Carol Krol

Starbucks topped the Beverage-Snack segment, which led the industry in market share growth

Market share shifts in this year’s Top 100 universe were registered in key areas where foodservice is seeing dynamic changes to consumer habits.

Seven of the 13 restaurant segments represented in this year’s Top 100 gained market share in the Latest Year, based on their respective U.S. systemwide sales as a percentage of the full Top 100 universe. Of those, Beverage-Snack, LSR/Mexican and Bakery-Cafe experienced the most gains. Pizza, Chicken, C-Store and LSR/Specialty — which consists of the LSR/Chinese, LSR/Fish and LSR/Noodle subsegments — also registered increased fractional market share gains. Segments that lost share included LSR/Burger, Casual Dining, LSR/Sandwich and Family Dining.

The Beverage-Snack segment led the growth story with a gain of 0.4 percentage points in the Latest Year to a 9.3-percent share of the Top 100 universe. Starbucks still dominates this segment, inching up its share among like brands to 57.4 percent in the Latest Year, compared with 57.1 percent in the Preceding Year. Krispy Kreme Doughnuts and Auntie Anne’s both gained fractional share, as well, while Dunkin’ Donuts, Baskin-Robbins and Jamba Juice all dipped slightly.

Consumer preference for snack occasions could be the juggernaut driving this segment, according to data from market research firm The NPD Group.

Data

• Market Share by Segment

“Consumers are changing eating habits, eating smaller meals and calling it a snack,” NPD analyst Bonnie Riggs told Nation’s Restaurant News in May.

That snacking shift is driven by Millennials and baby boomers.

“[They] don’t want to eat a full meal, so they are snacking throughout the day,” Riggs said. “Some of it has to do with price, some has to do with craving, [and some are] too busy for a full meal.”

The LSR/Mexican segment, which gained 0.2 percentage points for a 5.7- percent share, was propelled mainly by Chipotle Mexican Grill — a favorite among Millennials, but perhaps not for snacking.

Chipotle’s commitment to serving menu items from more transparent supply chain sources, like antibiotic-free proteins or organic or local produce when possible, creates a health halo around its food.

According to data from market research firm Technomic Inc., 53 percent of fast- casual consumers said healthful menu items were important, and 63 percent expect such dishes. Technomic told NRN that fast-casual customers also are slightly more willing than fast-food customers to pay more for healthful items.

While smaller segments are posting gains in Top 100 market share and building relevance among today’s consumers, the LSR/Burger segment maintains its dominance in the Top 100 universe, with a 32.7-percent share in the Latest Year. Still, that dominance has slipped for two consecutive years: In the Preceding Year, the LSR/Burger segment commanded 33.3 percent of market share, and in the Prior Year it held 33.8 percent of share.

LSR/Burger segment leader McDonald’s, which operates or franchises more than 35,000 restaurants in more than 100 countries, is admittedly struggling in the United States. The chain’s 2013 U.S. same-store sales fell 0.2 percent, and comparable guest counts declined 1.6 percent, according to company filings. It also saw its share of the LSR/Burger segment drop in the Latest Year.

Oak Brook, Ill.-based McDonald’s has said it would attempt to stabilize domestic results through improvements in customer service, value and menu initiatives, such as recent promotions around the Dollar Menu & More and its breakfast platform.

Perhaps soon to be nipping at McDonald’s dominance in the breakfast daypart is Taco Bell, which launched a breakfast menu in April that features products like the Waffle Taco, the A.M. Crunchwrap and breakfast burritos. Taco Bell began marketing with direct attacks toward McDonald’s.

“Taco Bell is in a good position to do this right now because I think there’s a halo from Doritos Locos Tacos, and they’re known for this fun mind-set,” Charlie Hopper, creative director for Indianapolis- based agency Young & Laramore, told NRN. “It’s fun to eat a Waffle Taco, and that’s a holdover from Doritos Locos, when they got everybody to indulge … with that product and made the brand newsworthy.”

Taco Bell saw its Latest-Year U.S. systemwide sales increase 4 percent on top of a 7.1-percent increase in the Preceding Year. The Irvine, Calif.-based chain saw its market share within the LSR/Mexican segment decline nearly 2 percentage points, mainly because of Chipotle’s surge. Within the total Top 100 universe, however, Taco Bell maintained its share of the market. 

By the numbers

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Contact Carol Krol at [email protected].