‘Limited-time offers’ dominating food industry: Study
- LTOs are used as a marketing strategy to keep customers coming back
- Expert: LTOs have jumped 46% in restaurants over past year
- Gen Z prefers new LTOs while Boomers like nostalgic, fan-favorite products
Ben Van Leeuwen scoops Kraft Mac & Cheese flavored ice cream Wednesday, May 15, 2024, in the Brooklyn borough of New York. Kraft Heinz approached New York-based artisanal ice cream maker Van Leeuwen a few years ago about macaroni and cheese-flavored ice cream. (AP Photo/Frank Franklin II)
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(NewsNation) — American restaurants and food brands are in their “limited-time offers” era as companies lean on the marketing strategy to keep customers coming back amid high inflation and fast-changing food trends.
New data from Technomic found that the number of LTOs in the food service industry has grown 53% over the last four years, Axios reported.
“52% of consumers say that the availability of an appealing limited-time offer is important when they’re deciding which restaurant to visit,” Lizzy Freier, director of menu research & insights at Technomic, told Axios.
Over the past year alone, LTOs have jumped 46% at both quick-serve and full-service restaurants, Frier said.
What are ‘limited-time offers’?
Well, it’s exactly what it sounds like; food items or beverages that are only available for a limited time at restaurants or on shelves. Some examples include McDonald’s “Grandma McFlurry” or Cup Noodles’ new “Everything Bagel with Cream Cheese” flavored noodles.
Many restaurants are facing a struggle to survive, constantly fighting to keep menu prices down but making little to no profit. Other restaurants, particularly chain restaurants, are thriving by using this marketing technique to keep customers coming back, despite the rising cost of food.
Due to overall food inflation, customer flow is unpredictable and trending down as Americans cut back across the board. Federal data shows the cost of dining out is up by over 4% in the past year and by a whopping 26% since before the pandemic.
Since 2014, fast-food restaurants have raised menu prices by 60%, nearly double the rate of inflation over the same period, according to a recent FinanceBuzz analysis of twelve different chains.
According to the study, prices at McDonald’s have gone up the most, surging 100% over the past ten years. These days, a Quarter Pounder with Cheese meal will set you back $11.99 on average, up from $5.39 in 2014, per the report.
Yet, new products and LTOs keep customers coming back.
Data from the Technomic study also found that younger generations are more prone to trying new LTOs while older generations are more drawn to the return of nostalgic, fan-favorite products, like Ruby Tuesday’s Rib Eye and Ribs that 76% of pollers wanted to try, Axios reported.
