Recession-sapped diners will splash a little more cash eating out this holiday season, and restaurant chains will cash in by offering special festive flavors to keep consumers coming back for more.
From Starbucks' Christmas blends to egg nog ice cream shakes at Jack in the Box
Companies across the board will be looking for a festive fillip after same-store sales dropped significantly in the past two years, said KeyBanc Capital Markets analyst Brad Ludington.
Consumer spending on restaurants, whether its fast food or full service, is probably going to rise 4-5 percent this holiday season from last year, said IBIS World analyst Nima Samadi.
Value is very important, of course, but just through this holiday period I think people put a bigger weight on the value of experience versus the dollar value of the food, said Stifel Nicolaus analyst Steve West.
The one jarring note among the jingle of the cash-tills this year, though, is that Christmas itself falls on a Saturday.
Analysts cited Starbucks Corp
Kurt Salmon strategist Todd Hooper, who covers the restaurant sector, said chains that club social networks into their marketing will see the best traffic.
Social media is even stronger than last year ... also special deals through Groupon and LivingSocial and the like will be more prominent for restaurants this season, he said.
Hooper's picks include BJ's Restaurants
Coming out of the holidays and into next year, the winners will be chains that offer the richest experience -- service, atmosphere, good bar/lounge activities ... they will be the differentiators, Hooper said.
Food is always important, but not the whole story.
Putting a dent in business for some, however, is that families tend to stay home on Christmas Day, a Saturday this year.
Fridays and Saturdays are typically the busiest days for restaurant chains.
California Pizza Kitchen, PF Chang's China Bistro and BJ's all expect this to temper sales.
The holiday shift should hurt both BJ's and Buffalo Wild Wings, but I'd say more for Buffalo Wild Wings, said Oppenheimer analyst Matthew DiFrisco.
Buffalo Wild Wings depends on customers flocking to its bars to watch big-screen televised sports events, much of it held over the weekend.
Even during the recession, Friday and Saturday nights were still pretty strong, but we saw the weakness in weekday lunches and dinners, said Stifel's West. If a weekend night is taken out of the equation, that's a big deal.
(Reporting by Nivedita Bhattacharjee and Renju Jose in Bangalore, Editing by Ian Geoghegan)