In today's world, where inflation is becoming a growing concern, Americans are smartly navigating their socializing habits. More people are flocking to restaurants during happy hours, balancing their desire to reconnect post-COVID with the need to manage their wallets. Here's an insight into this trend, drawn from new data by InMarket.
Happy Hours, Happier Pockets
Amidst the inflationary trends, Americans are now rediscovering the joy of happy hours. Freed from the COVID-19 constraints and with an ever-conscious eye on rising prices, many are choosing early evenings to relish discounted food and drinks
This behavior is underscored by the latest research from InMarket, pointing to a surge in restaurant traffic between 4 to 7 p.m., especially in the second quarter when juxtaposed with last year's data. InMarket, basing its research on mobile location data from over 200 million consumers, observed a weekday jump of 9% and a weekend surge of 13% at casual dining spots. Limited-service establishments noted an even sharper climb, with traffic up by 20% on weekdays and a whopping 25% on weekends.
Despite a generally stagnated traffic trend in the dining industry over the past year, especially for full-service outlets, there's a clear shift towards earlier dining. As Michael Della Penna, InMarket's Chief Strategy Officer, put it: “4 o’clock is the new 7 o’clock.”
Driving Factors Behind the Trend
This change in dining patterns can be attributed to several causes:
Post-Pandemic Socializing: The post-pandemic freedom has revived the spirit of community. Americans are relearning the joys of public socializing, providing a boost to places like restaurants that facilitate such interactions.
Remote Work Lifestyle: The widespread adoption of remote work has effectively replaced commute hours with leisure time. This change in routine allows many to commence their evenings earlier.
Inflation and Value Hunt: With prices on an upward trajectory, consumers are on the lookout for value. Special offers, early bird prices, and promotions during early hours are now more enticing than ever.
Many eateries have recognized this trend and are tweaking their strategies. Notable names such as Chili’s, Applebee’s, Taco Bell, and Hardee’s have recently promoted happy hour specials. Fleming’s Prime Steakhouse and Red Robin have introduced discounted menus for early evenings, while P.F. Chang’s launched a happy hour menu to mark its 30th anniversary.
Such initiatives are proving fruitful. For instance, Olive Garden's Never-Ending Pasta Bowl promotion last autumn led to a significant rise in guest counts, helping the brand perform remarkably well in terms of industry traffic.
However, the challenge for restaurants lies in balancing traffic with profits, especially when discounts usually mean reduced earnings. As a result, many are adopting a dual pricing strategy, promoting both budget-friendly and premium items.
With inflation on the rise and consumers becoming more price-sensitive, the resurgence of happy hour culture is a testament to the adaptability of both businesses and their patrons. It's a reminder that even in challenging times, there are always opportunities to find balance, value, and joy.