MRM Research Roundup: Catering, Kiosks, Tipping and Dry January

11 Min Read By MRM Staff

In this edition of MRM Research Roundup, we feature news about an influx of catering orders, the topic of tipping, the rise of kiosks and affordable Michelin restaurants. 

Q4 Restaurant Trends

Toast released its Q4 2023 Restaurant Trends report that examined catering activity around the holidays, large events, cold-weather food and alcohol preferences, and weekly tipping trends. 

Among the highlights:

On or Off Prem

  • Same-store catering transactions increased +71 percent in Q4 2023 compared to Q4 2022. Of that increase, 30 percent came through Catering Online Ordering, which launched in Q3 2023. On average, catering orders ticket sizes in Q4 2023 were $160.
    • Generally speaking, Tuesdays (+25 percent) and Wednesdays (+26 percent) are the busiest days for catering orders.
    • Catering orders also saw a significant bump the week before Thanksgiving and a steady build-up during the first three weeks of December. On Friday, November 17, there were 92 percent more catering orders than the daily average for Q4. 
  • The fourth quarter is also a big time for holiday parties, gatherings, and catching up with family and friends. Overall, “large parties,” or a party with eight or more guests, had a +2 percent increase in same-store transactions in Q4 2023 compared to Q4 2022. 

Comfort Foods Heat Up Q4 – soups take the lead, while salads chilled out: 

  • Soup and stews warmed up with +25 percent more orders than the average from Q1 through Q3, closely followed by ramen and noodles (+13 percent), curry (+12 percent), dumplings (+8 percent), steak (+5 percent) and rice (+5 percent).
  • Salads saw a chill with -8 percent fewer orders, trailed by bowls, nachos, hot dogs (-7 percent), and tacos (-6 percent).
  • Desserts and enchiladas maintained a steady course, showing no significant change in orders during Q4 compared to the average for Q1 through Q3.
  • Whisky Business: Whiskey orders were up +21 percent in Q4 2023 compared to the average of Q1 through Q3, followed by wine (+13 percent), vodka (+12 percent), rum (+11 percent), gin (+10 percent), tequila (+9 percent), and beer (+5 percent). 
    • Out: Hard Seltzer: Hard seltzer — which often peaks in popularity in the summer months — was down the most out of the alcohols that Toast observed at -13 percent compared to the average of Q1 through Q3. 
    • Cheers to 2023: Overall, restaurant and bar guests drank approximately +11 percent more alcohol in Q4 2023 compared to the average for Q1 through Q3 2023.

The State of Tipping in America 

  • People choosing to tip on a card or through a digital transaction also remained fairly steady. Total tips averaged 18.9 percent in Q4 2023, the same as Q3 2023. Full-service restaurant (FSR) tips also remained flat at 19.4 percent. Quick service restaurant (QSR) tips dipped just .1 percent from Q3 2023 to 16 percent. 
  • Caught me on a good day…On average, guests tend to be the stingiest when tipping on Sundays and the most generous on Thursdays. Tips on Sundays averaged 18.73 percent in Q4 2023, whereas tips on Thursdays averaged 19.06 percent for the quarter. 
  • With exceptions of course: tips peaked on Christmas Eve — a Sunday— with an average tipping rate of 19.51 percent. 

State of Digital

Qu announced the results of its fifth annual survey of quick service (QSR) and fast casual (FC) restaurant brands. According to the Qu 2024 State of Digital Report, QSR and FC restaurant guests can expect to see more kiosks in stores this year, as well as new mobile apps, and voice AI on the phone and in the drive-thru, which all topped the list of new ordering channels planned for 2024.

Self-service preferences have emerged as key to helping brands manage labor challenges and increase sales. Report findings make it clear the future will be data-driven with API-centric platforms, new loyalty frameworks and more AI use cases emerging.

The report also revealed the persistence of digital ordering for brands post-pandemic. After the spikes in recent years, restaurants reported that digital sales make up 26-50 percent of overall sales where they are expected to remain for the next few years.

“Brands have found the sweet spot mix of digital and in-person ordering after a roller coaster few years of getting their online house in order,” said Qu CEO Amir Hudda. “Guests are more comfortable ordering on screens and from their mobile devices. Combine that with a tight labor market and we’re seeing a shift to self-serve ordering even in the store.”

The Qu 2024 State of Digital Report analyzes market trends and predictions from a survey of respondents that include the largest multi-brand, multi-unit restaurant operators. The findings in the report include the top challenges for enterprise restaurant operators, investment priorities, innovations, digital sales trends, and what brands can expect for 2024.

Key trends highlighted in the report:

  • Kiosks are making a comeback. Kiosks are the number one order channel to add with 44 percent of brands planning them in 2024. The top order channels restaurants plan to add in 2024 are:
    1. Kiosk
    2. Mobile app
    3. Expanded delivery partners
    4. Phone AI ordering
    5. Voice ordering in drive-thru

“Self-serve options give guests more choices and more control while driving higher check sizes, easing labor challenges, and lowering operating costs. We expect this trend to continue into AI ordering over the next few years. It’s an exciting time,” Hudda added.

  • Fewer swings and surprises in digital sales. The new frontier is optimization of digital channels to drive profitability and healthy revenue growth. More than three quarters of brands (77 percent) increased digital sales in 2023, and 87 percent expect it to grow again in 2024. Digital ordering is still larger at fast casuals versus QSR. Half of fast casuals achieved 26-50 percent digital sales, while nearly half of QSRs had 11-25 percent digital sales.
  • Loyalty 3.0 emerges, top tech investment for 2024. The vast majority (80 percent) of respondents say loyalty is not working for their brand. The report predicts a new data-centric loyalty framework will emerge with guest experience at the core.
  • Flexible platforms are the future. The shift to flexible API and data-driven platforms is well underway with 65 percent of respondents saying they plan—or already have—transitioned to a cloud-based, API forward unified ordering and commerce platform. These platforms are proving to deliver ROI through access to and normalization of data, unlocking capabilities for single source of truth and guest personalization.

“Overall the report revealed good news for the market,” added Hudda. “Brands have learned what is working for guests and are investing in modernizing and elevating the guest experience. As the economy and market settle into predictability we’ll start to see more innovation and a focus on technology for guest acquisition, loyalty, and ordering advancements.”

The Qu 2024 State of Digital Report is based on a survey of industry leaders at enterprise restaurant brands. More than 80 percent of the respondents were C-Suite, VP, or director-level executives at multi-brand, multi-unit operators with a minimum of 20 locations in the United States.

Strong Sales for Dry January

No and Low alcoholic drinks saw strong January sales in 2024, with each week in the month experiencing a double-digit increase in velocity compared to the weekly average, according to CGA’s BeverageTrak. The rising trend of Dry January participation among On Premise consumers saw 44 percent of active consumers (+10 percentage points for 21–34-year-olds) ‘very likely’ or ‘likely’ to participate in the activity. Of those participating, 73 percent of On Premise consumers in the US planned to abstain from alcohol at home, while 54 percent planned to abstain while still frequenting bars and restaurants in January. This was driven by consumers wanting to be generally healthier (45 percent), saving money (39 percent), taking up the challenge and demonstrating self-discipline (31 percent), and decreasing alcohol intake (24 percent). 

CGA’s BeverageTrak reveals that each week in January 2024 the US market saw a double-digit increase in velocity sales of the No/Low category compared to average sales across the whole of 2023. The week to January 13 was particularly strong (+22 percent), and by week ending February 3, velocity sales were still up at +12 percent. 

As consumers opt for low alcohol alternatives, Beer and Spirits saw a drop in performance. Velocity sales in the week to January 13 sales were down -16 percent and -17 percent respectively when compared to sales across the average week in 2023. Both categories saw recovery toward the end of the month, with the week to January 20 only slightly below average (-6 percent and -8 percent), and both mega-categories performing at or above average on the week to January 27, with Beer up +6 percent and Spirits flat. 

This recovery and dip in No and Low velocity suggest that by the end of the month consumers began to return to their usual behavior. Last year only 29 percent of consumers surveyed completed the month, 63 percent didn’t participate and like other New Year’s Resolutions that get abandoned long before January is over, 8 percent didn’t complete their challenge. 

Consumers abstaining while visiting bars and restaurants intended to opt for soft drinks (62 percent), sparkling water (30 percent), and hot drinks (26 percent). Less than 10 percent specified mocktails and alcohol-free beer, wine and spirits, but more than 10 percent of consumers who were likely to take part in Dry January say they’re motivated by a better range of non-alcoholic options available than in previous years. This represents a key window of opportunity for creative strategizing and product development, in order to entice more Dry January participants from the sofa to the bar. 

 CGA’s Global Bartender Report reveals that 15 percent of bartenders include no/low in their top trending drinks. This popularity can explain why it isn’t one side of the bar that are eager to learn about the category – over half of consumers (58 percent) want to get closer to no/low, making this the no.1 drinks category consumers would like to learn more about. 

Despite this popularity amongst consumers, no/low category knowledge is still relatively low (46 percent) among bartenders when compared with the likes of spirits (87 percent) and cocktails (93 percent). To bridge this knowledge gap, drinks suppliers can play a crucial role in supporting operators and their bartenders. By actively engaging with bartenders and enhancing their knowledge of the brand and the no/low category, suppliers can ensure that these non-alcoholic and low-alcohol brands remain top of mind, especially when making influential decisions in crafting seasonal drinks menus.  

Slice of the Union

Slice, the consumer ordering app and technology platform, released its fifth annual “Slice of the Union.'' Slice gathered analytics from its 20,000 mom and pop shop partners across all 50 states, to provide consumers with a deep (dish) dive into America's obsession with its favorite food – pizza.

“Slice of the Union.'' Slice gathered analytics from its 20,000 mom and pop shop partners across all 50 states, to provide consumers with a deep (dish) dive into America's obsession with its favorite food – pizza. ”

Below, find five more slices (almost a small pie!) of fun fact groups from within the report:

  • Cost: Nineteen states lowered the cost of a large cheese pizza this year (on average, the cost of pizza nationwide was down 4.9 percent) while shops in other states raised prices, some by a whopping 43.3. percent percent (looking at you North Dakota). In 2023, Washington was the most expensive state to buy pizza in with the average price coming in at $25.75. Hawaiians are the best tippers. On average, the tips on pizza delivery were 14.71 percent of the total order.
  • Toppings: Last year Slice predicted that pickles would become a favorite topping and as expected, requests for pickles on pizza rose 32 percent. Given the popularity of tinned fish, Slice presumes customers will have a deeper love for anchovies.
  • Cravings: Jonesing for pizza? You’re probably ordering it on a Friday when there are, on average, 5.2 million orders placed. 4.1 million orders come in on Saturdays with the fewest – 1.9 million – on Mondays.
  • Orders: A New Jersey resident ordered from the same pizza shop 348 times this year – that’s just 17 days shy of 365.
  • Weight: In 2023, Americans ate just over 29,000 tons of pizza. To put that in perspective, adult African male elephants, the world’s largest land animal, weigh between two and seven tons. 29,000 tons of pizza is also equal to the weight of 19,395,200,000 Candy Hearts.

Super Bowl/Valentine's Beverage Trends

CGA’s BeverageTrak for the week to February 17 saw positive trends (+14 percent), with Valentine’s Day occurring on February 14, with velocity reducing slightly in the most recent week (-5 percent). Latest week trends have been a result of a dip in ticket count vs the previous week (-6 percent), while average check values have increased slightly (+1 percent). Daily trends over the last two weeks have been variable by day, with velocity affected by NFL’s Big Game on February 11 and Valentine’s Day on February 14. NFL’s Big Game resulted in a dip in velocity vs the previous Sunday (total US down – 20 percent), while Valentine’s Day resulted in a triple-digit growth for the average US outlet (+129 percent), with each key state having over double the velocity of the previous Wednesday.

Florida

  • Sales velocity is now +3 percent year-over-year (comparing the same week one year prior)
  • Sales velocity is now -5 percent vs February 17, 2024

Illinois

  • Sales velocity is now 0 percent year-over-year (comparing the same week one year prior)
  • Sales velocity is now -5 percent vs February 17, 2024

California

  • Sales velocity is now +2 percent year-over-year (comparing the same week one year prior)
  • Sales velocity is now -4 percent vs February 17, 2024

New York

  • Sales velocity is now +14 percent year-over-year (comparing the same week one year prior)
  • Sales velocity is now -1 percent vs February 17,  2024

Texas

  • Sales velocity is now +3 percent year-over-year (comparing the same week one year prior)
  • Sales velocity is now -7 percent vs February 17, 2024

Matthew Crompton, Regional Director – North America, said: “The past two weeks in the US On Premise has witnessed fluctuating daily trends, heavily influenced by major events like NFL’s Big Game and Valentine’s Day. NFL’s Big Game saw a notable dip in velocity, particularly in Beer, Spirits, and Wine sales, while Valentine’s Day resulted in a significant surge in sales across all alcohol types. Drinking outlets, particularly Sports Bars, thrived on NFL’s Big Game, while Fine Dining outlets emerged as the biggest winners on Valentine’s Day, experiencing the strongest trends vs average, with velocity up +144 percent vs the average Wednesday of 2024. Understanding these trends is crucial for businesses, operators, and suppliers alike to align strategies, capitalize on consumer behaviours, and tailor offerings for optimized performance during key occasions and events.”

America's Michelin Star Restaurants: Most and Least Expensive 

  • Masa in New York is the most expensive, with their standard tasting menu costing $750 per person 
  • Sushi Noz and Single Thread are second and third, with their tasting menus costing $525 and $495 respectively 
  • The least expensive is Aquavit in New York, who charge $175 for their tasting menu

Restaurant furniture experts at Restaurant Furniture analyzed the menus of all 45 restaurants in the U.S. that have two or three Michelin Stars to determine which ones are the most and least expensive. They were ranked based on their standard menu pricing per person. 

Taking the top spot is Masa in New York, whose standard tasting menu will set you back an astonishing $750per person. Established in 2004 by Japanese chef Masa Takayama, it has earned the maximum of three Michelin Stars. It gained its third star in 2009, and was the first Japanese restaurant in the US to do so. With a casual and comfortable dress code, the $750 Omakase menu is the cheaper of two options, with their Hinoki Counter Experience costing $950 per person. This experience guarantees seating at their sushi counter for an immersive experience with one of their highly skilled sushi chefs.  

In second place is Sushi Noz, also in New York. The standard tasting menu costs $525 per person. With a vision to create an elegant dining experience with sushi, chef Nozomu Abe opened Sushi Noz in 2007. Their Edomae style menu is a 2.5-hour experience, beginning with a series of small plates, followed by a selection of seasonal nigiri, finishing with miso soup, tamago and dessert. Receiving its first in 2020, the restaurant now has two Michelin Stars. 

Third is Single Thread in Healdsburg, California. Opened in 2016 by chef Kyle Connaughton and his wife Katina, its standard tasting menu costs $495 per person. The chef’s ten-course Japanese menu has earned the restaurant three Michelin Stars, with their fruits, vegetables, herbs, flowers and honey supplied by Katina’s farm. 

Next on the list is Benu in San Francisco, with a tasting menu that costs $420 per person. Their three-hour dining experience puts a Western spin on Korean and Cantonese food, featuring a wide variety of seafood, vegetables, meat courses and dessert. After 25 years working at some of the most acclaimed restaurants in the world, chef Corey Lee opened Benu in 2010. It has since received three Michelin Stars, becoming the first restaurant in San Francisco to do so. 

Sushi Ginza Onodera in West Hollywood is fifth, with its tasting menu costing $400 per person. Opened by chef Akifumi Sakagami in 2013, the restaurant has earned two Michelin Stars. The Omakase menu includes Edomae style traditional sushi, with fish imported from the Toyosu Fish Market in Tokyo.  

The research also revealed the least expensive two and three Michelin Star restaurants.  

In first place is Aquavit in New York, with the standard tasting menu priced at $175 per person. First opened in 1987, the restaurant has two Michelin Stars. The five-course menu offers exquisite Nordic cuisine, beginning with yellowtail and pear, followed by scallop and chestnut. The experience then moves on to cod and cauliflower, before a beef and black trumpet dish, concluding with an almond and maple dessert. 

Second is Le Bernardin in New York. This is the cheapest three Michelin Star restaurant in the US, with a dinner menu priced at $210 per person. The seafood restaurant, owned by Maguy Le Coze and chef Eric Ripert, has held its three Michelin Stars since 2005. Some of its menu’s highlights include caviar tartare, seafood truffle pasta and Japanese Wagyu. 

Commis in Oakland is third, with their tasting menu costing $225 per person. Established in 2009 by chef James Syhabout, the restaurant has two Michelin Stars. The ten-course dining experience begins with cool oysters, raw fish and salads, progressing into warm seafood and finishing with rice.  

In fourth place is The Modern in New York, with their tasting menu costing $225 per person. Since opening in 2005, the restaurant has gained two Michelin Stars. Sitting directly next to the Museum of Modern Art, The Modern offers elegant French-American cuisine. Chef Thomas Allan’s eight-course tasting menu, while it is changed frequently, includes some surprise courses meant to be shared between the table. They also offer an inventive range of desserts including strawberry Romanoff. 

Fifth is Odo in New York. Their tasting menu costs $265 per person. Owned by chef Hiroki Odo, the restaurant serves traditional Japanese cuisine. Five of the eight courses are seafood-based, despite Hiroki Odo being the former head chef at an acclaimed vegan restaurant. Since opening in 2018, Odo has gained two Michelin Stars.