THE MENU - Urner BarryA trend’s life cycle is defined by where that trend shows up – starting at fine dining restaurants and then eventually finding its way to mainstream supermarket

ADOPTION CYCLE

THE

MENU

bechamel

grits

tzatziki

puttanesca

frittata

garganelli

agnolotti

chimichurriasiago

scrapple

spaetzle harissa

tahinipoutine

togarashi

ponzu

cannoli

oatmeal

gnocchi

pappardelle

chipotle

panini caprese

kale

chilaquiles

quinoa

bratwurst

mochi

churro

chorizo

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a framework for predicting food trends

Society teaches us to spot trends by examining what’s happening today.  What’s the latest fashion craze? What’s the coolest new gadget? What foods and flavors are growing in popularity? But rather than just looking at what’s already happening today, imagine if you could predict the food trends that will define the landscape for the next several years. How helpful would it be to have a new product pipeline that always keeps you several steps ahead of the competition?

The good news is that this capability exists, used by several food companies to build key market advantages. But while the tools are already available today, keep in mind that an organization-wide commitment is required get the most out of them.

Society teaches us to spot trends by examining what’s happening today.  What’s the latest fashion craze? What’s the coolest new gadget? What foods and flavors are growing in popularity? But rather than just looking at what’s already happening today, imagine if you could predict the food trends that will define the landscape for the next several years. How helpful would it be to have a new product pipeline that always keeps you several steps ahead of the competition?

The good news is that this capability exists, used by several food companies to build key market advantages. But while the tools are already available today, keep in mind that an organization-wide commitment is required get the most out of them.

TRENDS ARE PREDICTABLE  2

We’ve written this whitepaper for companies thatseek a proactive approach to trends.  Read on to learn more about the Menu Adoption Cycle and how to apply it to your business.

TIP

Kale, quinoa, aioli, street tacos, sriracha – you probably know them as trends in 2014, but were they already on your radar 8 years ago?

Kale, quinoa, aioli, street tacos, sriracha – you probably know them as trends in 2014, but were they already on your radar 8 years ago?

PREDICTABILITY & THE MACFood trends follow a common life cycle, a predictable journey spanning four distinct stages. We call it the MENU ADOPTION CYCLE (MAC), and it’s proven to be a remarkably accurate tool for predicting the next big thing.

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Why is it called the Menu Adoption Cycle?

2006

Gourmet BurgersSavory Desserts

QuinoaTruffle Oil

2004

Small PlatesApplewood BaconFlavored MayoPomegranate

2005Local & NaturalRetro DessertsWhole GrainsFlavored Salts

2008

Food TrucksBeer-Infused Foods

KimcheeGastropubs

2007Panini

Sweet PotatoTart Yogurt

Butternut Squash

2010

Authentic TacosEggs Everywhere

CharcuterieRed Velvet

2009Hummus

Smoked MeatsPeruvian

Slow Foods

2012

Bone MarrowPork ShoulderCauliflower

Ancient Grains

2011AranciniParfait

Adult Grilled CheeseTater Tots

2013Chef Casual

TzatzikiNon-Alc. Craft Bevs.

Habanero

Over the past decade, the MAC has enabled us to predict hundreds of food trends early in their life cycle. Here are just a few examples from each year.

TIPBecause trends start at restaurants. 70% of US consumers indicate that their food preferences are driven primarily by what they encounter on restaurant menus – more so than what they find on grocery store shelves or in a recipe book. Despite the fact that most meals are consumed at home, trends are generally catalyzed by consumers’ away-from-home experiences.

4STAGES OF THE MACA trend’s life cycle is defined by where that trend shows up – starting at fine dining restaurants and then eventually finding its way to mainstream supermarket shelves and beyond. Knowing where a trend is along the Menu Adoption Cycle (MAC) is the first step to predicting its future.

Trends start here. Inception-stage trends exemplify originality in flavor, preparation, and presentation.

Proliferation-stage trends are adjusted for mainstream appeal. Often combined with popular applications (on a burger, pasta, etc.),these trends have become familiar to many.

3.PROLIFERATION

1.INCEPTION

Adoption-stage trends grow their base via lower price points andsimpler prep methods. Still differentiated, these trends oftenfeature premium and/or generally authentic ingredients.

2.ADOPTION

Ubiquity-stage trends have reached maturity, and can be found across all sectors of the food industry. Though often diluted by this point, their inception-stage roots are still recognizable.

4.UBIQUITY

IN FOODSERVICE:Fine diningEthnic independents

AT RETAIL:Ethnic markets

IN FOODSERVICE:Family restaurantsSchool cafeterias

AT RETAIL:Dollar storesDrug stores

IN FOODSERVICE:Fast-casual restaurantsCasual independents

AT RETAIL:Specialty grocery storesGourmet food stores

IN FOODSERVICE:Casual chain restaurantsQuick service restaurants

AT RETAIL:Traditional supermarketsMass merchandisers

5KEY SEGMENTS & VENUESHere’s a look at where trends typically emerge as they continue along the Menu Adoption Cycle.

Ethnic aisle

Gastro pubsChef-casualFood trucksUpper casualCasual independentsFast casual

LodgingCasual chainsCollegesQuick service restaurantsGrocery deli

Convenience storesCorporate cafeteriaFamily restaurantsHealthcareK-12 schools

PROL

IFERA

TION

INCE

PTIO

NAD

OPTI

ONUB

IQUI

TY

Ethnic marketsEthnic independents

Fine dining

Farmers markets

Specialty grocers

Gourmet food stores

Traditional groceryMass merch

Club stores

Drug stores

Dollar stores

RETAIL

RESTAURANT & RETAIL BRANDSYou can also think about the Menu Adoption Cycle in terms of specific restaurants and stores. Certain places cater to earlier stage trends, while others tend to favor those that are already well-established in the mainstream.

INCEPTION ADOPTION PROLIFERATION UBIQUITY

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PROLIFERATIONINCEPTION ADOPTION UBIQUITY

REST

AURA

NTS

INCEPTION ADOPTION PROLIFERATION UBIQUITYPROLIFERATIONINCEPTION ADOPTION UBIQUITY

RETA

ILER

S

Here are just a fewexamples of what’s trending today.

EXAMPLES (AS OF 2014) 7

Black trumpet mushroomsFilipino cuisineZa’atarTaleggioNon-traditional raguTogarashi

KaleChimichurriPappardellePanna CottaChutneyLobster roll

Flatbread pizzaSrirachaAioliGnocchiRisottoBread pudding

ChipotleSpaghettiPepper jackPaniniAlfredoCajun

INCEPTIONINCEPTION

ADOPTION PROLIFERATION

UBIQUITY

MenuTrends gives you the scoop on thousands of foods & flavors.TIP

Applying the MAC is both a science and an art – that is, it requires a combination of reliable, objective data and an informed, human perspective. While formulas play a role in assigning each trend to its appropriate MAC stage, there’s no universal formula that does the job entirely; human intelligence is a critical part of the equation.

THE SCIENCE

Consider the four trends above, all of which have grown significantly on menus over the past 4 years. Each, however, is at a different stage of its life cycle. Black Trumpet Mushrooms, although up dramatically, are still found only in fine dining restaurants – a clear example of an INCEPTION stage trend.

Kale, meanwhile, has trickled from Fine Dining onto Casual Dining menus, but hasn’t quite made it to QSR and Midscale restaurants. Despite all the press around Kale over the past couple years, it’s still only in the ADOPTION stage, with still a lot of room to grow.

Driven by a meteoric rise over the past 15 years, Chipotle is today clearly already in ubiquity – its smoky flavor available in all types of restaurants across the US. It is firmly established and familiar to most consumers, a flavor that’s less risky but also less unique.

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MAC STAGE4-YEARGROWTH

FINEDINING

CASUALDINING QSR MIDSCALE

Black TrumpetMushrooms INCEPTION +600% 5.1% 0.8% 0.1% 0.0%

Kale ADOPTION +480% 28.7% 11.6% 5.4% 5.0%

Aioli PROLIFERATION +59% 49.1% 28.8% 7.1% 9.4%

Chipotle UBIQUITY +25% 22.2% 31.5% 16.2% 17.1%

The Science: Datassential MenuTrends. Statistical menu data provides the science; quantitative information about what restaurants offer on their menu is the foundation of the MAC. This starts with PENETRATION ANALYSIS (the % of restaurants that offer a specific food, flavor, or ingredient), which is tabulated by key restaurant types that represent different stages of the cycle.

The trend chart for Kale…

… looks vastly different than the trend chart for Chipotle.

9 FINE DINE

CASUAL

TOTAL US

QSR

MIDSCALE

FINE DINE

TOTAL US

CASUAL

QSR

MIDSCALE

0%

5%

10%

15%

20%

25%

30%

35%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

5%

10%

15%

20%

25%

30%

35%

40%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

BOTH KALE AND CHIPOTLE ARE GROWING, BUT ARE AT DIFFERENT STAGES OF THEIR LIFE CYCLE.

Kale’s ascendancy began in 2008, kicking off at fine dining in the INCEPTION stage. The broader market joined the party in 2012, pushing kale into the ADOPTION stage as of 2014.

Chipotle is far more mature. A superstar flavor dating back to the 90s, it has since seen a flattening of its trend line. After years of incredible growth, chipotle is today firmly in the UBIQUITY stage.

TYPICALLY TRUE OF TRENDSRestaurant drivenOrganic growth

Democratize-ableGreater underlying need

TYPICALLY TRUE OF FADSMedia drivenHyper growthRetail catalyst

Limited true need

THE ART 10FADOR TREND?

Just as important is understanding external influences that can either stop a trend in its tracks or supercharge it to the next stage. Here are a few TREND BARRIERS to consider:

While Vension and Yuzu are both increasing rapidly on menus, there simply may not be enough of either to go around if their popularity continues to grow.

Expert trend practitioners are instrumental to bringing the MAC to life. An understanding of what separates fads from trends, the history of specific trends, and the underlying need states driving those trends is enormously helpful in predicting their future course.

Consider the general characteristics of fads versus trends below. How would you classify the Atkins diet, popcorn on menus, or foods with foam?

Have you noticed America’s renewed love affair with bacon over the past few years? Although already ubiquitous for decades, bacon somehow has become quite cool again. But take a look at what’s driving this – the trend-worthy part isn’t so much traditional applications such as bacon on a burger; it’s all of the new uses, such as bacon sundaes, bacon cookies, or bacon jam, as well as emerging ultra-premium cuts of bacon that go beyond standard grocery store fare. An old trend can be reinvigorated when applied in new ways.

On the flipside, there are also several things that can help accelerate a trend forward, such as these key TREND ENABLERS:

Later stages of the MAC rely on large chains to propel the trend forward. Is there enough potential supply to satisfy a McDonald’s or a Walmart? Despite its earlier promises of using 100% antibiotic-free beef, Chipotle was forced to retract its stance because there just wasn’t enough supply available to satisfy its needs.

Certain trends, by virtue of what they are, will be inherently challenged to make it out of the INCEPTION stage. Bone Marrow is a great exam-ple; although up dramatically over the past few years in fine dining restaurants and gastro pubs, many consumers will dismiss it as being just “too weird”.

The explosion of Sriracha over the past decade was made possible by not only people’s love of its flavor, but more specifically their love of its flavor on an astonishingly broad cross-section of foods. Srira-cha is right at home with everything from sandwiches to breakfast dishes, and it’s this versatility that has helped transform it from a niche condiment to one of the fastest growing flavor profiles over the past 10 years.

ARE THERE SOURCINGCONSTRAINTS?

CAN IT FIND NEW LIFE LATE IN THE CYCLE? IS IT VERSATILE ACROSS DAY PARTS AND APPLICATIONS?

IS THERE ADEQUATE SUPPLYTO SATISFY KEY PLAYERS?

CAN IT BE OFFERED IN AN EASILYRELATABLE FORMAT?

11The INCEPTION stage is a stumbling block for many trends; although well-suited for higher-end restaurants, they may be prove challenging to adapt for a broader audience. On average, only 30 to 40% of trends make it out of Inception.

But once a trend hits Adoption, there’s an excellent chance it will continue to grow. Most such trends progress into Proliferation, and the vast majority of those will ultimately march on toward Ubiquity.

TREND EVOLUTION

continue on30-40%

continue on80-90%

continue on60-70%

Inception-stage trends are largely authentic, generally adhering to traditional preparations (even if the applications are unique)

What is lost in authenticity is often made up for in other forms of culinary creativity

Now fully mature, the trend is often heavily diluted at this point – and may bear little resemblance to what it once was in Inception

INCEPTION ADOPTION PROLIFERATION UBIQUITY

The dilution process begins as restaurants and food suppliers focus on familiar notes to satisfy the masses

CREATIVELYADAPTED FOR THE MASSES DILUTEDAUTHENTIC

TIPThe journey from INCEPTION to UBIQUITY is not static. Trends morph significantly during their lifecycle. Consider the case of chipotle; what started as a smoked pepper found in fine dining restaurants has since transformed into a flavoring for mayo and other sauces.

12TREND ACCELERATION

More than ever, speed matters. Food companies used to be able to wait for trends to mature before making their move, but today that’s no longer a smart course of action. As trends continue to accelerate, speed has emerged as a potent competitive advantage.

Organizations that adopt trends earlier are far better able to capitalize; those that wait too long, on the other hand, risk not only having those trends pass them by, but also allowing their brands be perceived as tired and old.

We believe that’s changing, with the sweet spot shifting one stage earlier to ADOPTION. It’s clearly starting to happen, as evidenced by America’s growing appetite for ethnic foods and more adventurous dining. If you want to play in the sweet spot, it’s time to start shifting your brand toward Adoption.

TRENDS ARE MOVING FASTER THAN EVER! Here are a few reasons why

The non-white population is projected to grow by 50 million by 2050, bringing with it a greater interest in trending ethnic foods & flavors

BOOMING ETHNIC POPULATION1ACCULTURATIONThose ethnic consumers are also becoming more acculturated – which generally coincides with greater away-from-home dining frequency2

3 URBANIZATIONMore consumers are migrating to dense city centers, where new food trends are adopted at a faster rate

4 FOOD CULTUREThe era of foodie-ism has clearly arrived, fueled by the boom in food shows, food blogs, and the elevation of food as a social driver

5 MOBILE TECHNOLOGYInstagram, Yelp, Foodspotting, Foursquare, and a growing number of mobile apps let consumers share their food experiences faster than ever

ADOPTION – THE NEW SWEET SPOT.For the past 30 years, the sweet spot of the American consumer’s appetite has fallen squarely in the Proliferation stage – safe, mainstream foods that are at most only slightly progressive.

Historically, trends generally took around 12 years to move through the Menu Adoption Cycle. In recent years, however, that horizon has compressed significantly – we believe the cycle time will be trimmed in half to just 6 years.

13Applying the MAC requires a well-calibrated analytic framework, starting with a high-quality restaurant menu database.

DATA TOOLS

8 YEARS HISTORYOR LONGER

Trend prediction requires historic perspective, and in particular the ability to track each trend’s prior movement. Is it just a flash in the pan or a true trend? Historic data is essen-tial to make that determination.

STABLECOMPOSITION

Restaurants each period should remain constant; changing the composition of the data-base will cause unwanted shifts in the data that make it impossible to determine if the trend is actually up or down.

CENSUS-BALANCEDSAMPLE

The menus should mirror the national restaurant census. This means having a proper balance across segments, menu types, and geographic regions… as well as by chain vs. independent restaurants.

COMPLETEMENUS

Was the kids menu captured for each restaurant in the database? How about the separate bar menu or dessert menu? Proper penetration tracking requires a complete menu for every location.

ADEQUATESIZE

For US restaurants, you’ll need a data set of at least 4,000 distinct menus. If the database is properly balanced and maintained, this size produces reliable readability by segment and major census region. To analyze trends by individual states or metro areas, however, you’ll want a far larger data set of at least 60,000 distinct menus.

MenuTrends DATASSENTIAL INNOVATION TOOLS

10x larger than other menu and flavor databases

15 million menu examples from more than 100k menus

LTOs new and limited-time items updated weekly

The industry’s most accurate system for identifying, tracking, and predicting flavor trends

FS

CPG

WE KNOW FOODFOOD TRENDS | CONSUMER & OPERATOR INSIGHTS | SMARTER INNOVATION

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