Cineworld’s closure will have significant fallout for casual dining

Foodservice outlets that relied on the sales boost from cinema promotions let out a sigh of relief as lockdown measures loosened in the UK and cinemas re-opened. However, for major brands connected with Cineworld’s Unlimited card promotions, this was to be short-lived as the delay of big premieres such as No Time to Die caused the temporary closure of the entertainment venue. Other cinemas are also feeling the pressure to encourage footfall. The more the film and cinema industry struggles to find its feet in the new world and get visitor numbers back up, the more these foodservice chains will turn away from once lucrative partnerships seeking a more secure revenue stream, says GlobalData, a leading data and analytics company.

Ryan Whittaker, Consumer Analyst at GlobalData, comments: “COVID-19 has fundamentally altered the foodservice landscape as consumers saw traditional dining locations become potential vectors for disease. According to GlobalData’s COVID-19 impact model, UK foodservice profit operators were projected to generate sales worth $104bn in 2020, but that number has fallen to under $71bn due to the impact of COVID-19.

“The loss of cinemas—or the equally deadly lack of trust of these venues’ safety—is also going to severely impact consumers’ desire to visit many of the retail park locations that host the cinema. Many foodservice outlets at these locations enter into schemes with the cinema, such as through the Unlimited card promotions, and now all of that consumer foot traffic is under threat. We may well see a significant shift in the locations such restaurants can survive in future.”

A number of casual dining chains were in trouble pre-COVID, and the pandemic has accelerated the damage. Gourmet Burger Kitchen and Pizza Hut’s dine-in franchise have announced layoffs and closed restaurants, despite bumps from VAT cuts and the government’s Eat Out to Help Out scheme.

Whittaker continues: “The most recent survey by GlobalData found that 66%** of UK consumers were eating dinner out of the home less frequently than before the pandemic, and, of this total, 22%* said they would stop altogether. UK consumers are finding casual dining increasingly unconvincing in the midst of rising COVID infections and the closure of nearby activities such as cinemas.”

* Covid-19 recovery tracker consumer survey, 12th October 2020

** Covid-19 recovery tracker consumer survey, 12th October 2020, combining answers “I will eat this outside my home significantly less frequently than before” “I will eat this outside my home slightly less frequently than before” and “I will stop eating this outside my home”

More Media