Breakfast: New Opportunities to Grow Sales

NRA Panel: Written Responses

The American Egg Board recently presented and sponsored a discussion at the National Restaurant Association Restaurant, Hotel-Motel Show titled Breakfast: New Opportunities to Grow Sales.  Featuring Michele Schmal from The NPD Group/CREST®, Stan Frankenthaler Culinary Director of Dunkin' Donuts, Courtney Parks from Open City and moderated by Steve Solomon, National Accounts Director of AEB, the panel presented pertinent data about the breakfast daypart as well as key insights from the panelists.

Following you will find interesting statements about the profitability and trends in the breakfast daypart.

1. Procuring breakfast away from home, regardless of where it is ultimately consumed, is much more habitual than other meals.
   
   Response: Michele Schmal, of The NPD Group/CREST reports - “But a difference with morning meal is personal loyalty. I wanted it; it was a treat for myself; it is a place I really like; I regularly or always go there.“
   
    
2. QSR breakfast tends to be a solitary meal for adults; it is often purchased through the drive-thru on the way to work, therefore much less likely to be impacted by others' input.

Response: “Michele Schmal, of The NPD Group/CREST reports – “So it is very much a personal choice and much more so than other day parts where people may be accommodating others. So there is a lot of personal loyalty and again that goes into that habit issue.“ 

 

3. The financial ability to treat ourselves is diminished during a tough economy, but small indulgences like breakfast away from home are needed more than ever to assure us that everything is really okay.
   
   Response: “Michele Schmal, of The NPD Group/CREST reports – “Morning meal has helped to drive that quick service growth. It is a less expensive daypart. It has got a very strong value proposition and value is really key to consumers right now.“ 
   
    
4. Tough economies also bring a need for comfort foods, but that need is not relegated to the morning, so some QSR chains offer all-day breakfast.
   
   Response: Courtney Parks of Open City comments – “…we are in the business of telling people yes. Yes, you can have that. We do not – we stay away from I am sorry, that is not available. Yes, you can get that. If you want pancakes at 9 o'clock, yes, you can get that. It gives a reason – it gives people a reason to come back more often because they have more choices if you offer – if you have that full menu available all the time, that is more reason to come back at any hour. So, yeah, it works quite well for us.“ 
   
    
5. Nearly 50% of all foodservice breakfasts are eaten in the car or at work, and 17% are being taken home to consume.
   
   Response: Michele Schmal, of The NPD Group/CREST reports – “…we also see a lot of portability issues that are very important with morning meal. At work it is 21% of the market. People are consuming it in the car 28% of the time, almost as big as on-premise. So the importance again is to have portability; the need for a breakfast sandwich or some kind of handheld item to round out your breakfast offerings. 17% of the time people eat their foodservice breakfast at home, which I find just amazing. People leave their house, they go, they get breakfast, they come back and they eat it at home. And that is also a growing market. We never want to underestimate the American's need for convenience.“ 
   
    
6. Consumers continue to demand “healthy” food, but the real issue is having the choice of better-for-me foods that taste good.
   
   Response: Stan Frankenthaler of Dunkin” Brands comments – “It is definitely pushing innovation on the side of taste, texture, cravability, in those healthier choices, and I think you see that more and more. And it is why culinary is so important in bigger companies and in manufacturing, right, because I mean for a long time we have been able to science (develop) certain health foods or items that are healthier choice. But are they cravable? I mean have they really made you want to repeat? Right? I mean we need to – our business is about repeat, frequency, occasion. So I think definitely on the innovation side our push is no trade down in quality, experience, customer excitement. And then the second I would say is portion size, sort of offering that moderation. It might be an indulgence item but then in a moderated portion…” 
   
    
7. Consumers see eggs as a familiar and satisfying food, while chefs appreciate their great versatility and creativity.
   
   Response: Courtney Parks of Open City comments –“Eggs are a great vehicle for introducing new ingredients to people who may not otherwise try them. You can sort of present things that you want to try, things that you want to get out to your customers, and present them. If you surround them with eggs, then it immediately makes it more familiar to people, which makes all those other ingredients a little more accessible. And that is how we do it. I mean we use eggs as a vehicle.“ 
   
    
8. As strong as the QSR breakfast segment growth has been, per The NPD Group/CREST only 11.5% of our breakfasts are purchased away from home, leaving a huge untapped market.
   
   Response: Michele Schmal, of The NPD Group/CREST reports – “I do think innovation is very important across the industry right now. Consumers really like to respond to new things. Even though breakfast is a very habitual kind of event, consumers like the excitement of trying something new, especially something very affordable and new even at a time when you are not feeling so great about things. So I think it is a great opportunity, a great time to look at some innovation. A new twist on old favorites, is often a good prescription for this day part.“ 

 To read an executive summary, click on “Breakfast Profitability”.