Did Eat Out help out?

The Chancellor last week announced that the government's Eat Out to Help Out initiative had been used 64 million times, the equivalent of once for every person in the UK. Primarily, the scheme had been introduced to revive consumer confidence and support jobs in the restaurant sector.

But has it been a success?

Boosted sales
Many restaurants have reported strong increases in trade between Monday and Wednesday over the past month. The steakhouse chain, Hawksmoor, saw bookings increase 50% compared with July. Data from the software provider, Fourth, found that pubs saw an increase in trade of 26% while Quick Service Restaurant operators saw a 22% rise.

Anecdotal evidence of queues outside popular casual dining chains, such as Wagamama and Franco Manca, suggests that consumer demand has surged in recent weeks – especially among young people. Some eateries have also benefited from a higher conversion of customers eating breakfast and lunch out mid-week. While the overall numbers suggest much of the population used the scheme, the actual number of people will be lower as some individuals used the scheme multiple times a week, and even multiple times a day.

It is unlikely such behaviour will continue now that the scheme has ended but Eat Out to Help Out has provided the initial nudge to some consumers, and shown that eating out is safe and that restaurants have adapted their premises to function safely. What was also observed during the period, particularly in popular staycation locations, was that the more popular pubs and restaurants didn't need to join the scheme.

Affordability
With menu items discounted by 50%, some higher end restaurants became more accessible to a broader range of income profiles during August. It has been possible, for instance, to buy lunch and a drink on Sloane Square for under £10.

Jeremy King, whose high-end restaurants include The Delaunay and Wolseley, has described the initiative as "extraordinarily positive”, adding that it has “unquestionably had an increase in business."

Extension
Such has been the success of the scheme that some restaurants have announced their intention to unilaterally extend it beyond the end of August. Marketing their extension, Franco Manca told customers that `Rishi paid half the bill in August. Franco will pay half in September.' Pizza Pilgrims have also said they will they will offer the discount next month and Grosvenor said it would reduce rents for tenants that continue to offer diners half-price meals until the end of September.

Is it enough?
Despite the popularity of the scheme among some groups, especially young people; there is still evidence that consumer confidence has still not fully restored overall.  Recent data shows that just 27% of consumers feel confident enough to go out to a restaurant, for instance.

To maintain momentum going into autumn, eateries will have to take steps to re-assure customers and be innovative in the use of marketing and promotional activities to maintain sales. The importance of social media and advertising to reach younger consumers who are more willing to venture out, is particularly important.

Eat Out to Help Out has shown the power of a good promotional campaign and we expect many more deals aimed at off peak periods in the coming weeks.

Jamie Parker