After a positive rebound during September, guest sentiment based on restuarant food again became less positive during October when compared with the same month a year ago. Restaurant guests have been less positive of restaurant food during six of the last seven months and the rolling 3-month average is also showing the same trend. This trend could be a reflection of restaurants slipping in their quality and execution, or simply that guest expectations for restaurant food have risen and are harder to meet. The same happened with service; restaurant guests expressed less of a positive sentiment when compared with October of 2016. This is a reversal of the trend reported previously. Service perception has tended to be more positive this year. However, when it comes to that total sum of the restaurant experience, restaurant guests expressed a higher likelihood of returning to those brands they visited during October than they did a year ago. Not surprisingly, October was a very good month for the industry, in which same-store sales growth returned to being positive after sixteen months of negative sales growth results. This improved intent to return sentiment bodes well for the industry that is finally experiencing some upward momentum in its sales and traffic growth.
The third quarter of 2017 was not good for the chain restaurant industry. The industry's -2.2 percent same-store sales growth rate represented the second worst quarter in over five years. Furthermore, it was a troubling 1.2 percentage point fall in sales growth compared with the second quarter's year-over-year growth rate. However, there are brands that are thriving in the marketplace and continue to post robust sales growth. During Q3, the brands in the top 25 percent based on sales growth performance had same-store sales growth that was on average 8 percentage points higher than those brands in the bottom 25 percent of sales performance. And the gap between top and bottom performers actually widened during the quarter. Restaurant guests continue to indicate that service is key to achieve superior restaurant performance. During the quarter, those brands in that same top performing set based on sales had net service sentiment scores that were on average 14.1 percentage points higher than those brands in the bottom-performing group. Regardless of industry segment and service style, those brands that meet (and better yet, exceed) guests' expectations of service continue to be rewarded with repeat visits and increasing same-store sales.
Restaurants guests in the Mountain Plains region remain the most positive in the country. Not only were they the most positive overall, they also had the highest percentage of positive online mentions when discussing restaurant service and value. The region with the smallest percentage of overall positive restaurant guest mentions was the Southeast. This seems to have been due to the overall experience provided by restaurants and not to any one particular attribute among those measured. For the third time in the last four months, Texas emerged as one of the regions with the lowest levels of positive guest sentiment. Same-store sales have improved dramatically in the state as the region recovers from the hurricane, but guest perception has been eroding and could be a troubling factor for sales and traffic going forward.
The Restaurant Guest Satisfaction Snapshot is produced by White Box Social Intelligence™, a TDn2K Product™. WBSI is tracking over 192 brands to benchmark customer satisfaction and is the only online tool that integrates with operational performance data to validate the impact on financial performance. The algorithm determining ranking brands is based on sentiment and determined by White Box Social Intelligence. Brands included in this monthly snapshot must have a total of at least 250 mentions for the month. Restaurants must have a minimum number of units to be eligible as well. DMA rankings consider only the largest 25 areas.