A concept succeeds or fails based on whether its operator evolves the business to adapt to consumer demands, differentiates the brand and continues to innovate. What sounds simple is often quite complex and ever-changing. Consumer drivers that are impacting the growth of the Top 100 chains — and beyond — include demands for innovation with a focus on flavour and healthfulness, a variety of snack options that suit busy schedules and social lives, unique experiences and, of course, value.
Global flavours
Consumers seek new and bolder food, including global flavours. Some of the fastest-growing chains on the Top 100 (see p. 27) illustrate the rising influence of international cuisines. On one hand, there are the ethnic specialists, such as St. Laurent, Que.-based MTY Food Group Inc.’s Thai Express, Sushi Shop and Mucho Burrito. But Canadian restaurant operators of all stripes are livening their menus with flavours and preparations from around the world. Take, for example, the Kimchi Quesadilla recently added to the menu at Burlington, Ont.-based Canyon Creek. The starter fuses Asian and Mexican, layering prime rib with kimchi, cheddar and mozzarella in a flour tortilla with toasted sesame seeds and fire salt, served with sambal crema and pico de gallo.
The Toronto-based Fox & Fiddle incorporates assorted global flavours into its flatbreads: its Mediterranean features tzatziki sauce; its butter-chicken variety has savoury Indian butter chicken; and its pulled-pork version is sautéed in chipotle sauce and topped with Korean barbecue sauce.
Many Top 100 chains are innovating with Mexican favourites. Vancouver-based Joey Restaurants offers Asian-inspired tacos with ahi tuna, seared rare, with toasted sesame, ginger coleslaw and wasabi aioli. The pulled-pork barbecue trend finds Mexican expression in Vaughan, Ont.-based Taco Bell Canada’s new Pulled-Pork Quesadilla. Surrey, B.C.’s Abc Country Restaurants gave diners a new way to enjoy the comfort-food classic, roasted beef, in 2013 when it debuted a half pulled-beef quesadilla as part of the chain’s Comfort Menu. And Denny’s now offers a Bacon Avocado Burrito with crispy bacon, two scrambled eggs, a smoky cheese blend, freshly made pico de gallo and chipotle sauce in a flour tortilla, grilled and served with hash browns.
And, in February, Toronto-based McDonald’s Restaurants of Canada introduced the Spicy Thai McBistro Chicken Sandwich. A new Asian-inspired addition in 2013 was Vaughan, Ont.-based Kelsey’s Asian Chicken Noodle Bowl, with sautéed chicken, red onions, portobello and button mushrooms, red peppers, bok choy, broccoli, garlic and Asian broth on a bed of marinated Shanghai noodles, topped with fresh basil, cilantro and lime.
New Definition of Health
Today’s consumers are defining “healthy” more broadly, adding descriptors such as “organic,” “sustainable” and “fresh” to the list of already recognized terms such as “low-fat” and “low-calorie.” Forty-two per cent of Canadian consumers polled for Technomic’s “2013 Canadian Value & Pricing Consumer Trend Report” said they would be more willing to buy — and pay more for — items described as “fresh,” one-third (32 per cent) said the same of “local,” and approximately one-quarter said the same of “natural” (27 per cent) and “organic” (25 per cent).
Recognizing the demand for such “better-for-you” descriptors, leading restaurant companies have continued to add menu items that boast these attributes (Vancouver-based White Spot, for instance, describes its Lifestyle Chicken Burger as using fresh char-grilled British Columbia chicken breast served with artisanal greens); brands are even building concepts around “better-for-you” descriptors. (Think: Toronto-based Hero Certified Burgers and Brantford, Ont.-based Williams Fresh Cafe.)
Last year, Oakville, Ont.-based Tim Hortons introduced the first coffee to be sourced solely through its Coffee Partnership, part of an eight-year initiative that was created to support coffee farmers in Latin America. The debut of the exclusive coffee is one accomplishment in a series of initiatives aimed at promoting sustainability and social responsibility. Two of Tim Hortons’ top coffee competitors, McDonald’s and Starbucks, similarly have extensive sustainability initiatives.
Snacks and Snacking
Technomic’s “2014 Canadian Snacking Occasion Consumer Trend Report” finds snacks are three times as likely to be sourced from retail food outlets such as grocery stores or convenience stores as from restaurants. This is a challenge many Top 100 chains are apparently willing to take on. And it’s worth noting that some of the fastest-growing chains — Ajax, Ont.-based Smoke’s Poutinerie, Markham, Ont.-based Yogen Früz and California-based Menchie’s Frozen Yogurt — are snack specialists.
Vaughan, Ont.-based Harvey’s offered Warm Funnel Cake Fries, served with raspberry sauce, for a limited time. Winnipeg-based Chicken Chef features a Chicken Finger Snack, highlighting three breaded chicken breast strips served with a choice of one side and a dipping sauce. And Wendy’s Bacon & Cheese Sauce Potato, with creamy cheese and hickory-smoked bacon on an oven-baked potato, is promoted as “the just-right choice for lunch, dinner or a late-night snack.”
Smoothies are a popular snack and a popular vehicle for menu development, too. Burger King introduced Strawberry Banana Smoothies, made with yogurt and real fruit, and debuted limited-time-offer (LTO) Tropical Mango Smoothies. And McDonald’s Canada expanded its Real Fruit Smoothies lineup with the addition of a strawberry mango orange variety, also an LTO.
Full-service chains are rolling out creative snacks as well. Burnaby, B.C.’s Red Robin Gourmet Burgers offers warm soft-pretzel bites served with beer cheese dip, while Kelsey’s has a garlicky baked artisanal pretzel bread topped with a blend of four cheeses. Meanwhile, Markham, Ont.-based Pickle Barrel’s Barrel Fries are smothered in a creamy cheddar and mozzarella sauce and topped with applewood-smoked bacon bits, sour cream and green onions.
Consumers often enjoy small plates and starters as snacks, and leading operators are providing plenty of innovative options. At Vaughan, Ont.-based Milestones Grill + Bar, the starters/shared plates menu features yam frites and a cheesy garlic loaf, quinoa-crusted shrimp “served on a bed of fresh summer slaw,” and a Mediterranean bruschetta that tops a warm flatbread with feta cheese, Roma tomatoes, wilted arugula, fresh basil and a balsamic reduction.
Social Experiences
Milestones’ menu suggests pairing its crispy quinoa shrimp with its Corona Lime Mojito. Making pairing recommendations on the menu can draw attention to an operator’s beer, wine and cocktail selections and help get the party going for various social occasions for which out-of-the-ordinary starters are tailor-made.
Shared plates lend themselves to social occasions, too and can be promoted to help operators position themselves as an ideal location for fun group outings after work or on the weekend.
Several Top 100 brands are ideal for socializing, thanks to their fun atmosphere (think Vaughan, Ont.-based Shoeless Joe’s) or focus on a high-end experience (such as at Vancouver-based Browns Socialhouse).
Not surprisingly, the industry is seeing an increase in consumer desire for better food, service and overall experience without a significant increase in price. The trend has driven the success of fast-casual concepts on the limited-service side of the industry. Along the same vein, upscale-casual-dining restaurants — those with a more contemporary, adult-focused atmosphere and menu than traditional casual-dining restaurants, with meals typically priced at $20 to $50 — will fill the bill on the full-service side.
Unique experiences can also be found in limited-service concepts within the Top 100. Menchie’s lets customers craft their own frozen yogurt with as many toppings and flavours as they choose, and it boasts a family friendly atmosphere with a neighbourhood feel. The Oakville, Ont.-based The Works Gourmet Burger Bistro focuses on providing guests with a fun, family friendly dining experience, playing loud rock ‘n’ roll music. And Vancouver-based A&W takes guests back to a simpler time in the ’50s.
Value is Key
The preceding trends are driving customer purchases and consequently increasing restaurant growth. But regardless of whether a consumer is seeking a unique experience or a better-for-you meal, value is key. In fact, 87 per cent of consumers polled for Technomic’s “Canadian Value & Pricing Consumer Trend Report” say value is either important or extremely important to them when deciding which restaurant or other foodservice location to visit.
Price promotions and dollar menus point to a chain’s value positioning. Among the Top 100 chains promoting value last year were McDonald’s Canada, which offered its limited-time Two-Can-Dine promotion for $9.98; Burlington, Ont.-based Dairy Queen Canada, which introduced a limited-time $6 Meal Deal with a choice of a chicken wrap, a three-piece chicken strips basket with dipping sauce or a deluxe cheeseburger, served with fries, a small sundae and a medium drink; and Moncton, N.B.-based Scores, which offered six dishes (Traditional Chicken Brochette, Tender Chicken Breast Fillets, Speckled Trout, Chicken and Bacon Focaccia, Hunter Chicken and Thai Chicken Salad) at a special price of $10 each for a limited time.
Loyalty or rewards programs also add value for many consumers, a fact that many leading chains have taken advantage of recently. For example, Vancouver-based Denny’s in Canada launched MyDenny’s, a program that includes mobile rewards, exclusive offers and a social-media platform. Users can earn points for every purchase and redeem them for food and beverages. The points can also be sent through MyDenny’s to friends and family to be used at any participating Denny’s location. The social aspect of MyDenny’s allows users to invite their friends to meet them at a Denny’s location.
For its part, Toronto-based Pizza Pizza partnered with Toronto-based technology company Givex to launch its new Club 11-11 loyalty program. Customers who enrol receive a card that allows them to collect a 10-per-cent credit on every purchase made at Pizza Pizza restaurants. Dubbed Pizza Pizza Dough, the credit is automatically loaded onto the card, separate from any pre-loaded cash. After 11 purchases, the earned credit from the previous 10 purchases is unlocked for redemption.
Promoting loyalty programs and other items that create a perception of value while providing offerings that speak to consumer demands for high quality, innovation and unique experiences, will enable chains within the Top 100, and those smaller concepts fast on their heels, a chance to maintain and grow their share of industry sales.
Mary Chapman is the director of Product Innovation at Technomic Inc., a Chicago-based foodservice consultancy and research firm. She can be reached at [email protected].
