Limited-time offer, long-time benefits

Jan. 21, 2015

By Erin Hargis, Food IQ insights

It’s no secret that limited time offer strategies have been used in the quick-service, fast casual, and casual dining segment for years. LTO’s offer consumers a way to mix up the usual menu and try something new: from premium add-ons to seasonal offerings, just to name a few. For the operator, LTOs provide a low-risk test site for new ideas and even reach beyond to increase customer loyalty.

Popularity is clear

According to Technomic, LTOs are still clearly beneficial: Nearly half (48 percent) of the 1,000 consumers polled in a recent survey said they had tried a limited-time-offer menu item in the past month, and “more than three in 10 of those ages 18 to 44 had ordered one in the past week.” The report also revealed that millennials and Gen X’ers in particular enjoyed being the first of their friends to try an LTO menu item. 

The sense of immediacy that accompanies the launch of an LTO resonates with consumers and drives them into the doors of all segments. Technomic reports that 52 percent of consumers said their most recent LTO purchase was from a quick-service concept and 18 percent last ordered an LTO at a casual dining restaurant. Finally, 7 percent last purchased an LTO at a fast-casual concept.

Focus on the Season

Seasonal flavors are popular with consumers now more than ever. Tehnomic reports that two-thirds of consumers — including 73 percent of women — said they’d be likely to order limited-time-offer foods that match flavors from the specific time of year. Similarly, three-fifths of consumers, aged 18 to 44, said the same about beverages featuring seasonal flavors.

For operators who serve season-standards (think frozen yogurt), seasonal LTO’s give consumers a reason for them to stay relevant. For example, Chicago-based Forever Yogurt is offering a line of gourmet hot chocolates called Froth. The hot chocolate bar offers an array of flavors and toppings, including Andes mints, Nutella, Hershey’s milk chocolate, Ghirardelli dark chocolate, Nestle Mexican chocolate Abuelita, peanut shavings, and three types of marshmallows. It’s a way for a summer-staple to be relevant, even during the cold Chicago winter.

Try something new

Another benefit of the LTO is the opportunity to show the consumer something new and bold. A perfect example is that of Vermont-based Bruegger’s Bagels, who last summer used an LTO to introduce Sriracha sauce to the menu. The Sriracha Egg Bagel became so popular, that it’s since been added on as a permanent menu item.

The people at Brugger’s used the LTO to take a chance and offer their customers something new, in the end, it worked in their favor. Technomic reports that this risk often works in the operators’ favor reporting: “62 percent of consumers, including more than 70 percent of women ages 18 to 44, said they would be disappointed if an LTO they enjoyed was not available on their next restaurant visit.”

Increase loyalty

Besides the flavor opportunity, LTOs can help ensure customer loyalty, and that’s important. According to Fred Reichheld, author of The Loyalty Effect, a 5-percent increase in customer retention can produce as much as a 100-percent increase in annual profit. The “get-it-before-it’s-gone” sense of immediacy encourages customers to visit the restaurant perhaps more than usual. 

If you’ve ever wondered why the big chains like McDonalds, KFC, and Burger King consistently “bring back” old menu items, it’s most likely thanks to research via social media. Burger King recently launched the hashtag #chickenfriesareback via Twitter. Since the launch, the chain received 380 tweets per minute while racking up 150,000 social media mentions in the first 72 hours alone. It’s the perfect example of a QSR chain knowing its audience and bringing back a once-popular item.

By offering something different on the menu, customers will be intrigued to return and try out the product. Whether it’s an innovative flavor or bringing back an old favorite, customers respond to change. LTO’s not only gives operators the chance to experiment without full menu commitment, but if the LTO is a hit, it might just push a slow-selling item off the menu and take its place.


Topics: Food & Beverage, Marketing / Branding / Promotion, Research & Development / Innovation, Trends / Statistics


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