Dive Brief:

• Gen Z diners made fewer visits to restaurants last year compared to visits made by Millennial and Gen X generational cohorts when they were 18 to 24 years old, according to NPD Group data.
• Gen Z visited restaurants 66 fewer times in the 12 months through February 2022 than Gen X did in 2002, when 18- to 24-year-old Gen X consumers visited restaurants 284 times per year. While Millennials visited restaurants 40 fewer times per person per year than Gen Xers at a comparable age range.
• Pandemic pressure and higher menu prices driven by inflation have discouraged Gen Z from dining out, NPD Group finds, and price is the most important factor for this demographic when choosing a restaurant. 

Dive Insight:

Labor market factors may also influence Gen Z’s propensity to visit restaurants. Gen Z entered the labor force after 40 years of flat real wage growth, according to Pew Research. Record high inflation has outpaced wage growth since 2021, CNBC reported, effectively cutting pay for most hourly workers.

Restaurant traffic dropped nearly 10% year-over-year in April, as consumers felt the sting of record-high menu and gas prices. But Revenue Management finds that Gen Z is the generation reacting to inflation with the most intention, taking care to cut back on drive-thru and off-premise dining.

This shift is significant, as most Gen Z consumers — which represent nearly $100 billion in spending power – prefer to access restaurants through delivery channels or via carryout. To meet these consumers where they’re at, a number of major chains have dabbled in new marketing tactics.

Wendy’s teamed up with Fortnite and Chipotle partnered with Roblox in a bid to appeal to gamers within this demographic, as gaming is a top activity for many Gen Z consumers. Gen Z consumers also spend about 12.2 hours playing video games each week compared to 6.6 hours interacting with friends in-person, which may have driven Pizza Hut, McDonald’s and Jimmy John’s to experiment with the virtual world.

“Restaurant operators and their manufacturer partners must quickly adapt to how Gen Z consumers think and feel,” NPD Food Industry Advisor David Portalatin said in a statement. “An understanding of which menu items to emphasize, the food attributes they seek, menu innovations that appeal to them, and their preferred advertising platforms will help you win the favor of this valuable generation.”