Takeaways remain on the menu despite cost-of-living crisis

Despite the continued cost of living crisis forcing a third (38%) of consumers to cut down on takeaways as household budgets get squeezed, the public’s appetite for a fast food treat is holding firm, according to research by KPMG.

Its Food for thought report reveals that with nearly a third (31%) of consumers have at least one takeaway a week. This rises to 58% in London, while nearly four in 10 (38%) of 18–24-year-olds nationally have a takeaway at least two to three times a week. Meanwhile, 60% of those surveyed over the age of 55 said they never order a takeout.

The research found that more than half of consumers (51%) claim they will maintain the same level of takeaway spend in the year ahead, with a further 8% claiming they are more likely to increase their takeaway spend during 2023.

The analysis uncovers the ordering habits of 4,000 UK consumers and assesses the regional variations, which are largely driven by age and access to services.

It found that takeaways operating in city centres and areas with large numbers of young professionals and students are less likely to be impacted by household budget cuts due to the cost-of-living crisis with 5% of London-based consumers ordering takeaways more than four times a week, closely followed by Scotland and Yorkshire and the Humber with 3% each.

The typical household monthly spend on takeaways is £61.35, with 47% spending less than £50 per month and 10% spending over £100 per month. Takeaway lovers in the Northeast are the most cost-conscious, with 35% spending less than £30 on takeaways per month.

Family treats are still firmly on the menu in 2023, with 35–54-year-olds typically spending the most when they order, approx. £60+. Around three-quarters (72%) of the 4,000 consumers surveyed viewed takeaways as a special treat – with “not wanting to cook” being the most popular reason for ordering in.

Fish and chips ranked as the nation’s third most popular choice behind Chinese and pizza across most regions except in London, East Midlands, and Northeast where fried chicken and burger restaurants nudged it into fourth place.

The figures revealed 55% of women voted pizza as their preferred choice of takeaway or takeout food, while Chinese gained the highest percentage of votes among men with 50%, closely followed by pizza with 49% of survey responses. New entrants to the top ten list of most popular takeaways included Mexican food and Japanese/Sushi, as Greek food fell out of the top 10 list.

Commenting on the results, Will Hawkley, global head of leisure and hospitality at KPMG UK observed: “Although more broadly consumers are looking to cut back on non-essential spend in 2023 and takeaways fall into this category – our research shows that the public’s appetite for a fast, convenient food still remains as people are unwilling to let go of the very few treats, they have to look forward to.

“While the takeaway market may feel something of a squeeze due to cost-of-living pressures, a large number of consumers expect to order the same amount of takeaway over the coming year. It will remain a robust market with plenty of enduring appetite to snag a tasty deal. Leaner times in the takeaway market will require fresh approaches to keep on tempting consumers. Winning value propositions will combine quality and value with convenience and choice. Value, well-targeted promotional offers, and quality of product will be more important than ever to persuade UK consumers to part with their money this year.”

The research also reveals how consumers prefer to order their takeaway treats as the pandemic boosted the popularity of delivery apps.

The research found that the use of apps equals phone for order method (50% of consumers have used each one in the past 12 months) and exceeds over-the-counter (43%). Time-pressured 25–34-year-olds have embraced apps, with 65% of that group using them compared to only 41% using the phone. Regionally, the Northwest (54%) pips London and Scotland (53%) for digital ordering, with the lowest penetration seen in Wales (39%). Ordering through an outlet’s own website or app has also become widely adopted (35-40%).

Like food delivery, rapid grocery delivery or quick commerce has proven its popularity beyond lockdowns, with 24% of consumers surveyed having used rapid delivery services for groceries – and this rises to 41% in London.

Once again, there are some significant regional variations with areas such as the Southwest and East of England dropping to only 13% where there is a lack of availability in these areas – and also age-related differences, with these services most popular with young consumers (47% of 18–24-year-olds have used) and then tailing away progressively through the age ranges (only 17% of over 64s have tried it).

The research found that there is much opportunity for quick commerce to expand further into aspects related to food consumption, especially with 40% of consumers planning to cook more from scratch at home in order to control costs – thereby fuelling their need for ingredients.

There was continued interest in rapid delivery of a wide range of other items beyond groceries – such as butchery/local meat (37%), medicines (36%), farm vegetables (35%) and baked goods (32%). In London, there’s even demand for fashion and clothing (37%). In more rural areas – Wales, Scotland, Southwest – locally sourced goods are particularly popular.

Will Hawkley added: “A decade or so ago, the vast majority of takeaway business was done over the counter as consumers physically came in and took their orders away, but the pandemic has accelerated the use of delivery services which have now been well and truly embraced as a normal way of doing things. Consumers love its ease and convenience which is why delivery apps have become so popular.

“There is a huge opportunity for the growth of quick commerce in the UK, despite the challenging economic environment, the challenge for operators will be to find the right business and partnership models for it to become financially sustainable and scale over the long term. We could see this market grow to be worth over £1.5 billion by 2030 with successful partnership strategies and effective marketing to raise consumer awareness and willingness to try, replicating the recent growth seen in the e-commerce channel.

“Overall, our research finds that although there are undoubtedly challenges as the cost-of-living crisis continues, it’s not all bad news for the sector, with new possibilities opening up and plenty still to play for.”

The full Food for thought research can be found here.