Per a recent MSN poll, millennials are more interested in pizza and Mexican restaurant chains than burger and chicken joints. While fast food chains like McDonald’s and Burger King have dominated in the past, it’s pizza places like Domino’s and Papa John’s that now reign supreme.
Contributing to their success, pizza chains Domino’s and Papa John’s have become especially adept at using digital to drive product sales. Thanks to digital ordering, Domino’s sales reached $10.9 billion in 2016 — nearly double their sales in 2008. Meanwhile, burger chains like McDonald’s and Wendy’s have largely failed to capitalize on digital trends. As millennials favor intuitive, easy-to-use technology, restaurants that make the most of the power of digital may continue to find competitive advantage.
Curious to see what Gravy Analytics’ location intelligence might tell us about foot traffic trends at leading burger and pizza restaurants, we analyzed Q4 2016 and Q1 2017 attendance data for select fast food chains in the U.S. Here’s what we found:
McDonald’s, Burger King and Wendy’s all saw foot traffic declines in Q1 2017, with Burger King foot traffic down nearly 14%. McDonald’s sales in the U.S. grew by 1.7% in Q1 2017, while parent company Restaurant Brands International reported flat sales for Burger King. In contrast, Domino’s and Papa John’s saw foot traffic increases of 16% and 2%, respectively. This correlates with Domino’s reported U.S. sales increase of 10.2% and Papa John’s reported sales increase of 2% in Q1 2017. Pizza Hut foot traffic was down by 10% during a period in which Yum! Brands reported a 7% decline in Pizza Hut U.S. sales. Note that Pizza Hut, Dominos and Papa Johns are delivery-centric, so consumer foot traffic patterns differ from other listed chains.
Digital is clearly making an impact on the restaurant industry. Could location intelligence be the next source of competitive advantage? Quick service restaurants are already using location data for insights into their customers’ interests, affinities and lifestyles. For the first time, marketers can benchmark store performance against their competitors in near real-time – measuring relative foot traffic and customer engagement. Advertisers can also use these same insights to reengage current customers with timely promotions, or to target competitors’ customers with conquesting campaigns.
Foot traffic metrics for Q2 2017 are just around the corner. Stay tuned to see what happens next.
Gravy Analytics is a leading provider of location intelligence for brands, and monitors foot traffic trends for over 2000 retail, hospitality and restaurant chains in the U.S.
Interested to learn more about Gravy and location intelligence? Contact us today.