Off-premises purchasing channels thrive post-pandemic

Gen Zs and Millennials are anticipated to drive changing consumption patterns that will impact sales over the next five years.

Off-premises channels in the foodservice sector, including delivery, takeaway, and drive-through, have not only recovered from the impact of the COVID-19 pandemic but also expanded, according to Euromonitor International’s Decoding Channel Preferences in Consumer Foodservice report.

The report also said that on-premises consumption has not yet rebounded to 2019 levels in terms of global value in USD.

As per the Euromonitor Voice of the Industry Survey 2023, about 57% of global foodservice professionals expect changing consumption patterns, driven by Gen Z and Millennials, to impact sales over the next five years.

“Younger generations are increasingly spending more time online, especially after the pandemic,” the report said.

Factors such as remote work or hybrid work arrangements, increased online socialisation, and informed decision-making through digital tools are influencing these consumers. 

Additionally, the global inflation rate of 4.9% expected in 2024 is prompting consumers to be more cautious with spending, seeking better value for money when dining out.

Online ordering and off-premises consumption are on the rise, often accompanied by discount coupons, savings on commuting costs, and competitive prices from virtual restaurants or dark kitchens with streamlined operations.

Amidst the growing prominence of other channels, eat-in dining is projected to remain the primary foodservice channel, accounting for around 55% of total industry sales in 2028. The shifting work patterns, alternating between office and home, are also reflected in restaurant consumption habits.

Takeaway and delivery currently hold the second spot as preferred channels. Delivery, however, is anticipated to outpace all other channels with a compound annual growth rate of approximately 10% from 2024 to 2028.

The report also noted that understanding consumer motivations for each channel is crucial for foodservice providers. On-premises dining is associated with social activities and taste experiences, whilst delivery focuses on convenience, discounts, and time-saving. Takeaway and drive-through options are also sought after for their convenience, especially when restaurants are busy or delivery times are lengthy.

ALSO READ: 'Buy online, pick up anywhere' gains traction from retailers, consumers

Moreover, consumers prefer having fewer apps on their smartphones that offer multiple restaurant choices, making brand loyalty a significant challenge. 

Whilst restaurants offer various loyalty programs, only 26% of global respondents participate, compared to 47% for grocery store loyalty programs, as per Euromonitor's Voice of the Consumer: Digital Survey, fielded March to April 2023. The main deterrent cited by 38% of respondents was the slow accumulation of rewards.

“To win in the delivery game, it is essential to evolve delivery platforms into holistic ecosystems,” the report said. “This entails going beyond mere convenience, actively engaging consumers digitally and adapting to the challenging economic landscape where consumers are financially constrained.”