Customers who ordered one of Taco Bell’s Luxe Cravings boxes spent twice as much with the brand last year. | Photo courtesy of Taco Bell.
Restaurants have been steadily losing customers over the past couple of years, largely wiping out post-pandemic gains. The average location has fewer customers than it did in 2019.
Much of that is due to a loss of their price-value equation. Restaurants raised prices by 13.5% from January 2023 to March 2026, compared with 5.5% grocery inflation over that same period, according to a report on Friday by the consulting firm Bain & Company. That hurt the industry’s price-value equation with a large portion of U.S. consumers, especially those in lower and middle-income households.
Restaurant traffic declined 2.5% at fast-food chains and 1.7% at fast-casual brands, according to Bain. “We have inflation everywhere in the economy,” Chris Bierly, senior partner with Bain, said in an interview. “But restaurants have gone up at double the rate, roughly, of grocery for some time now, and the combination of broader consumer pressures and income and restaurants moving away from grocery at that kind of pace has been a shock.”
That’s not going to get fixed anytime soon. According to a Bain survey, 41% of U.S. consumers said that they plan to spend less at restaurants, and 40% said they plan on cutting back on delivery and takeout. No other category sees that kind of belt-tightening. “There’s no quick win here,” said Lisa Koetter, a senior partner with Bain.
Fixing the price-value equation is not impossible. But it can be difficult and requires patience.
In its report, Bain said that restaurants have to reinvest in the right mix of everyday value, disruptive value, and more personalization to win over consumers. Several big brands have used innovative strategies to provide value to consumers. They aren’t necessarily the cheapest. But they’ve convinced consumers that they are getting something worth the money they’re spending.
Take Taco Bell, for instance. The Mexican fast-food chain has been one of the industry’s strongest performers, with positive same-store sales every quarter since the worst of the pandemic, including at least 4% every quarter since the second period of 2024.
Early last year the company introduced its Luxe Cravings Boxes, which offer a selection of items at $5, $7, and $9. Many of those include newer, innovative items. On average, according to Bain, customers who ordered such boxes last year spent 15% less per order than those who didn’t.
But, according to the firm, they came back to the chain in droves: Those customers went to Taco Bell 2.3 times more than average. And so Taco Bell received twice the spending from those customers overall last year than average.
That’s an important part. Customers may spend less per order. But they come in more frequency and over time that’s more revenue for the brand. “You have to be a little patient,” Koetter said. “You have to let that customer frequency play through.”
One such study in patience was Chili’s. The casual-dining chain introduced its 3- for-Me offer, featuring an entrée, drink, and an appetizer starting at $10.99, in 2022. The company’s stock declined after that. Yet the chain put some marketing behind the offer, tapping into customer frustration about prices. And it put more innovative products on the menu, including the McDonald’s competitor the Big Smasher burger.
The campaign was a huge reason that Chili’s system sales grew more than 20% last year, according to Technomic, without any unit growth (it actually closed locations in 2025).
“It’s really knowing your guests,” Bierly said. “You’re thinking about the right sort of things. But then you have a view that it’s a lab in which success is the only option, and you’re going to keep working at it until you find a formula that drives traffic in your brand.” He noted that the offer is tiered, and most of the deals on the 3-for-Me menu are higher than $10.99. But it is also a place where Chili’s features some innovation, with items like its Big QP Burger or its Spicy Big Crispy Sandwich.
Then there is “disruptive value.” Bain highlighted Domino’s Best Deal Ever promotion, a limited-time deal in which the chain allows customers to get any pizza for $9.99. Traffic to the chain surged in July last year, attracting lower-income consumers. Transactions among low-income consumers jumped 12 percentage points, according to Bain. But they also jumped seven points among higher-income diners, according to Pyxis.
While Chili’s and Taco Bell created everyday offers, Domino’s is an example of an offer that is “almost a shocking social media sensation thing” that can bring in lapsed customers and those who don’t visit very often, Bierly said.
The next frontier for restaurant chains looking to improve their value perception is personalization, something most of the industry is working on through mobile apps and loyalty programs.
Figuring out exactly the right message that brings in the right customers can work both for restaurant guests and the bottom line, Bain said.
Koetter believes this is going to be big in the next couple of years, as more restaurants figure this out and AI helps with the process. “Restaurants and other industries are on the cusp of unleashing the power of this,” she said. “I think the next 12 to 24 months are going to be awesome and exciting and fascinating to see which brands are ready to start unleashing the power.”
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