Leveraging LTOs in Fast Casual

Limited-time-offer menu items hold broad appeal and can resonate particularly strongly with younger consumers, new Technomic research finds.

Nearly half (48%) of the 1,000 consumers polled for Technomic’s latest Consumer Brand Metrics trend report said they had tried a limited-time-offer menu item in the past month, and more than three in 10 of those ages 18 to 44 had ordered one in the past week. In addition, half of Millennials and Gen Xers agreed that they enjoy being the first of their friends to try an LTO menu item—a proportion significantly larger than that seen among Baby Boomers (21%) and Matures (13%).

Fast-food restaurants are consumers’ top source for LTOs: 52% of consumers said their most recent LTO purchase was from a quick-service concept, vs. 18% who said they last ordered an LTO at a casual-dining restaurant and 7% who last purchased one at a fast-casual concept. But that doesn’t mean there’s not significant interest in seeing LTOs on fast-casual menus. In a poll for Technomic’s 2014 Future of LSR: Fast-Food and Fast-Casual Restaurant Consumer Trend Report, 43% of consumers said it’s important or extremely important to them that a fast-casual restaurant frequently offer new or seasonal menu items. And 26% indicated they would pay at least slightly more at a fast-casual restaurant for seasonal foods and beverages.

Seasonal Showcase

So how can fast-casual concepts make LTOs work to their best advantage? To start, by focusing LTOs on what fast casual is best known for (or strives to be best known for): fresh, in-season flavors. Two-thirds of consumers—including 73% of women—said they’d be likely to order limited-time-offer foods that feature flavors they associate with a specific time of year. Nearly three-fifths of consumers, and seven in 10 consumers ages 18 to 44, said the same about beverages featuring season-specific flavors.

On a related note, LTOs offer the opportunity for operators to showcase seasonal flavors in menu items that (though they may have loyal year-round fans) wouldn’t necessarily be top of mind for a particular season—hot soups in summer and icy beverages in fall and winter, for instance. Fast-casual examples of this include Panera Bread’s currently featured Vegetarian Summer Corn Chowder (featuring sweet corn, red potatoes, poblano peppers, fresh cilantro and sweet cream) and the Iced Pumpkin Latte and Frozen Pumpkin Pie blended beverage menued at Einstein Bros. Bagels last fall.

New & Novel

With respect to LTOs not built around seasonal flavors, it may be worthwhile to focus on novel tastes. In Technomic’s Consumer Brand Metrics poll, consumers in the Midwest and West in particular indicated significant interest in LTOs that feature unique ingredients not found elsewhere on the menu. Bruegger’s last summer used an LTO to introduce trending sriracha sauce to the menu; the Sriracha Egg Bagel saw a strong enough response from customers that Bruegger’s made it a permanent addition to the menu in the fall.

The success of Bruegger’s sriracha egg breakfast sandwich brings up another important point about LTOs: Know when to hold ’em. Sixty-two percent of consumers, including more than 70% of women ages 18 to 44, said they would be disappointed if an LTO they enjoyed was not available on their next restaurant visit.

Earlier this month, I was at a coffee shop and overheard a guest try to order a pumpkin latte. In mid-July. The barista explained apologetically that pumpkin-flavored items wouldn’t be returning until September. Operators can’t be expected to menu pumpkin (or gingerbread, or strawberry) menu items year-round, of course—and get-it-before-it’s-gone exclusivity can heighten the appeal of an item—but the summer pumpkin-seeker goes to show that a beloved item or flavor profile can spur cravings year-round. Successful LTOs that don’t feature season-specific flavors can serve as valuable menu differentiators if added to the permanent menu.

Technomic research suggests that consumers are hungry for LTOs and for unique tastes that will give them reason to return to a specific restaurant concept (and tell their friends about said unique items). Fast-casual restaurants that work toward original rather than obvious in their LTOs may be best positioned to win over today’s new-taste-craving consumers.

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Darren Tristano

Darren Tristano is President of Technomic Inc. Since 1993, he has led the development of Technomic’s Information Services division and directed multiple aspects of the firm’s operations.

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