Who’s Winning in Late Night?
Most restaurant sales happen during Lunch or Dinner but ~11% of sales in 2021 took place after dinner (a larger share than breakfast sales). We call these sales that take place between 9pm-5am, “Late Night” sales and it has seen steady growth over the past 2 years. In December 2021, Late Night saw a ~13% YoY increase in sales.
Indexed Sales by Daypart
United States, January 2020 - December 2021
So, who is actually focusing on late night sales growth? And who is winning?
Late Night vs. Total Sales Share
United States, Third Party + Select 1P merchants, January 2021 - December 2021
Domino’s only sells directly from their own platform; they don’t rely on third party platforms
When customers have a late night craving, the restaurant they most often go to is Domino’s - representing about 9% of Late Night Sales. Domino’s over-indexes in late night sales having a lower share of total sales (7.7%) than in late night. McDonald’s and Taco Bell also hold a larger share of Late Night sales than their share of overall sales. Other top brands like Chick-fil-A have a higher share of total sales (5.8%) than McDonald’s and Taco Bell but have a much lower share of Late Night (2.5%). Unlike the top players in Late Night, Chick-fil-A has a much earlier closing time, so catering to customers at this time is likely not a priority to them.
A customer looking for a meal in the late hours is likely to stumble upon the brands on some relevant carousels on third party platforms. McDonald’s and Taco Bell feature in high positions in the “Late Night Cravings” carousel on DoorDash, which likely plays a big part in their prominent positions for this meal time.
As customers increasingly rely on delivery for Late Night meals, the big players are going to want a bigger slice of the pie which will have the space continue to heat up. However, labor shortages are plaguing the restaurant industry, making it difficult to stay open for late night meals. Those who can stay open, and especially those who have capitalized on the visibility afforded by 3P platforms, have carved out a niche as the go-to for Late Night meals.
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