Unchaining from the Mainstream

There’s a major shift happening in the restaurant industry, and you can thank both the Food Network and The Experience Economy for the dramatic change in the way people want to eat.

Don’t worry, nothing sinister is afoot. But two predominant factors have united in the consumer mindset that’s changing where many diners want to spend their money eating out. Rather than stick to the typical very well-known national branded restaurant companies, people want to feel like they are breaking away from the mega brands seen on every Main Street in the country.

Plus, a generation raised on decades of flavorful food programming is seeking out restaurant brands that appeal to a more sophisticated pallet. It’s giving them a knowledge and desire to eat in ways that major chains are unable to accommodate. More frequently, when a brand tries to appeal to everyone, they appeal to no one.

Here’s where the Experience Economy part fits in. People do not want fungible cookie cutter moments that could happen at any of the myriad leading chain restaurants. Customers crave a connection with companies they perceive as smaller, and they champion the ones they like most. They like to connect through a great brand story, and that’s just something larger and more impersonal brands are unable to accomplish simply by the nature of what they are.

It’s a David vs. Goliath story where even Goliath is starting to get a bit nervous. The dining world has pivoted leaving many of the largest companies confused as to what they really are and how they can recapture an understanding of what they want to be during the next decade.

Smaller chains typically have more focused menus espousing a more relevant thematic to today’s customer. Plus, there seems to be a greater understanding by arising brands how to better connect with customers through new media and relevant Internet advertising.

“We’ve been seeing that for years,” Darren Tristano, executive vice president at the restaurant consulting firm Technomic, told Nation’s Restaurant News, last year. Technomic creates restaurant industry research and reports geared to providing consumer-grounded vision and channel-relevant strategic insights. “It isn’t just the attitude toward larger brands. It’s the ability of smaller brands… to utilize trends faster. While all these bigger [brands] are struggling to keep up and catch up, the smaller chains are able to add items consumers are looking for.”

At the Restaurant Leadership Conference held this past spring, Technomic data showed 40 percent of people prefer non branded restaurants.

And smaller brands have another advantage; they simply do not feel like they’re branded restaurants. When there are relatively few outlets compared to ones that have thousands, customers do not link a company to a much larger one. Also, customers feel a kinship for a smaller brand and feel committed to helping it succeed. So they’re likelier to be an influencer and encourage friends and family to eat there as well.

This all adds up to franchise owners of newer, emergent brands finding more success than if they were to open up just another outlet from Brand X.

Macro consumer trends demand multi-unit operators and developers rethink brand affiliation. Aligning with brands unchaining themselves from mainstream tendencies is proving to be a winning strategy.