Today's consumers demand better-for-you menu choices, but how much more are they willing to pay for them? FoodService Director's research sister, Technomic, surveyed consumers to see how much of a premium they'd accept for organic, natural, hormone-free and locally sourced ingredients.
Of the better-for-you menu callouts, “natural” drives consumers to limited-service options the most. The tag is a particularly effective traffic driver for women (73% of women would go to a restaurant that served natural food vs. 67% of men). In fact, women are more likely than men to eat someplace because of all four callouts pictured above, compared to men. And, not surprisingly, millennials and Gen Z (aka anyone under the age of 35) are more likely than their older counterparts to make decisions based on healthful menu options.
For all the descriptors, diners in the Northeast are the most willing to pay more, while Midwesterners are the least open to upped menu prices. And income also plays a role in what consumers are willing to spend: The lower a consumer’s income, the less likely they are to want to pay for higher-quality ingredients.
Overall, 60% of consumers willing to pay more for natural ingredients are open to paying up to $2 more per check for the better-for-you options. The number of diners open to paying $2.50 to $4.50 more for natural ingredients dips sharply; however, one in 10 say they’d be okay with an increase over that price, showing there are people who will pay for better quality.
Men are more accepting of a premium price for better-for-you options, even though women are more likely to frequent a place that uses ingredients percevied as being more healthful.
Not surprisingly, the generation that’s all about higher-quality food—the millennials—are willing to pay the most for food tagged as being more healthful. Despite the large income difference, baby boomers and Gen Xers average similar responses in what they are willing to pay for natural ingredients. The average that older consumers are willing to pay, both baby boomers and matures, is notably smaller than the other demographics.
We also looked at the three eater types, as defined by Technomic, that use restaurants the most—Busy Balancers, Foodservice Hobbyists and Functional Eaters. Typical of the Busy Balancer, who is all about eating healthy as well as convenience, higher prices won't hold them back from purchasing better-for-you options. And since this group purchases food away from home more than any other archetype, their willingness to open their wallets is significant. On the opposite spectrum, Foodservice Hobbyists on average will pay far less for natural ingredients than the other two groups, partly because this middle-income group is prone to looking for deals and value.
It’s not the highest earners who are willing to pay the most for natural ingredients. While those who make $150,000-plus are open to paying more than those who make $74,000 or less, it’s consumers in the $75,000 to $99,999 bracket that average the highest max they’d be open to adding to checks for better-for-you callouts.