Is Business Dining Your Restaurant s Silver Lining?

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1 Is Business Dining Your Restaurant s Silver Lining? Dining that happens on business trips represents approximately $77B annually in the U.S. Are you doing the right things to be sure they are choosing your restaurant on their next trip?

2 At $77B annually, business dining is big business. Yet little has been done to understand business diners and how they spend company money while they re on the road. All that is about to change. With flexible expense guidelines, clients to entertain, and an appetite for local flavor, business travelers are a lucrative target audience particularly on weeknights, when restaurants have seats to fill. And not just for fine dining restaurants either: business dining applies to all segments. This first-of-its kind study looked at business travelers dining habits and preferences, uncovering valuable insights for all restaurants looking to attract them. METHODOLOGY & DEMOGRAPHICS In March 2018, we conducted an online survey of more than 509 business travelers. To qualify, respondents had to: Be employed (either fulltime or part-time) Carry a corporate credit card (or have been offered a card and declined) who took the survey? Have traveled for business in the past year Most of the participants (67%) were middle- or upper-management. Another 13% identified themselves as support staff, while 18% were C-level executives. Respondents were split fairly evenly along generational lines. Roughly a third (29%) were Baby Boomers (aged 54+), another 37% were Gen Xers (aged 38-53), and 34% were Millennials (aged 22-37). 55%of respondents were male, while 44% were female and 1% declined to answer. 37% Gen Xers 34% 29 % Millennials Baby Boomers 2

3 Introduction Why study trends in business dining? The restaurant industry is experiencing a state of upheaval. Many are scrambling to adjust as delivery services and other technology-based disruptors erode traditional at-table traffic and sales, and restaurateurs are being forced to shift their focus away from diner experience and satisfaction. While everyone else is out there looking for silver bullets, we have a silver lining. BUSINESS DINING IS THE THIRD LARGEST T&E SPEND CATEGORY - ROUGHLY $77B Consider this: the corporate travel industry represents approximately $77 billion in annual U.S. spend, and this total is predicted to climb another 7% in With this hefty investment, major enterprises are increasingly measuring traveler satisfaction as a key success indicator. What s the opportunity for you? All of those business travelers have to eat, and tasty dining experiences make travelers very, very happy. 6% ENTERTAINMENT 10% SHOPPING 18% FOOD & BEVERAGE $ 424B BUSINESS TRAVEL SPENDING 35% AIR+CAR+GROUND TRANSPORTATION 31% LODGING In spring 2018, Dinova teamed up with GBTA, the Global Business Travel Association, to conduct first-of-its kind research into business travelers dining behaviors and preferences and their company dining guidelines. We ve mined the research for specific takeaways that restaurateurs can use to better target this growing opportunity. American Express Global Business Travel & GBTA Foundation The U.S. Business Travel Industry Business Travel s Impact on Jobs and the U.S. Economy, July 2017 Read on to learn more about Distinctions across different generations, including the types of restaurants they re choosing Which tools and technologies influence their business dining research and decisions Diner sentiment around loyalty programs Business travelers preferences regarding healthy dining 3

4 Companies loosen purse strings Expense policies are increasingly flexible. Restaurants stand to benefit. As companies compete for workers in a tightening labor market, many are homing in on traveler satisfaction; after all, a company s road warriors are often the ones closing the deals. From 2014 to 2018, the percentage of companies measuring traveler satisfaction as part of their travel program went from 12% to 41%. Industry experts anticipate this trend will increase exponentially. Two telling statistics from the GBTA s Facts or Friction 2017 Study How to Mitigate the True Traveler Pain Points Along the Travel Journey : 59% of U.S. employees rate a company s travel program policy as either Important or Extremely Important in making decisions about a new job. 92% of workers in sales roles feel their business travel experience affects the outcome of a business transaction. With travel experience so closely tied to employee satisfaction, many are recognizing the importance of dining as a key part of travel. As a result, companies travel and entertainment policies are increasingly flexible and generous. According to our study, about a quarter (22%) of travelers had no company-imposed dining restrictions at all. Business travelers were more likely to have a loose set of guidelines to follow (41%), than a mandated policy (34%). 22 % of business travelers said their company had no formal dining restrictions at all 41 % of companies have a loose set of spending guidelines As more companies are placing a premium on traveler satisfaction, these flexible policies, particularly around high-margin items like alcohol, appetizers and desserts should have restaurateurs seeing bigger dollar signs. 4

5 Who are today s business diners? Understanding business customers as corporate cultures shift The first step in attracting more business diners is understanding them. What types of restaurants do they prefer? What drives their dining decisions while on the road? While entertaining clients? It turns out, the factors differ widely among generational groups. While Millennials are quickly beginning to outnumber Boomers at work, understanding how each group dines will provide perspective into attracting the diners who are most valuable to your establishment. Overall 34 % 52 % 64 % 29 % Quick Serve Fast Casual Upscale Casual Fine Dining Millennials Most likely to dine on-the-go Gen X Most likely to be part of a pack Baby Boomers 55+ Most likely to wine and dine Quick Serve 51 % 31 % 20 % Fast Casual 63 % 51 % 41 % Upscale Casual 47 % 69 % 79 % Fine Dining 27 % 35 % 25 % 63% of travelers said they researched places to eat before their trip Daypart Considerations Overwhelmingly, 63% of Boomers opt for breakfast in their hotel while traveling - with only 8% sharing that meal with clients. On the other hand, 18% of Millennials and 18% of Gen X say they choose to start their days on the road with client power breakfasts. However, the client power lunch is dominated by Boomers (38%), compared to 24% of Millennials and 29% of Gen X. Left to their own devices, 42% of Millennials choose solo lunches, while 31% of Gen Xers dine with co-workers. The working lunch - ordering in food at an offi ce - happens regularly for 21% of Boomers, 12% of Millennials, and 12% of Gen Xers. Wining and dining of clients at dinner happens across all generations - with Boomers leading the way at 52%, followed by Millennials and Gen X at 36% each. Millennials are six times more likely than their Boomer counterparts to order delivery or take-out for dinner. Overall, 43% of Millennials are choosing alone-time meals by day s end, compared to 38% of Gen Xers and 22% of Boomers. 5

6 Millennials Favor portable effi ciency Millennials are projected to make up 75% of the workforce by 2025, and their dining habits differ fairly dramatically from their other counterparts. While the Millennial consumer stereotype paints them as foodies who spend exorbitant amounts on brunch, they re actually more likely to opt for quicker, cheaper food on business. When traveling, 51% said they typically eat at quick serve restaurants and another 63% choose fast casual. For breakfast, lunch and dinner, Millennials were the most likely to grab and go, or seek out WiFiaccessible restaurants or coffee shops. Our take: for this generation, it s all about making the most of their business day. Most (53%) said that they researched restaurants convenient to their work site, prior to a trip. 43% have used their mobile devices to order food deliveries while traveling as compared with only 22% of Boomers. That s not to say Millennials don t look for specific factors when choosing a restaurant; they certainly have adventurous palates and are more diet-conscious than the other groups. Millennials, who prefer faster and more convenient meals as a way to optimize their workday, may be the business diners you don t see. By day s end, they may be picking up their to-go orders or having food delivered to their hotel. Gen X View business dining as a social occasion Gen Xers are the age group most likely to be part of a pack when dining for business. Based on their responses, they are seizing meals as connection-building opportunities throughout the day, dining with their peers, prospects and clients. They choose to dine with co-workers more often than their cohorts 31% opting to dine with co-workers for lunch and 30% making the same choice for dinner. When selecting restaurants, Gen X research behaviors reflect a balanced interest in both quality and convenience: 63% reported looking up restaurant reviews, and 60% said they also searched for restaurants that were nearby. This group uses social media to research restaurants (37%) slightly more than their Millennial counterparts (36%). Given a choice, they select upscale casual (69%) and fine dining (35%) as they round out their day. When they do choose to go back to their rooms at night, they are the least likely to grab something and take it back with them (only 8%). They order room service more than any other group (at 12%) and follow closely behind Millennial behavior in using their mobile devices to order delivery (Millennials 18%, Gen X 13%, and Boomers 3%). Did someone say happy hour? Given Gen Xers penchant for social dining, as business travelers, they could be key to filling empty seats midweek. Make sure your online presence reflects your capacity for accommodating large parties. 6

7 Baby Boomers Crave traditional, upscale dining experiences The longer the career, the larger the restaurant tab: Boomers are the generation most likely to wine and dine on the road, reporting a high frequency of dining with prospects and clients at lunch and dinner. They showed the least reservations about expensing alcohol, snacks, airplane meals and high delivery fees. Boomers are more likely than their Millennial and Gen X counterparts to opt for traditional, seated service at each meal and tend toward upscale casual as their primary restaurant type (at 79%). They seek recommendations on where to eat from clients (59%), friends and colleagues (54%), and hotel concierges (44%). All of these are significantly higher than for their younger coworkers. When it comes to selecting restaurants, Boomers look for establishments that are vetted. While restaurant location was the most important decision factor overall across all generations (at 27%), Boomers as an individual segment are the group most likely to research top reviewed restaurants (46%). Don t underestimate the impact of local word-of-mouth on driving new, out-of-town Boomers to your establishment. Look for ways to reach your local hotels at scale. You may now have an idea of your business diner sweet spot but how do you bring more of these customers through your doors? What comes next just might help you cook up a better strategy. Let s look closely at mobile technology habits, menu preferences, and marketing tactics. 7

8 Business diners embrace mobile technology Travelers lean heavily on online research, dining-related mobile apps, social media One thing that s crystal clear from the study: business travelers of all ages have embraced dining apps as essential travel technology. A full 63% of travelers surveyed reported having dining-related apps on their mobile phones. They use apps for everything from booking reservations to reading reviews and ordering takeout all as ways of reducing friction while on the road. So which apps are their go-tos? Among dining mobile apps, Yelp led the pack (at 53%). TripAdvisor, Grub Hub, OpenTable, and Uber Eats were also in the overall top six. Unsurprisingly, the top apps were different for each generation. Millennials are more prone to use food delivery apps; 45% have Uber Eats on their phones, making it the most popular food-related app among this group. A full 63% of travelers surveyed reported having dining-related apps on their mobile phones. By contrast, only 16% of Baby Boomers have jumped on the Uber Eats bandwagon, preferring instead to use mobile apps for research. 74% of Boomers reported having Yelp on their phones. Gen X also tends to have an affinity for peer-to-peer apps; 56% said they use Yelp, and another 54% use TripAdvisor. They re also just behind Millennials in their adoption of food delivery apps; 33% of Gen Xers said they used UberEats (about twice as many as Boomers). What apps do business diners use? 53% Yelp 50% TripAdvisor 36% Grubhub 34% OpenTable 34% Uber Eats Millennials Gen X Baby Boomers 45 % 56 % 74 % Most business travelers use food-related mobile apps. Is your digital presence optimized to be found in business travelers pre-trip research, across a variety of search terms and platforms? 8

9 Mobile as an experience Do business travelers like to wing it when choosing where to eat? The answer among our survey participants was a resounding no. In fact, 63% of travelers said they researched places to eat before their trip. In addition to research, they re performing a variety of tasks that empower them to optimize their mealtimes. We asked travelers: In the past year, which of the following have you done on your mobile device while traveling for business? 60 % 45 % 30 % 15 % 0 % 35 % Ordered Delivery Overall 47 % 54 % 30 % 51 % 33 % Searched for Local Places to Eat Sent Researched Menus Searched Made a Reservation Coworkers Restaurant Info Social Media for Info/ Photos Millennials Gen X Baby Boomers 55+ Ordered delivery 43 % 38 % 22 % Made a reservation 41 % 46 % 54 % Searched for local places to eat 39 % 58 % 66 % Sent co-workers restaurant information 36 % 30 % 25 % Researched menus 43 % 52 % Searched social media for info/photos 63 % 37 % 58% 26 % Word-of-mouth credibility whether face-to-face or on social media is important to business diners. While your service should consistently go above and beyond to inspire recommendations, you ll get bonus points if you can encourage those reviews to be framed within business dining. 9

10 What s on business diners plates? Cuisine, nutrition, and other considerations What do you research? What do business diners most commonly research prior to travel? According to our study, most business diners research their food options when preparing for trips. Their decision factors run deeper than what s good around here? They re looking for experiences that suit their lifestyle whether they re looking to take in the local scene, stick to their diet, or support businesses that align with their values. 77% of business travelers stated that they prefer to eat like a local while traveling. 52% said they search for restaurants that are popular with locals, and 49% research foods that are unique to their travel destination. Despite their affinity for local flavor, business diners like to play it somewhat safe. During their pre-trip research, 36% said they look for tried and true restaurant options, while 59% find comfort in having trusted brands as available options when they re on the road. 36 % Locations of tried and true brands 49 % Local foods unique to destinations 52 % Popular with local 58 % Close to hotel or work Highlighting what s unique about your restaurant, whether it be regional menu options, your famous local dish, or the fact that you ve won favorite pub three years running, will help you appeal to business diners seeking bespoke experiences. 10

11 Most travelers aren t ditching their diets Business diners look for healthy food options, even while on the road. Most survey takers (76%) said healthy eating is either very important or somewhat important when traveling for business. Of these, many have specific dietary restrictions. While the number was 25% overall, a notable 40% of Millennials reported having special dietary needs. The Road to Wellness What do you look for when considering healthy options on business trips? 64% 23% 43% 18% Healthier menu listings Vegetarian or vegan Published nutrition facts Gluten-free options To appeal to business travelers, restaurant menus should call out healthy choices and accommodate dietary restrictions. To enable pre-trip research, have your full menu posted online in a mobile-friendly format. 11

12 Targeting Business Diners Your competitors loss could be your gain In a separate but relevant survey that we conducted in 2017, a pool of 400 restaurant owners revealed that business customers are largely viewed as lucrative. Three out of four estimated that business diners spend the same as or more than typical customers. Another 66% said they believe repeat corporate customers were extremely valuable to their business. Surprisingly few restaurateurs just 1 in 4 actively market to business diners. What if there were a better way to reach business diners directly, and incentivize them to give your restaurant a try? Imagine the competitive edge you could gain by effectively tapping into the multi-billion dollar business dining market, and gaining valuable repeat customers. Dinova s Loyalty Program: An Easy Win Business travelers in our spring 2018 survey said they were very open to the idea of preferred dining programs, particularly if they could earn points for themselves or for charity. With Dinova, they can. preferred dining programs I would dine in company-suggested restaurants if: Millennials Gen X Baby Boomers My company earned a rebate: 39 % 38 % 11 % I earned points for myself: 38 % 44 % 43 % I could gift my points to my company-sponsored charity: 75 % 61 % 42 % 12

13 Traditional restaurant marketing won t attract business travelers diners at scale Dinova is a uniquely business dining-focused marketplace that connects restaurants with valuable expense account diners nationwide. We have behindthe-firewall access in three distinct channels Fortune 1000 enterprises, the U.S. Government, and a consortium of small- and medium-sized businesses and bring insight into which target group will most benefit your restaurant. Here s how it works. We incentivize organizations and employees in our program to choose in-network restaurants by offering rebates and rewards points on their business dining activity. Our team of seasoned procurement and travel management experts works to integrate our marketplace into T&E policies and the various travel tools used by employees nationwide. The Dinova Restaurant Locator mobile app helps business diners search for and identify in-network restaurants wherever they are. Our ubiquitous mydinova loyalty program is promoted as an employee perk. How Dinova benefits your restaurant: You get preferred-status exposure to millions of business diners More profitable, midweek diners with higher average check Operationally invisible program requires no staff training or POS integration Pay-for-performance model delivers no-risk ROI Our status as a business dining authority is founded on the intersection of corporate travel and expense policy and restaurant industry insights. Dinova is the smartest way to expand your restaurant s reach and deliver more dollars to your bottom line. Ready to take the next step? Learn more about how the program works and hear from other restaurateurs who are already seeing success with Dinova. Visit 13

14 About Dinova Since 2009, Dinova has provided an innovative marketplace that gives restaurants across the U.S. access to an often untapped dining segment. Our restaurant and enterprise partners understand the value of a business patron dining on official company business and know that the connections made over a meal drive understanding and shared perspectives that establish lifelong relationships. Dinova nourishes those connections to create value for restaurants, companies, and the business people we serve every day. For more study insights, please contact us at insights@dinova.com About GBTA The Global Business Travel Association (GBTA) is the world s premier business travel and meetings trade organization headquartered in the Washington, D.C. area with operations on six continents. GBTA s 9,000-plus members manage more than $345 billion of global business travel and meetings expenditures annually. GBTA delivers world-class education, events, research, advocacy and media to a growing global network of more than 28,000 travel professionals and 125,000 active contacts. To learn how business travel drives lasting business growth, visit DINOVA8 /company/dinova info@dinova.com 14