Executive Summary
- In this report, we rank the top 58 QSRs in the US on how well their overall customer value propositions position them for future-looking, long-term, sustainable market share growth. Traditional QSRs are considered, as are convenience stores which receive a clear majority of their customers as meal mission destinations. This means that our ranking of 58 includes 51 traditional QSRs, as well as 7 leading convenience stores effectively blurring the lines with QSRs. They are all referred to as QSRs throughout the report.
- Over the past 5 years, top quartile QSRs have seen their foot traffic grow by an average of 5.9% per year, compared to only 0.2% growth for bottom quartile QSRs and 1.8% growth for third quartile retailers. This equates to, on average, 6x times faster growth than most retailers in the market. Top quartile QSRs also secure superior trust, attachment (sad if closed), and draw with its customers.
- The 1st Quartile of QSRs has stronger customer perceptions in those pillars that matter more for driving reach, growth, and emotional connection. The pillars of the QSR customer value proposition, in order of importance, are: Quality Experiences/Products, Visibility, Convenience/Speed, Affordability, Product Variety, and Frictionless Experience.
- The 1st Quartile is a mix of retailers: convenience stores blurring the lines with QSRs – like Buc-ee’s, Wawa, Sheetz, and Kwik Trip – and traditional QSR household names – like Chick-fil-A, In-N-Out, and Raising Cane’s. There are four clearly different strategies employed by QSRs to land in the 1st Quartile. Some of the retailers in the 1st Quartile wield just one of these strategies, but the retailers who are clearly separated even from other 1st Quartile QSRs wield two of the four strategies.
- The 4 major strategies are: (1) Quality Excellence (2) Leading Convenience + Product Variety (3) Leading Affordability + Steady Benefits Performance (4) Strong Quality + Product Variety + Highly Visible in Communities and Mindspaces. A focus on breakfast and in-between meal occasions, trading-off from a focus on the dinner occasion, is also a hallmark of the 1st Quartile, compared to other Quartiles.
- The top 5 overall are: Buc-ee’s, Kwik Trip, In-N-Out, Raising Cane’s, and Chick-fil-A. Overall, 5 convenience stores that are blurring the lines with QSRs break into the 1st Quartile, along with 9 traditional QSRs. This underscores the point that the traditional QSR space is ripe for disruption from convenience store chains that go all-in on blurring these lines and do it with the right areas of focus, which this report helps illuminate.
- Visibility leaders, Buc-ee’s and Starbucks, use social media and branded products, paired with strong Quality and Product Variety, to steal missions away from traditional QSRs. They are leading the “fourth place” of social media reels and mindspace, and they show up in peoples’ homes and communities on branded merchandise. Using this pillar to help them ride to some industry-leading results (visit frequency for Starbucks and emotional connection for Buc-ee’s) highlights some disruptive ways QSRs can cut into the market share of historical, traditional leaders.
- Traditional pizza joints clearly have a lane. They form the majority of leaders in the Affordability and Frictionless Transactions pillars. However, none make it into the 1st Quartile overall, since they are mostly in the bottom two quartiles in the most important pillar: Quality Products/Experiences.