ratings for full-service off-premises orders, smaller difference in limited service

When it comes to restaurant reviews data, one thing is very clear, but not unexpected: diners tend to rate their restaurant experiences as more positive when dining out than when consuming their food or their drinks outside. What’s surprising is how small the audience difference between these two channels is for limited-service restaurants.

For full-service restaurant brands, the average star rating (based on a five-star scale) in Q2 2022 was 4.0 when tied to a dining experience. While the average rating fell to 2.8 when referring to the exterior. That is a substantial drop of 1.2 points between the two channels.

The main factors behind lower off-premises ratings for full-service brands are generally related to longer wait times and problems with orders. There was a higher percentage of negative mentions of time-related issues (“wait,” “minutes,” and “long”) in off-premises reviews than for on-site dining. There was also a higher rate of mentions based on a specific issue with the order – things like ‘cold’, ‘bad’ and ‘forget’, as well as fewer mentions of the food being ‘delicious’ in off-orders. site.

In the case of limited service restaurants, the average star rating overall was low and the difference between the two was small. The average limited-service dining experience led to an average rating of 2.8 stars, compared to 2.4 for off-premises orders, a drop of just 0.4 points. The limited service sees a predominant share of business through offsite channels. As a result, they are generally able to perform more consistently despite offsite challenges. But this month’s low overall rating suggests there are still challenges ahead – and ones all brands should consider as an opportunity for improvement.

In the case of limited-service restaurants, the most significant factor in the drop in off-premises rating compared to dining was the wait time for orders, with “waiting” being mentioned in off-premises reviews 1.4 times more often than in those for restaurant orders.

Regional and market performance

There is no doubt Florida led in May based on the major metro areas with the most positive net restaurant sentiment. The designated market area with the strongest sentiment based on service, drinks, ambiance and intent to return was Tampa, while the most positive for food and restaurant value was Orlando.

Besides Orlando and Tampa, which topped the list for the most positive net food sentiment, the other major markets in which restaurants achieved strong positive sentiment based on their food were Philadelphia; Raleigh, North Carolina; Indianapolis and Miami. These same DMAs led the country in net services sentiment during the month.

At the other end of the spectrum, customers are the least positive about their dining experiences in San Francisco. In May, San Francisco recorded the lowest net sentiment for food, service, value, and intent to return to restaurants.

The Restaurant Guest Satisfaction Snapshot™ (RGSS) is produced using data from Black Box Guest Intelligence™. Guest Intelligence compares customer satisfaction data from over 190 brands and is the only online tool that integrates with operational performance data to validate the impact on financial performance. The dataset focuses on six key attributes of the restaurant industry experience: food, service, ambience, drink, value, and intent to return.

The RGSS algorithm determines the top ranked brands based on sentiment. Brands included in this monthly snapshot must have a total of at least 250 mentions for the month. Restaurants must also have a minimum number of units to be eligible. DMA ratings only consider the 25 largest areas.

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