Save your lunchtime money, spend it on the weekend

Written by Parriva — May 20, 2024
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The rise of hybrid work has kept many bars’ and restaurants’ lunchtime business from recovering to pre-pandemic levels, according to data the digital payments platform Square released Tuesday.

But while weekday transaction volumes from 11 a.m. to 2 p.m. were down 3.3% last year compared to 2019, card taps jumped 4.2% on weekends and 0.3% during weekday happy hours from 4 p.m. to 6 p.m. The Square data comes as foot traffic rebounds in major U.S. cities’ downtowns far faster on evenings and weekends than during workdays, University of Toronto researchers have found.

These signs point to a new normal for Americans’ post-pandemic leisure spending, which has remained resilient despite the higher costs of going out. Fast food chains are launching promotions to lure back diners turned off by price hikes, and alcohol brands are pushing canned cocktails as bar and restaurant menu tabs rise faster than grocery bills.

However, many consumers remain determined to splurge after unplugging from work.

“That’s been the largest transformation in the last four or five years — the consumer habits of office workers,” said Ara Kharazian, research lead at Square, which provides electronic payment systems used by many bars, restaurants and stores. “But that money has gone somewhere else: We’re seeing consumers instead spend money on the weekends.”

Brunch has driven a chunk of the weekend increase, Kharazian said. In 2023, 1.88% of the food and drink transactions Square processed took place between 11 a.m. and noon on Saturdays, up from 1.60% in 2019. Because the company analyzed transaction volumes rather than dollar amounts, its data reflects foot traffic rather than inflation-sensitive spending.

Still, some of the change may have to do with consumers going where the deals are, said Sara Senatore, a senior restaurant analyst at Bank of America.

“Brunch is a much more accessible price point than dinner, because people still want to go out to eat,” she said. “They still want the experience, they still want to congregate with their friends and family.”

 

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