The State of the Industry – The “R” Word, Hygge, and You

By now I’m sure you’ve heard it: yes, the ‘R’ word, recession. Maybe not for the rest of the economy, but for our sector a downturn is supposedly looming.

Some reports scale it as more of a slowdown (Nation’s Restaurant News, 2017) – after all, sales figures are still projected to rise- but the overall growth is stymied by less frequent diner visits and slower expansion plans from most large franchises.

So what do you have to do with the changing patterns in our market? To understand the changing consumer, I think we should take a step back from within the industry and look at how our own habits have changed. Have you taken advantage of the plethora of new prepared food options at the supermarket? Have you tried a meal-in-a-box delivery service? Or have you noticed the falling food prices at the grocery store (down 1.7% over the last year, per the NRA’s Restaurant Economic Snapshot, Feb 2017) and simply been cooking at home more? Though U.S. consumers still say they enjoy eating out, the numbers point to them doing so less frequently, and being more conscientious about their options when they do. In fact, the NPD Group’s latest website headline says it all: ‘Why Staying in Is the New Going Out’. Their research backs it up, too: out of all dinner meals purchased in restaurants, nearly half are eaten at home. That’s great for the takeout and delivery sectors- but what does it mean for dine in?

This is where that funny word in my title comes in – hygge (pronounced hue-guh) refers to a Scandinavian lifestyle concept of comfort, coziness, and staying home with family. It’s been a driving force in the past year of retail design, and coincides with consumers being on tighter budgets ever since the Great Recession of the late 2000s. Hygge culture is definitely influencing a shift the restaurant industry is undergoing in order to retain and grow business. Overall spending is still on the rise, so restaurants have the opportunity to grab their share if they can tap into the current sentiment. Some of the tactics I see companies employing, enhancing the guest experience through remodels and improving overall service, definitely reinforce that hygge feeling – but is that enough? Since menu prices have risen 2.6% over the last year (The Washington Post, 2017), combating the ‘stay at home economy’ takes a lot more than a flashy LTO or spokes-mascot to draw the customers in.

Where can we look for inspiration on ways to help this slowdown speed back up? The NRA Show is coming up soon, and many of us are thinking about what we can get out of the industry’s largest trade show. I’m really interested in what I’ll see – I’m expecting the majority of the buzz to be around hot new menu items and restaurant equipment. But what I’m most curious about are new ideas that might help make diners more willing to part with their hard-earned dollars. I’m going to walk the show with a split personality and take in not only what is valuable to me as a marketer for a foodservice supplier, but what interests me as a consumer influenced by the current trends. Let’s see if anything gives me that warm, fuzzy hygge feeling and makes me want to spend money (away from the comfort of my couch, that is).