Seasonal LTO | KRG Hospitality

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November 14, 2023by David Klemt David Klemt No Comments

Peppermint is the Latest Flavor Superstar

Peppermint is the Latest Flavor Superstar

by David Klemt

Just when you think you have a handle on seasonal flavors, along comes the latest and greatest demand from consumers: peppermint.

Perhaps it’s because pumpkin spice shows up earlier each year. Maybe it’s because that hit of frosty peppermint hits the nostalgia button.

It could be as simple as consumers thinking:

pumpkin is for fall; and
peppermint is for winter.

Regardless, it appears that people are turning their attention to peppermint.

Of course, that doesn’t mean that pumpkin and pumpkin spice are out of favor completely. A recent trip to a grocer with shelves devoid of pumpkin butter and other pumpkin spice flavors show me people are still snapping it up.

And no, it wasn’t a product shift; staff says those products are flying out the door after each restock.

Instead, I think people are just ready for the next thing. In this case, the next flavor thing. And that flavor, it seems, is peppermint.

Considering that pumpkin spice LTOs appeared in early August this year, it makes sense for many consumers to want something new. After all, they’ve had four months to indulge their pumpkin and pumpkin spice cravings. That’s a third of the year.

Peppermint on the Rise

When delving into F&B and hospitality trends I tend to look at Datassential and Technomic. Both are credible, reliable sources of information.

However, I’m turning to another source, Tastewise, to dive into pumpkin spice and peppermint. For the unfamiliar, Tastewise is an F&B insight platform that uses artificial intelligence to collect real-time consumer behavior data.

First up, pumpkin spice. According to Tastewise, the flavor is up nearly 75 percent in terms of social conversations in 2023. Additionally, four percent of restaurants in the US have pumpkin spice items on their menus. That may not sound like a lot, but that’s more than 33,000 restaurants.

Now, let’s look at peppermint. Per Tastewise, social conversations about this frosty flavor are up almost 22 percent this year. However, peppermint liqueur conversations are up just over 77 percent.

Interestingly, according to Tastewise, peppermint items are on almost eight percent of menus in the US. That’s more than 67,000 restaurants, over double the amount of pumpkin spice.

One note: peppermint is not the same as mint. While peppermint is trending (most likely due to seasonal shift), mint is down nearly 109 percent. So, not all mint flavors and items are equal. This seems particularly true at the moment.

Takeaway

Is everyone on social media, talking about food? No, of course not.

It’s important to note, though, Tastewise’s current market overview. At the time of publication, Tastewise is scanning:

8,151,698 people on social media;
57,220,294 social media posts;
937,070 restaurants;
136,278,759 dishes; and
5,878,416 recipes.

Operators can and should take industry insights with a grain of salt. Not every fad, trend or item works for every operator and concept.

However, it’s important to know what consumers are talking about and posting to social media. Being a part of some conversations can be a boon for an operator and their bottom line.

So, if introducing a peppermint LTO (or LTOs) will appeal to an operator’s guests—because they take the time to understand them and track their menu item sales—and works with their concept authentically, they should consider becoming a part of this conversation.

Image: Shutterstock. Disclaimer: This content was generated by an Artificial Intelligence (AI) system.

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August 28, 2023by David Klemt David Klemt No Comments

Pumpkin Spice Everything is Already Here

Pumpkin Spice Everything is Already Here

by David Klemt

In what perhaps is an attempt to encourage people to think of cooler autumnal temperatures, pumpkin spice is descending upon us earlier than ever before.

Operators who are finalizing their pumpkin spice menu items are basically already late to the party.

Luckily, it isn’t like the brands for which fall’s most infamous LTO flavor works are too far behind. A significant percentage of consumers are drawn to pumpkin spice menu items like trick or treaters to homes handing out full-size candy bars.

So, operators still have time to put the final touches on pumpkin spice menu items…but they’ll want to get a move on.

That’s exactly what restaurant chains did this year. Their pumpkin spice-flavored onslaught began with the start of this month.

Pumpkin Spice, Now a Summer Flavor?

Spirit Halloween stores. Christmas music. And now, it appears, Pumpkin Spice.

What do these three things have in common? Well, it seems like they’re making their debuts earlier and earlier each year.

When we think of summer and seasonality, I don’t think pumpkin or even baking spices enters into most people’s minds.

Unless, however, those people are in marketing and branding.

According to Restaurant Business, Krispy Kreme went all in on pumpkin spice on August 7. On that day, the chain unveiled four donuts and a number of beverages featuring pumpkin flavors.

Interestingly, the company’s global chief brand officer, Dave Skena, states that their pumpkin spice releases came one day earlier this year. Last year, they say, pumpkin spice arrived “significantly earlier than the year before.”

7-11 may have crossed the pumpkin spice dateline first this year. Dunkin’ is already offering pumpkin spice F&B items. And Starbucks, famous for their PSL LTO, is rumored to be launching their specialty menu this Thursday.

Given these August releases, can we expect a brand to attempt to get the jump on everyone else and launch pumpkin spice LTOs in July?

Consumer Cravings

Brands wouldn’t gamble on releasing their pumpkin spice LTOs in August if they didn’t think their decision would pay off.

Considering what Krispy Kreme’s Skena says about pumpkin spice’s August arrival, consumers have already spoken. Apparently, a significant percentage of people have an interest in fall flavors midway through summer.

Of course, there are a few considerations for independent operators in terms of seasonal releases. Rolling out new menus and menu items can be a costly endeavor. Pulling the plug on one revenue-generating seasonal menu or LTO in favor of significantly different items may be harmful to the bottom line.

One approach operators could take is to plan far enough ahead to pull the trigger on LTOs when 7-11, Dunkin’, or Starbucks launch theirs. In other words, be ready, but don’t jump the gun.

This also speaks to the importance of operators knowing their core guests and listening to feedback. Are front-of-house staff hearing murmurs from guests that they’re craving new flavors? Perhaps it could be lucrative to leverage that anticipation.

Image: Colton Sturgeon on Unsplash

March 10, 2023by David Klemt David Klemt No Comments

Reduce Discounts, Increase Profits

Reduce Discounts, Increase Profits

by David Klemt

There’s reason to be optimistic about generating revenue this year but operators must also be savvy if they want to boost their bottom lines.

Put another way, the growth some industry organizations and experts are predicting isn’t just going to occur. We’re optimistic about 2023 as well, but it’s going to take hard work and shrewdness.

As we know now, the National Restaurant Association is forecasting massive sales this year. In fact, the NRA projects the foodservice industry will generate $997 billion in sales. That’s nearly a trillion dollars just from the foodservice space.

Clearly, that’s a big number. It’s also $60 billion more in sales than the industry generated in 2022. That’s impressive in and of itself, surpassing the 2022 sales forecast by almost $40 billion.

Okay, so those are a lot of big numbers. Should foodservice outperform the forecast again, the industry will pass the trillion-dollar mark. And I know every owner and operator, be they independent, chain or franchisee, wants a healthy share.

However, impressive as those numbers are, they’re just that: numbers. Operators will still have to do the work to increase traffic; convert first-timers to repeat guests; and increase revenue. Fail in those tasks and there’s no reason to expect profits to rise.

It’s math, after all, not magic.

One way operators can increase revenue and profits is to offer fewer discounts. Really, this isn’t an incredible concept: If more guests pay full price, operators see more profits.

Real-world Example

Costs are up nearly across the board, and it can be tempting to offer discounts in an attempt to increase traffic. However, one group has shown over the past couple of years that discounts don’t need to be an operator’s go-to traffic- and sales-boosting tactic.

Carrols Restaurant Group is a Burger King franchisee. According to Restaurant Business, the group operates more than 1,000 Burger King restaurants. So, they operate approximately one out of every seven Burger Kings in the US.

Last quarter, Carrols managed to generate more than $14 million in free-flow cash. That’s higher performance than the group has seen in the past couple of years.

A significant factor for Carrols and Burger King is backing off of discounting. Again, this isn’t groundbreaking but it’s still noteworthy. A brand that once was reliant on discounting is now backing off that model and seeing dividends.

Of course, guest perception, the guest experience, and marketing play a role. Guests must still feel they’re getting value for the dollars they spend. They must also feel that their experience, from QSR to full-service, shows that they’re valued by the restaurant. And the marketing messaging must truly speak to a brand’s guest base and bring them through the doors to spend their money.

Premiumization over Discounts

The bottom line for an operator’s bottom line is this: If prices are continually discounted, that lower price is now the actual price. At least, a discounted price is now the normal price in the eyes of guests.

In other words, an operator who discounts all the time is training their guests to only visit and buy items when prices are lower than usual.

The superior option? Offering premium LTOs that speak to a brand’s base and tempt them to spend more. LTOs don’t need to come with discounted prices. In fact, they should be treated as premium promotions and command premium prices.

Create seasonal LTOs (in one concept’s case, inventing a fifth season), as an example, to generate buzz and increase traffic. Offer premium items at premium—but fair—prices to leverage the traffic, increase sales, and boost profits.

Another strategy that’s more effective than discounts? Building a brand with which guests resonate. Guests who relate to a brand tend to visit more often and support it with their dollars.

It’s tempting to discount. Don’t give in to temptation.

Image: Karolina Grabowska on Pexels