Secret Sauce - The Restaurant Marketing Podcast · James Eling |Restaurant Marketing, Strategy and Tactics

Restaurant Trends for 2023

January 20, 2023·32 min·2 clips

The Federal Reserve plans to keep jacking up interest rates until enough people lose their jobs, impacting restaurant customers worldwide.

This episode features James from Marketing for Restaurants outlining his predicted top trends for the restaurant industry in 2023. He bases his analysis on macroeconomic factors, customer feedback, and technological shifts observed globally. The host draws from his postgraduate studies and work with restaurants worldwide to inform these independent forecasts. Inflation and rising interest rates are creating significant challenges for both restaurants and consumers, leading to reduced disposable income. Labor shortages persist in many countries, exacerbated by closed borders that previously supplied student and backpacker workers. The market is seeing less competition as some restaurants, particularly in the bottom 10%, close due to staffing issues and lack of profitability. Supply chain issues continue to affect ingredient cost and availability, though this varies by locality. The host shares a specific example of a local Indian restaurant that closed after 15 years, partly due to a non-functional website that hampered online ordering. He suggests that restaurant could have seen a 20-30% revenue increase with a working site. One major trend is a shift toward flexitarianism and away from strictly processed meat alternatives, signaled by Beyond Meat's falling share price from $250 to about $13. Diners are increasingly seeking vegetarian options that are healthier, cheaper, or driven by environmental concerns, with meat potentially becoming more of a treat. The delivery market is consolidating, with Deliveroo exiting Australia, and restaurants are exploring more profitable alternatives like customer pickup or in-house delivery. Reliability and cost are key issues, as rider shortages increase delivery expenses and decrease service dependability. A surprising insight is the prediction that drone deliveries will grow, with McKinsey & Co forecasting 1.5 million such deliveries in 2023, though temperature control for food remains a hurdle. The host suggests comfort food will see increased demand as it offers psychological consolation during economically fearful times, often at a high-profit margin. He notes that Domino's operates a highly profitable delivery model by incentivizing pickup through strategic pricing, a tactic others could emulate. The episode also posits that large chains like McDonald's may eventually bring delivery fully in-house, following Domino's successful example. The tone is educational and conversational, blending macroeconomic analysis with specific, actionable advice for restaurant owners. The style is direct and opinionated, drawing frequently on the host's personal observations and client interactions. This episode is ideal for restaurant owners, managers, or investors seeking a strategic overview of the year's challenges and opportunities. Listeners interested in the economic forces shaping the food service industry or specific operational shifts like delivery logistics would find it valuable. Those seeking a purely data-driven report without anecdotal examples or forward-looking speculation might prefer a different source.

As heard by us

A practical 2023 trend check that stays close to restaurant reality.

James treats episode 166 as a practical read on where restaurants were heading in 2023, and the strongest material stays with operator economics. Vegetarian options come up less as a lifestyle argument than as a response to price pressure and shifting spending habits.

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Why you'd press play

A straight-talk reset on where restaurant demand and delivery are heading in 2023.

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