Sandwiches, Subs and Wraps - US

Sandwiches, Subs and Wraps - US

With more than half of all consumers purchasing a sandwich, sub or wrap away from home in the past week, the market for restaurant sandwiches, subs and wraps remains strong. The market has grown continuously from 2001 to 2007, but there is still great potential for further expansion. Portability, convenience and health perceptions have all contributed to the industry’s unique ability to adapt to shifting consumer expectations and food trends. These attributes will likely play a role in the future of sandwich, sub and wrap restaurants nationwide.

This report looks into sandwich, sub and wrap restaurants to uncover:

• What marketing strategies are currently used in the industry and which messages and tactics will be most successful in the future
  
  
• Who’s attracted to sandwiches, subs and wraps and why they choose them over other options
  
  
• How the core sandwich, sub and wrap audience can be developed beyond young adults
  
  
• What people think about sandwich, sub and wrap restaurants, including attitudes that drive them to enter or not enter the restaurants
  
  
• How grocery delis and convenience stores compete with sandwich, sub and wrap restaurants
  
  
• How the changing shape of the U.S. population will impact the industry
  
  
• Where sales have been and where they’re going for both standard and premium chains

This report builds on the analysis presented in Mintel's Sandwiches, Subs & Wraps—US, April 2005. It examines commercial dining at sandwich, sub and wrap restaurants in the US, including full-service, quick-service and delivery/carryout restaurants. The focus of this report is on large sandwich chains, but discussion of independents and small chains is presented where relevant. Unless specified otherwise, all sales figures are for system-wide sales. This report excludes sales of frozen or ready to eat sandwiches through supermarkets, other retail channels and institutions.  
 

SCOPE AND THEMES

What you need to know

Definition

Resources used for The Consumer sections

Abbreviations and terms

Abbreviations

Terms

EXECUTIVE SUMMARY

The public’s hungry for sandwiches, and there’s still room at the table

Growing fast

What types of restaurants are we talking about here

Influencing which sandwich concepts make it to your menu

Far beyond old-fashioned sandwich-board advertising

Who orders these sandwiches, subs and wraps

High incomes aren’t necessarily most coveted in this industry, but present opportunity

What convenience means in the sandwiches, subs and wraps business

Premium is at a premium

Looking at sandwich, sub and wrap places as more than just a sandwich

Follow-through needed with teen girls

Black, Hispanic, and Asian customers all lead the category

MARKET DRIVERS

Convenience, the industry’s biggest asset

Lots of stores is great, but drive-thrus might be nice

Figure 1: Number of sandwich, sub and wrap restaurant units operated by the 13 leading chains, 2004-06

Convenience stores

Figure 2: Number of convenience stores, 2001-06

Serving a health-conscious audience - and how “healthy” can be a risk

Figure 3: Attitudes regarding healthy eating, 2002-07

Industry risk in “healthy”

Growth of Mexican flavors for most dining sectors

Figure 4: New Mexican cuisine menu introductions, by dining type, Q1 2006-Q3 2007

Duking it out over day parts

Significant growth potential

Figure 5: U.S. population and projections, by age, 2002-12

Continually rising gas prices will dampen motivation to dine out

Figure 6: Impact of fluctuating gas prices on consumer expenditures, May 2007

MARKET SIZE, FORECAST AND TRENDS

MARKET SIZE AND FORECAST

Total market

Figure 7: Total U.S. retail sales and forecast of sandwiches, subs and wraps, at current and constant prices,

2004-09

Standard chains

Figure 8: U.S. retail sales and forecast of standard sandwiches, subs, and wraps, at current and constant prices,

2004-09

Premium chains

Figure 9: U.S. retail sales and forecast of premium sandwiches, subs, and wraps, at current and constant prices,

2004-09

FUTURE TRENDS

The supermarket’s potential big bite out of the sandwich market

The influence of diverse ethnic palates

Driven by a desire for “something different”

Figure 10: Culinary-cultural representation of Panera Bread menu, 2007

Major chains investigate wrapping the market

MARKET SEGMENTATION

Figure 11: Price range and average price of sandwich items for leading fast casual and QSR chains, Q3 2007

Figure 12: Sales of sandwiches, subs and wraps, segmented by price level, 2004 and 2006

SUPPLY STRUCTURE

Standard chains

Figure 13: System-wide sales of standard sandwiches, sub and wrap chains in the U.S., 2004 & 2006

Unit sales add depth to the story

Figure 14: U.S. system-wide units and sales per unit of leading standard sandwiches, sub and wrap chains,

2004 and 2006

Figure 15: Average price for sandwichs, subs and wraps in QSR, Q3 2007

Premium chains

Figure 16: System-wide sales of premium sandwiches, sub and wrap chains in the U.S., 2004 & 2006

Unit sales add depth to the story

Figure 17: Store counts of premium sandwiches, sub and wrap, 2004 and 2006

Figure 18: Average price for sandwichs, subs and wraps in fast casual, Q3 2007

Company profiles

Subway

Arby’s

Quiznos Sub

Blimpie Subs & Salads

Panera Bread

Atlanta Bread Company

Schlotzsky’s Deli

Au Bon Pain

Corner Bakery Cafe

Cosi Inc

Einstein Bros. Bagels

Jason’s Deli

Potbelly Sandwich Works

ADVERTISING AND PROMOTION

OVERVIEW

PROMOTIONAL TACTICS

Subway

Arby’s

Panera Bread Co.

Quiznos

Blimpie Subs and Sandwiches

Einstein Noah Restaurant Group

TELEVISION

Figure 19: Arby’s television ad, 2007

Figure 20: Arby’s television ad (2), 2007

Figure 21: Jimmy John’s television ad, 2007

Figure 22: Mr. Submarine television ad, 2007

Figure 23: Quizno’s television ad, 2007

Figure 24: Quizno’s television ad (2), 2007

Figure 25: Subway television ad, 2007

Figure 26: Subway television ad (2), 2007

Figure 27: Subway television ad (3), 2007

THE CONSUMER - WHO EATS SANDWICHES, SUBS, AND WRAPS

Away from home buyers of sandwiches, subs and wraps

Figure 28: Purchase incidence of sandwiches, subs, and wraps by gender, November 2007

Figure 29: Purchase incidence of sandwiches, subs, and wraps, by age, November 2007

Figure 30: Purchase incidence of sandwiches, subs, and wraps, by income, November 2007

Away from home buyers of sandwiches, subs and wraps - by restaurant

Figure 31: Where have you purchased a sandwich, sub or wrap made outside of your home in the past 30

days , November 2007

Figure 32: Sandwich, sub or wrap restaurants visited in the past 30 days, by age, November 2007

Figure 33: Sandwich, sub or wrap restaurants visited in the past 30 days, by household income, November 200746

Frequency of visiting sandwich, sub or wrap restaurants

Figure 34: Number of visits to sandwich, sub or wrap restaurants in the past 30 days, November 2007

Which of these are among your favorite place to eat

Figure 35: Sandwich, sub or wrap restaurants visited in the past 30 days that are among your favorites,

November 2007

Other places of sandwich purchases in the past 30 days

Figure 36: Other places where sandwiches, subs or wraps were bought in the past 30 days, by age, November

2007

Figure 37: Other places where sandwiches, subs or wraps were bought in the past 30 days, by income,

November 2007

Teen incidence of visiting sandwich, sub and wrap chains

Figure 38: Teen incidence of visiting sandwich, wrap and sub restaurants in the past 30 days, by gender, age,

and race/ethnicity, May 2006-June 2007

THE CONSUMER - ATTITUDES AND PREFERENCES

Importance of sandwich restaurant location and cost

Figure 39: Importance of restaurant location and cost, by gender, November 2007

Figure 40: Importance of restaurant location and cost, by age, November 2007

Figure 41: Importance of restaurant location and cost, by income, November 2007

Attitudes about gourmet ingredients and presence of premium bakery items

Figure 42: Attitudes about gourmet ingredients and presence of premium bakery items, by gender, November

2007

More than just a sandwich place

Figure 43: Attributes that sandwich buyers would like to see added, November 2007

BLACK AND HISPANIC CONSUMERS

Figure 44: Purchase incidence of sandwiches, subs, and wraps, by race/ethnicity, November 2007

Figure 45: Sandwich, sub or wrap restaurants visited in the past 30 days, by race/ethnicity, November 2007

Figure 46: Other places where sandwiches, subs or wraps were bought in the past 30 days, by race/ethnicity,

November 2007

Figure 47: Attitudes about gourmet ingredients and presence of premium bakery items, by race/ethnicity,

November 2007

Figure 48: Attitudes about gourmet ingredients and presence of premium bakery items, by race/ethnicity,

November 2007

REGIONAL CONSUMER OBSERVATIONS

Figure 49: Sandwich, sub or wrap restaurants visited in the past wek, by region, November 2007

Figure 50: Sandwich, sub or wrap restaurants visited in the past 30 days, by region, November 2007

Compared to other regions, individuals living in the Northeast are most likely to:

Compared to other regions, individuals living in the Midwest are most likely to:

Compared to other regions, individuals living in the South are most likely to:

APPENDIX: MENU INSIGHTS

Figure 51: Nutritional health claims for sandwiches, subs and wraps at fast casual and QSR, Q3 2007

Figure 52: Most popular type of wraps and sandwiches at fast casual and QSR, Q3 2007

APPENDIX: SIMMONS COHORT ANALYSIS

Figure 53: Sandwich, wrap and sub restaurant patronage, by key user cohorts, May 2006-June 2007

Figure 54: Sandwich, wrap and sub restaurant patronage, by key user cohorts, May 2006-June 2007

APPENDIX: TRADE ASSOCIATIONS