The Spend on Dining Out Hit an All-Time High – Are You Poised to Take Advantage

A few short years ago we were in the middle of the recession. Bargain hunters turned to low-cost grocery chains and became amateur extreme couponers to save a few bucks on their trip to the store. Going out to dinner…well that discretionary spending was cut pretty badly.

The result was an industry in peril. Restaurants and the entire hospitality industry was hit extremely hard. Some went out of business while others needed to make drastic changes to save thin profit margins.

But times, they are a changin’!

According to data recently released by the Commerce Department, sales at restaurants and bars overtook spending at grocery stores for the first time ever this past March.


What caused the increase in dining out spend?

There are several factors coming together that helped to fuel this increased spend on dining out, instead of brown bagging it.  Here are a few thoughts:

Better economy.

With a healthier economy there is less worry and risk. People are more willing to spend discretionary income on things they enjoy, instead of continually saving for a rainy day.

Spending shift.

Behind “Dwellings” and “Vehicle Purchases,” food away from home made up the biggest share of income spend — above clothing/apparel, personal services, cell phones and more.


This powerful group (ages 25-34) is now taking over where the baby boomers left off.  They dedicate an even bigger portion of their income to food away from home.

Social Interaction.

Millennials view going out for drinks and dinner as their social event. Instead of simply food, it is now a form of entertainment and social engagement–a way to connect with friends.


How can restaurants collect a bigger piece of the pie?

While overall spending is up, that doesn’t immediately mean that every restaurant will prosper. So what can you do to make sure that your restaurant sees the windfall from this increased spend? Here are a few tips:

Cater less to baby boomers.

A recent Gallup survey showed that the baby boomers percentage spend on dining out is decreasing. The 51-69 year old demographic are now spending more of their money on groceries and less on dining out. Millennials on the other hand are increasing their spend. The hospitality industry should make note and think about catering to this younger demographic.

It’s less about fine dining.

As The National Restaurant Association points out, millennials favor a quicker food experience like deli’s or pizza restaurants instead of high-end dining.

Get social.

Dining out is more of a social experience for millennials – restaurants need to embrace this both physically and virtually. Venues that offer a warm and engaging atmosphere will become more attractive to this powerful demographic. Additionally, restaurants that embrace social media trends will increase awareness. Leveraging social sites like Facebook, Instagram and others will help engage with more people, increase visibility and connect on a more personal level. Something like installing a Facebook beacon can help guests connect more personally and see what their friends have experienced in your establishment.

Get reviews.

Extend your social reach into Yelp, TripAdvisor, Facebook reviews and more. Guests are becoming more selective and one tool they use with more frequency than ever is the social review. If you have a limited number of reviews or a few bad reviews, patrons may be scared away. Take a proactive approach to building more positive reviews for your business (here’s how).

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