Despite consumer enthusiasm for enjoying restaurant meals, diners should consider the full cost of dining out this holiday season.
In a PR Newswire survey asking about consumer plans to dine out this holiday season, 65% of respondents indicated they were enthusiastic about enjoying restaurant meals this season.
But they might not be aware of what is fast becoming an industry-wide practice: raising prices and reducing portion sizes during the holidays.
An Increase in Holiday Exploitation
Holiday exploitation has been ramping up since the COVID-19 pandemic. What was once a practice of upscale restaurants alone now seems an industry-wide practice during the winter months, says marketing automation company Movylo.
According to Movylo, restaurants throughout the industry not only raise prices during the holidays but reduce portion sizes in the hopes of packing in as much holiday profit as possible.
Reasons for this holiday exploitation include trying to survive in an increasingly competitive market. Operational costs, labor, and rent all play a part in the rising cost of running a restaurant. To get ahead of financial strain, restaurants fluctuate pricing and portions during the time of year when consumers seem more willing to pay extra despite many struggling financially.
The Impact of Holiday Exploitation
Movylo says consumers feel more pressure during the holidays to participate in festive functions, like spending money on restaurant meals. However, holiday exploitation comes with risks, not only to consumers but also to the restaurants that participate in this practice.
While consumers feel the financial pinch of eating out, Movylo says restaurants risk reputation and repeat customers when they raise prices and reduce portion sizes during the holidays, making their short-term gains less likely to produce longevity and survival in a competitive market.
Consumers Return to the Kitchen in 2024
A 2024 Innova Marketing Insights study shows that, while enthusiastic about restaurant meals, consumers may be more likely to return to the kitchen this year in the hopes of stretching their hard-earned dollars.
Two-thirds of consumers reported spending more on food in 2024 than the previous year due to inflation. In response, 50% of consumers have increased the amount of meals they eat at home due to these price hikes.
Trend data indicates consumers are cooking more from scratch this year. Innova reports those with existing kitchen confidence are most likely to cook from scratch, but generationally, baby boomers are most likely.
Alex Caspero of Delish Knowledge says, “I love cooking at home, but especially during the holiday season, as it’s a way to control spending during an already expensive part of the year. Even if I’m making a fancy meal at home, it’s still less expensive than going out to eat. My husband loves scallops and I can serve over a pound of them at home for the same price as 4 or 5 scallops at a restaurant. They are just as delicious and worth the extra effort for the savings.”
Holiday Cooking in 2024
Many consumers are turning to their home kitchens for holiday meals this year. According to global data company Statista, 88.9% of Millennials and most Gen Zers plan to cook a holiday dinner this year.
Alicia Richards of Travels With The Crew says, “I plan to make Thanksgiving Dinner with my sisters. That way it isn’t as overwhelming and we get to work and chat the entire day.”
Sharing the responsibility for preparing the meal is a great way to enjoy the holiday. But what are Americans preparing for this holiday season?
Thanksgiving isn’t complete in the American home without a turkey, but mashed potatoes and stuffing are the most popular sides. Nearly 60% of Americans also say chicken is an essential holiday protein.
Almost half of respondents (46.3%) named apple pie the top Christmas dessert. However, 55.8% put pumpkin pie in the No. 1 spot for Thanksgiving desserts.
Whether dining out in restaurants or cooking meals from scratch at home, you’ll most likely spend a pretty penny this holiday season, especially if you have many mouths to feed. Still, cooking at home can be the most cost-effective measure for stretching your dollars during the holidays.
