KPMG’s 2015 food and beverage survey for UAE recently concluded, and the findings revealed trending consumer behaviour, patterns, preferences and opportunities in the industry for restaurateurs.
The survey respondents were drawn from a mix of Emirati and GCC nationals, Arab, Asian and Western expatriates.
Findings revealed that the eating out market continues to be one of the strongest performing sectors in the UAE with many residents now eating out more frequently and spending more than they were a year ago — 66% of the respondents eat dinner out at least once during the week with an average spend of AED 120 per person.
Casual dining restaurants, QSRs (Quick Service Restaurants) and food courts, are the most popular F&B choices for UAE residents. Fine dining is still largely associated with special occasions; unsurprisingly as income levels rise, the preference for fine dining increases. Interestingly however, the preference for cafes also increases with higher income levels.
KPMG partner Anurag Bajpai said: “There is no lack of eating out options across the UAE and the increase in supply, in some segments of the market, continues to exceed the increase in demand. While the outlook for the sector as a whole has probably never been better, for individual players, the market has become increasingly competitive and thus challenging.”
Respondents noted that the type and quality of cuisine along with level of service were the most important factors when selecting a restaurant. Also, respondents indicated that cost was a far less important factor, suggesting consumers are prepared to pay more for the right experience.
“Given increasing competition, it has become important for operators to deliver the right experience and continue to innovate,” added Bajpai. “While the market is favourable, success is not guaranteed and there are still many examples of failure.”
Over 70% of respondents indicated they were influenced by opinions of friends and family and over 40% read an online review before visiting a restaurant for the first time; traditional advertising was found to be the least effective medium.
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“Increasing internet usage and smart phone penetration is both a risk and an opportunity. Brands now really need to pay attention to their online presence and have a clear strategy. The operators who are getting this right are really benefiting, as they are not only raising their profile but are also enabling their customers to be advocates for their brand,” he said.
Takeaway remains a relatively small segment of the market given the propensity of UAE residents to go out to eat but a number of the well-known restaurants have been witnessing regular usage and following.
“This really presents an opportunity for many of the smaller players in the market as they may not get to appear alongside global names in the consumer conscience for the first time,” he concluded.
In addition, the research suggested that 60% are willing to travel for more than 20 minutes for the right food experience. Moreover, approximately 1600 new restaurants are expected to open by the end of 2016, yet there is a demand for East Asian cuisine and authentic home flavours in the market.
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