Catering to the New Affluent Consumer

In the last blog, Spending Patterns of Affluent Consumers, we discussed how spending patterns of affluent consumers have changed as well as why they have remained lower than they were before the recession. Mostly, the reasons pointed to the tendency for affluent consumers to enjoy the thriftiness that they developed as a necessity during the recession. Although most seem more optimistic about the general economic condition of the country, their spending habits remain conservative.

Some of the observations surrounding these tendencies could be viewed negatively for the restaurant industry, but with some careful planning and understanding of the ramifications of affluent frugality, many restaurants can retain their popularity with affluent customers and their families.

Popular Promotions

One surprising fact that we discovered in the preceding blog was that 64% of affluent households regularly use coupons. This supports the idea that these consumers are looking for the best possible deals that they can find. Thankfully, restaurants that are already catering to consumers at lower income levels by offering budget-friendly bargains will find that more affluent consumers are drawn to the same types of deals.

Promotions thought to only attract those on the tightest budgets will likely draw in business from unexpected sources at the highest income levels. During the recession, the affluent who learned to look for deals found that they enjoyed the feeling of being more frugal and, therefore, have continued their bargain hunting habits even in the midst of post-recession optimism.

Dwindling Desire for Sophistication

In the first installment of this blog, we also discovered that affluent consumers are reevaluating their priorities, especially when it comes to spending. They are seeing less value in doing things to impress others and are really focusing more on the things that are more important to them like family and friends.

For many, this means that instead of eating in more sophisticated restaurants, many are opting for more comfortable establishments. This affords the opportunity to enjoy a pleasant dinner with family or friends without all the pressure that comes with frequenting fine dining establishments.

True Value

Because affluent consumers are looking for better value, restaurants should be looking for ways to give their customers the best bang for their buck. The easiest way to accomplish this is probably to simply reduce prices, but that is not the wisest choice. For one thing, a drop in price indicates a drop in quality for most consumers. Generally, people believe that you get what you pay for, so they do not trust when prices are reduced. Because of this perceived diminishment of quality, the brand image will likely suffer.

A moderately priced, respected brand that suddenly drops their prices will possibly be viewed as substandard. Consumers may actually assume that an overhaul of the brand has occurred in which previously satisfactory products were exchanged for substandard substitutes. Also, lowering prices will make it incredibly difficult to raise prices later. The best way to appeal to smart affluent consumers is to serve higher quality products for a comparable price and, therefore, simply increase the value of the purchase.

Tags: affluent consumers, economic changes, Restaurant Management Group, Restaurant Receiverships, Restaurant Turnaround Management, spending habits