Despite high inflation and rising menu prices, full-service restaurants (FSRs) have been staging a comeback. Consumer transaction data reveals that for major FSR competitors—Bloomin’ Brands (NASDAQ: BLMN), The Cheesecake Factory Inc (NASDAQ: CAKE), Cracker Barrel Old Country Store Inc (NASDAQ: CBRL), Darden Restaurants (NYSE: DRI), Denny’s Corp (NASDAQ: DENN), and Dine Brands Global (NYSE: DIN)—sales in the third quarter of 2022 were higher than they were in the same quarter of 2019. In terms of other full-service restaurant trends, our analysis found that Bloomin’ Brands had the highest average sales per customer for both online and dine-in orders, while Cracker Barrel had the highest quarter-over-quarter customer retention among these companies in the restaurant industry, with Darden Restaurants and Dine Brands Global closely following.
Sales at full-service restaurants exceeded pre-pandemic levels, with The Cheesecake Factory Inc (NASDAQ: CAKE) leading the pack in Q3 2022
Consumer transaction data shows that all the full-service restaurant companies in our analysis experienced sales growth between the third quarter of 2019 and the third quarter of 2022. Notably, our data excludes transactions via gift cards, corporate spending, and Uber Eats.
The Cheesecake Factory Inc (which includes The Henry, Grand Lux Cafe, Zinburger, The Cheesecake Factory, Wildflower, North Italia, Flower Child, The Greene House, and Culinary Dropout) took the cake for the most sales growth among these companies during this time, with sales increasing 33 percent. Notably, The Cheesecake Factory acquired Fox Restaurants Concepts in late 2019, which could be a factor in its elevated sales in Q3 2022.
Sales in this period also increased 27 percent at Cracker Barrel Old Country Store Inc (which includes Maple Street Biscuit Company and Cracker Barrel), 22 percent at Darden Restaurants (which includes Olive Garden, Eddie V’s, LongHorn Steakhouse, Seasons 52, The Capital Grille, Bahama Breeze Island Grille, Yard House, and Cheddar’s), and 13 percent at Bloomin’ Brands (which owns Carrabba’s, Bonefish Grill, Outback Steakhouse, and Fleming’s Steakhouse).
In the third quarter of 2022, sales at Dine Brands Global, which includes IHOP and Applebee’s, were 9 percent higher than the same quarter in 2019. At Denny’s Corp, sales grew 6 percent during this time period. On a year-over-year basis, Cracker Barrel and Darden Restaurants had the highest sales growth among these FSR competitors, with increases of 10 percent and 5 percent year-over-year, respectively. The Cheesecake Factory Inc was the only restaurant company in the analysis that experienced a decrease in sales year-over-year in Q3 2022, with a slight decline of 2 percent.
Average quarterly sales per customer in Q3 2022 was higher for the online channel at most FSRs
One of the major full-service restaurant trends early in the pandemic was the pivot to meal delivery services and other off-premise operations, including ghost kitchens and curbside pickup, as in-person dining locations were temporarily closed. As full-service restaurants continue to balance both dine-in and online orders, our data shows that the average quarterly sales per customer in Q3 2022 was higher for the online channel compared to in-person orders for most of the companies in our analysis.
Bloomin’ Brands had the highest average quarterly sales per customer for both channels in Q3 2022, with $118 for online sales and $108 for dine-in sales. Denny’s had the lowest, with $74 for online orders and $57 for dine-in. Cracker Barrel had the biggest gap in average quarterly sales per customer between the online and retail channels, with values of $92 and $64, respectively. Delivery fees and higher pricing for items listed on delivery service platforms could potentially account for higher spending on online orders.
Darden Restaurants, notably, has not partnered with third-party companies or offered delivery services, though it offers to-go ordering. It is also the only company in our analysis for which quarterly sales per customer is higher for the retail channel than for the online channel–$96 versus $82. Another potential factor in the sales per customer difference by channel is that it has fine dining chains such as The Capital Grille and Eddie V’s in its portfolio.
Throughout the pandemic, some FSRs have launched virtual brands. For example, Applebee’s (owned by Dine Brands Global) launched the virtual restaurant Cosmic Wings in February 2021. Some FSR companies, including Darden Restaurants, the Cheesecake Factory Inc., and Dine Brands Global, have also paused online orders during staffing shortages to prioritize dine-in orders during busy periods.
What percentage of FSR customers from Q2 2022 returned in Q3?
Looking at customer retention in the restaurant industry, most of these companies had similar retention rates, with the exception of The Cheesecake Factory Inc. Customers at Cracker Barrel Old Country Store Inc. were most likely to return between Q2 and Q3 of 2022, with 36 percent of customers returning. Darden Restaurants followed, with a quarter-over-quarter customer retention rate of 34 percent.
At Dine Brands Global, 32 percent of customers from Q2 made a repeat purchase in Q3 2022. In addition, 31 percent of customers from Denny’s Corp and 29 percent of customers from Bloomin’ Brands were retained in this time period. Customers at The Cheesecake Factory and its subsidiaries were least likely to be retained quarter-over-quarter, with 22 percent of customers returning.
Bloomberg Second Measure launched a new and exclusive transaction dataset in July 2022. Our data continues to be broadly representative of U.S. consumers. As a result of this panel change, however, we recommend using only the latest post in assessing metrics, and do not support referring to historical blog posts to infer period-over-period comparisons.