In recent times, Gen Z has been rewriting the dining out rule book: they tip less, prefer to pay digitally, and prioritise saving money above all else. As purse strings tighten, this generation will continue looking to get the most bang for their buck - all while receiving a tailored experience suited to their preferences. If restaurants want to appeal to a money-savvy younger generation, creating personalised, digital-first experiences and offering value will help ensure they keep coming back.
How Gen Z is dining smarter
Inflation has changed Britain’s relationship with dining out. New research from Lightspeed recently found that 58% of respondents are cutting back on dining out due to cost pressures and 44% are expecting to spend even less on trips to local eateries in the next six months as they worry about mounting expenses. This penny-pinching attitude is seen even more so with Gen Z, who are laser focused on spending as little as possible - 34% will only pay for the things they have ordered when dining with others, and 36% think tipping should be eradicated. Moreover, 58% have ordered from the kids’ menu, with 44% of respondents citing that it’s a way to save money. These tactics are some of the ways the younger generation is still enjoying a dining out experience without breaking the bank.
Rewarding the digital-first generation
With increased supply chain costs affecting the hospitality industry, simply slashing prices isn’t an option for many restaurants. But it’s not all doom and gloom - 54% of Gen Z are expecting to increase or maintain how often they dine out, highlighting an opportunity for restaurants to capitalise on the younger generation’s love of trying new foods and experiencing new places.
Some of the key cost saving tactics Gen Z are employing when dining out include opting for value deals like prix fixe meals (40%). This generation loves a bargain, and promotional tools like this are a great strategy for keeping them engaged and coming back to your establishment.
Loyalty programs are another effective tool for fostering repeat business, but keeping them simple is key. Traditional stamp cards might have had their moment, but Gen Z diners could appreciate digital, app-based systems that are easy to access on their phones and navigate. New and
innovative apps now allow businesses to create tailored programs offering everything from free menu items, to exclusive discounts. Start small with easily redeemable rewards, like a free dessert after 10 meals, and scale up to include tiered benefits that encourage higher spending even with a more frugal generation.
Tech-led dining for seamless service
As a digital first generation, it’s no surprise that a third (33%) of Gen Z want to pay with a smartphone or digital wallet when dining out. Having a tech-first payment and ordering solution at your establishment is a bonus for customers and staff, since it improves the service flow, reducing congestion and enhancing efficiency. Diners can browse the menu, place their orders, and settle their bills seamlessly, all from the convenience of their phones.
New tools like Lightspeed Tableside give restaurant owners the ability to settle the bill, take orders or split the bill anywhere from a mobile device - saving time from going back and forth to a central POS. When hosting Gen Z customers who love convenience and a digital-first approach, seamless integrations like this can keep them satisfied with their full restaurant experience.
Personalisation as the standard
The hospitality industry is resilient and ever-changing. In an era of shifting customer demands and trends, one that is here to stay is personalisation. In the next five years, younger people want to see their restaurant experience truly adapt to them, with more than just tailored offers or discounts. A third (33%) would like restaurants to offer personalised menus tailored to their preferences and needs upon arrival, and 38% feel as though their diversities could be supported with neurodivergent-friendly spaces in restaurants. Restaurant owners who want to attract and retain Gen Z loyalty should consider how they can create an atmosphere that reflects inclusivity and flexibility.
Gen Z may be frugal, but they’re far from disengaged. This is a generation that still values dining out, but they want it on their terms: affordable, efficient, and personal. Restaurants that lean into digital innovation, reward loyalty smartly, and design experiences that reflect individual needs will stand out and can keep Gen Z coming back for more.
Liam Crooks is managing director of EMEA Hospitality at Lightspeed