Yelp’s Economic Average: Consumers and Restaurants Adapt to the New Normal | modern restaurant management

Consumers described more inflationary experiences in their Yelp reviews in 2021 than ever before, according to fourth quarter 2021 data from the Yelp Economic Average (YEA) report, a benchmark of local economic strength in the United States.new restaurant and food business openings (74,616) were also up 10% from 2020 (67,611). Overall new business growth was close to pre-pandemic levels, declining only 1% in 2021 compared to 2019.

“Restaurant and food businesses continue to adapt to the many challenges they have faced over the past two years,” Pria Mudan, data science manager at Yelp, told Modern Restaurant Management magazine ( MRM). “Our data shows that new restaurant and food business openings increased by 10% last year compared to 2020 – a strong sign that these businesses are adapting to changing conditions. The easing of restrictions and the deployment of the vaccines has allowed many temporarily closed restaurants to reopen and has helped create an enabling environment for new businesses to open as consumers return to dining.”

In the fourth quarter, consumer reviews mentioning an increase in the cost of goods and services increased, reaching a five-year high after falling at the start of the pandemic, a 29% increase compared to the fourth quarter of 2020 and an increase of 49% from the five-year low in the second quarter of 2020. As consumer concerns about inflation hit an all-time high, Yelp data also revealed an increase in the number of people looking for businesses to higher cost.

As the pandemic continues to evolve, more people could start new businesses that meet the needs of their local communities.

“We are seeing an increase in consumer interest in dining options that have been heavily impacted by pandemic restrictions, with communal dining seeing a notable increase in 2021, Mudan added. “Conveyor belt sushi, buffets and food courts all saw an increase in consumer interest last year through to 2020. Interesting to see the increase in consumer searches for higher priced restaurants as consumers also mention the price hike in their reviews. Yelp data shows a 56% increase in searches for top-priced restaurants in 2021 compared to 2019. As people returned to pre-pandemic activities, including travel and events, we observed that people were more willing to spend at higher prices, whether they were dining in or out, or supporting other local businesses in their communities.”

Mudan sees the opportunities ahead for restaurants, hospitality and entrepreneurs.

“In 2021, we’ve seen consumer behavior continue to adapt to the new normal that is pandemic life,” Mudan said. “Our data shows a record spike in mentions of rising prices in reviews as businesses grapple with inflation, alongside supply and labor issues. At the same time, growth in the number of people searching for higher cost businesses on Yelp and renewed interest in travel and events categories could be a positive sign for local economic recovery.

The past year has also seen an increase in new business growth with the return of nightlife, beauty, hospitality and travel businesses. As the omicron variant surged in the fourth quarter, increased consumer interest across multiple categories signaled a return to travel and social activities. In 2021, business openings increased by 8% to 559,715 compared to 517,231 in 2020. . Nightlife (9,344 new businesses), Hotels & Travel (12,396), Beauty (42,540), and Local Services (60,069) categories on Yelp saw the largest percentage increases year over year, increasing by 26, 22, 14 and 15% respectively in 2021 .

“Changes in daily life and business operations as a result of the pandemic have created new opportunities for entrepreneurship in all sectors, including restaurants,” Mudan said. percent above pre-pandemic levels (2019). In previous quarters, we’ve also seen bakeries and dessert shops open at increasing rates – perhaps as people continue to turn their pastry hobbies into new businesses. Both suggest that as the pandemic continues to evolve, more people could create new businesses that meet the needs of their local communities.”

Another lesson: the popularity of food delivery isn’t going down anytime soon.

“Businesses that offer food delivery have continued to open, and consumers now have more options for restaurants and food businesses that offer delivery, and many see it as a safer alternative to dining out,” Mudan said. “Our data also shows that consumer demand for food delivery services remains strong, with consumer interest up 107% in Q4 2021 compared to Q4 2019. As more people s are accustomed to having their food delivered during the pandemic, we expect food delivery to continue to be a popular option for consumers in the coming year and beyond.”

About Imogene T. Bishop

Check Also

How consistent communication can help revive the hospitality industry | modern restaurant management

In the wake of the pandemic-induced economic turmoil, the hospitality industry is suffering from labor …