As the hardest-hit meal occasion in the early days of lockdowns, breakfast went from a daypart increasingly expanding its reach into an all-day affair to a shrinking violet. In some cases, menus and restaurant hours were pared back because many people simply weren’t going out to restaurants to buy breakfast items — morning or night.
“Much of [the morning] daypart is based on people grabbing something on the way to somewhere else. And, of course, when we were all locked down, we weren’t leaving our homes and didn’t have to grab something on the go,” elaborates Vince Sgabellone, Foodservice Industry analyst at The NPD Group in Toronto.
However, he’s quick to note, “It was also the first [daypart] to start recovering, because Canadians love their morning meal. They love their breakfast sandwiches; they love their coffee.” And this has resulted in morning customer traffic rebounding to its pre-pandemic levels, despite other activity levels not yet reaching this peak.
In spite of an expanded hybrid work and work-from-home culture, Sgabellone shares anecdotal evidence that consumers are making it more of an occasion when they do have to leave the house for work. As he explains, the mindset has become: “‘It’s something special now because I’m only out of my home once a week,’ so they’ll make a point of going [out] for that breakfast occasion.”
“We’re seeing people return to some of their routines,” agrees Liz Geraghty, Chief Marketing Officer, International, The Wendy’s Company, “which has re-ignited the desire for convenient, on-the-go breakfast options.”
Beyond the return of ‘on-the-way’ breakfast customers, Sgabellone notes NPD data indicates a surge in breakfast traffic at full service. “A lot of this is coming from families,” he explains. “It looks like more families are using breakfast — and FSR breakfast in particular — as another opportunity to get together.”
Main Attraction
Driven by the on-the-go nature of breakfast, the star offerings on many menus are breakfast sandwiches. As Katie Belflower, associate editor, Technomic, points out, breakfast-sandwich offerings are among the top growth items within the daypart, according to Technomic Ignite Menu data.
“The fastest-growing breakfast dishes over the past year include sausage breakfast sandwiches (up 28.6 per cent), veggie breakfast sandwiches (up 27.3 per cent), starch add-ons (up 25 per cent) and egg sandwiches (up 23.5 per cent),” she shares.
And, as Sgabellone notes, the popularity of the breakfast-sandwich platform is leading to offerings that span beyond the traditional sausage-and-egg or bacon-and-egg sandwiches. This may include a variation on the featured protein or the introduction of new flavour profiles.
This makes sense given that, as Sgabellone shares, “Breakfast sandwich [sales] didn’t really fall all that much during the pandemic and they’re [already] back in growth mode again.” Plus, “It was one of the fastest-growing items leading into the pandemic,” he adds.
Looking to Wendy’s new Canadian breakfast menu, Geraghty points to the Breakfast Baconator and Sausage or Bacon Croissant sandwich among emerging favourites. The Breakfast Baconator in particular represents a more unique take on the breakfast sandwich, featuring a burger patty, cheese, a fresh-cracked egg, applewood-smoked bacon and a warm Swiss-cheese hollandaise sauce.
Last year also saw the introduction of Tim Hortons’ lineup of Maple Bacon Breakfast Sandwiches, featuring “bacon topped with a sweet and savoury glaze,” as well as the Harvest Breakfast Sandwich and Harvest Farmer’s Wrap made with plant-based Impossible Sausage.
McDonald’s Canada has also brought new limited-time offerings to its breakfast sandwich lineup over the past year, including the Chicken BLT McMuffin and the Bacon, Egg & Jalapeño Cheddar McMuffin and Egg & Jalapeño Cheddar McMuffin, which featured creamy jalapeño sauce and marble cheddar cheese with jalapeño.
While the breakfast sandwich may be the headliner on many a morning menu, diners in both Quebec and Ontario frequently turn to baked goods to fuel their day, according to data from DoorDash Canada. On a list of Ontario’s most-ordered items, bagels claimed sixth place. And in Quebec, croissants ranked fifth.
Further, according to DoorDash’s Canadian edition of the 2022 Restaurant Online Ordering Trends report, baked goods were the most widely ordered delivery and pickup item in Canada between January and March of 2022. The report also highlighted the “most popular cuisines in Canada cities,” pointing to bakery items as the most ordered category in 12 Canadian cities.
“Pastries have grown 3.4 per cent on breakfast menus over the past year,” Belflower shares, noting croissants, muffins, dessert breads and scones as the top breakfast pastries.
Looking beyond on-the-go items, Belflower points to data that reveals: “Top breakfast dishes include eggs Benedict/Florentine, breakfast platters, eggs any style, crepes/blintzes and pancakes entrees.”
As with much of the breakfast category, these bases are ripe for elevated takes and innovative flavour infusions. “The fastest-growing flavours at breakfast over the past year include pesto (up 50 per cent), passion fruit (up 35 per cent), matcha (up 25.8 per cent), Latin American (up 20.3 per cent) and chorizo (up 19 per cent),” Belflower shares. “Several of these are global flavours, reflecting a greater industry trend of global dishes, flavours and ingredients showing growth on menus.”
This can be seen in menu items such as Sunset Grill’s Guacamole Brunch Sandwich LTO, which featured a sausage patty, melted cheddar cheese, two eggs, guacamole and Tabasco Original Red Sauce on a toasted brioche bun, served with home fries and veggies.
There also seems to be a push toward more decadent offerings, such as indulgent pancakes, waffles and crepes. For example, Quebec-based franchise Pür & Simple offers Red Velvet pancakes with raspberries, sweet cream cheese, raspberry coulis, whipped cream and fresh mint. The Ontario-based Stacked Pancake & Breakfast House chain also serves up a number of ‘Signature Stacks,’ such as White Chocolate Oreo Pancakes, Chocolate Chip Cookie Dough Pancakes and Birthday Cake Pancakes.
Competitive Landscape
Breakfast is an important category within Canadian foodservice, and that breeds stiff competition.
As a result, when Wendy’s threw its hat into Canada’s highly competitive QSR breakfast market it didn’t do so lightly. Fully aware of the competitive sphere it was about to enter, Geraghty explains that the brand took the time to properly prepare for the endeavour.
“We spent two years researching and preparing to ensure we would deliver the breakfast Canadians deserve. We conducted preliminary research to identify consumer perceptions of QSR breakfast competitors, their breakfast habits, menu research, forecasting and led sensory studies to fine-tune our menu items for Canadians. We also conducted a full data analysis to understand QSR breakfast trends and opportunities in the market, along with a test of 15 different menu concepts with more than 3,700 Canadian consumers to ensure we had the insight to create the best breakfast experience possible.”
The resulting menu features a sustainably sourced custom coffee blend, seasoned potato wedges and a lineup of breakfast sandwiches, featuring breakfast rolls, buttermilk biscuits and croissants. There’s also the recently launched Homestyle French Toast Sticks.
We’ve seen evidence that established players in the space have been feeling the pressure of this competitive market, too. In 2021, Tim Hortons began launching a series of quality improvement initiatives across its breakfast menu, which has included the introduction of freshly cracked eggs; a crispier, naturally smoked bacon; and new English Muffins, biscuits and hash browns. The brand also opened 2023 with the launch of its TimSelects value breakfast menu, which features three offerings under $3.
Outside of the quick-serve environment, the degree of competition may not be quite as fierce. Though differentiation remains a key consideration.
There has been growth surge in recent years amongst breakfast concepts offering an experience that goes beyond the basic greasy spoon/diner-style breakfast fare. Brands such as Pür & Simple have seen significant expansion and Stacked Pancake & Breakfast House has also seen notable growth, with locations opening in Alberta and more than 20 new Ontario locations in the works.
OEB Breakfast Co. is another example. With more than a decade of serving up an elevated breakfast experience under its belt, the Calgary-born brand has recently been extending its reach to include locations in five provinces, as well as two U.S. states. Its specialty fare includes items such as the Artisan Bagel Sammy, made with Artisan bagel, two free-run eggs over hard, white truffle mayo, chunky guacamole, micro watercress and served with fresh fruit; and the Canadian Lobster & Shrimp Crepe, featuring butter-poached lobster and shrimp scramble, green onions, brown-butter hollandaise and truffle pearls.
Although competition will continue, the future looks bright for breakfast. “It’s the fastest-growing daypart this past year, despite all the growth that we’ve seen across the day,” says Sgabellone.
And, given the current environment, it’s not unlikely that the industry will see this continue through 2023. “A silver lining to the COVID black cloud is more families seem to be dining out together,” Sgabellone notes. “[Breakfast] is still also very affordable …so it’ll possibly benefit from the fact that we’ve got these economic headwinds facing us. If people do want to cut back on their foodservice spending, but not necessarily on their foodservice visits, that could benefit the smaller dayparts like those morning meals.”
BY DANIELLE SCHALK
