At the same time, some fast-casual leaders deny that category competition affects their thinking. “The top line on all this, however,” says Chipotle spokesman Chris Arnold, “is that Chipotle doesn’t really think of ourselves in terms of categories like ‘fast food’ or ‘fast-casual.’”
One point the restaurant operators at Technomic’s Orange County meeting were able to agree on was to allow consumers to help define what the term “fast-casual” means. That means paying close attention to the kinds of consumers who frequent fast-casual eateries, what kinds of dishes they order, and how much they are willing to spend.
Among consumers, “fast-casual” might still be a notion rather than a firm concept. Researchers who survey consumers find they must provide not only a thorough definition, but also multiple examples of concept names—as many as 20 of them—before consumers understand the sort of restaurant under study. The vast majority of respondents have never heard the term “fast-casual,” says Mintel’s Morris. “They simply view it as more upscale fast food,” he says, “or they have a brand awareness of particular restaurants.”
Yet consumer media are picking up on the term. “Colorado customers eat up fast-casual concept,” announced Colorado Springs NBC affiliate KOAA, leading into a recent story on the growing Spicy Pickle concept. “Fast-casual Mexican now the hottest flavor,” trumpeted the headline on an Albany, New York, Times Union story about the spate of independent and chain taquerias opening in the area. And Alabama’s Huntsville Times used “fast-casual,” without further explanation, to describe Frizzle’s, a new independent concept opening this spring.
In covering Captain D’s transition, a business reporter for The Tennessean, a Nashville-based newspaper asked the company’s president David Head directly: “Are you trying to move Captain D’s from a quick-serve chain to fast-casual (the industry term for chains such as Panera Bread)?” Head responded, “We have a drive-thru, so in any way, shape, or form, we’re probably going to be categorized as a [quick-service concept], but when we built our prototypes … 90 percent of the guests view us as being more than an everyday fast-food place.”
Several questions later, Head describes the new Captain D’s prototype this way: “It’s almost a casual-dining restaurant, if you will.”
Head and other Captain D’s leaders might not be aiming for the fast-casual label, but the shrinking gap between “more than an everyday fast-food place” and “almost a casual-dining restaurant” just makes the territory more vexing for anyone looking for hard numbers.
The Evolution Continues
According to the NRA’s 2008 industry outlook, the consumer trends that are buoying fast-casual success should continue to drive the segment for at least the next year. Nearly a third of operators say their customers are looking for a wider range of food choices from restaurants, while 19 percent say customers are seeking healthy alternatives. About one in ten quick-serve operators say the top trend this year is toward improved food quality.
As for the consumers themselves, three out of four adults told NRA researchers they are trying to eat healthier in restaurants now than they were two years ago. Given the ability of fast-casual companies to develop, source, and promote more healthy-sounding menu items, served freshly prepared in settings that let the customer have a say, the segment is well positioned for unit growth.
Yet when it comes to technical definitions of fast casual—who’s in, who’s out, and who gets to cross the lines—industry watchers say those decisions fall not to consumers, but to restaurant leaders. “Bottom line, these are industry terms,” says Morris. “They are ways for the industry to compartmentalize and make sense of the vast array of options out there.” As a result, he says, definitions and terminology will continue to change over time.
“Clearly, there are quite a few perspectives on the topic,” says Tristano. “Opinions vary, but ultimately, we believe the clarification is within the industry, versus at the consumer’s perception.”