FEATURE-Value, comfort on U.S. menus this holiday season
* '09 inflation-adjusted food service sales seen off 1 pct
* Experts see more rational discounting through year-end
* From spices to pie, comfort is on the menu
LOS ANGELES, Oct 21 (Reuters) - Chef James Overbaugh is seeing glimmers of economic recovery as the winter holidays approach and will offer dishes at a broad range of prices to draw in diners.
"The price of top-tier quality has moderated a little as a result of the economy," said Overbaugh, executive chef at The Peninsula Beverly Hills luxury hotel.
He has expanded menu prices to accommodate customers, who even at the top end have reined in spending in the worst recession since the Great Depression. Dinner entrees are now priced from the mid-$20s to the $40s, versus $30 to $40.
"I think we are in the beginning of an upturn," said Overbaugh, who is seeing regulars visit more often, "spontaneously busy" week nights and brisker wine sales.
The Peninsula's recipe is being replicated down the restaurant food chain, where luxury establishments and casual dining chains are experimenting with a range of prices, comfort foods and strategies to keep traffic coming in after Jan. 1.
While unemployment and home foreclosures will keep a damper on the holidays, Americans are showing a little more appetite for spending. More industries are hoping for some holiday-related splurges after thrift reigned in 2008.
As a result, some restaurants should benefit from parties and holiday bookings, said consultant Malcolm Knapp.
"They'll recover a little bit on that holiday traffic from last year's drought," Knapp said.
The National Restaurant Association expects 2009 restaurant industry sales to rise 2.5 percent in current dollars to $566 billion. But the group's forecast also calls for 2009 inflation-adjusted sales to fall 1 percent compared with 2008, when such "real" sales fell 1.2 percent.
Many restaurants have been reporting drops in customer counts and average spending per guest. The NRA does not forecast traffic, but one of its recent member surveys showed that only 15 percent of restaurant operators reported an increase in traffic between August 2008 and August 2009.
WARMING SPICES
When the economy went south, the restaurant industry shifted its focus from adventurous extravagance like the Wall Street Burger Shoppe's $180 burger with flecks of gold and the Algonquin Hotel's $10,000 "ice" martinis poured over real diamonds to reworked comfort foods such as macaroni and cheese made from gourmet ingredients.
Maria Caranfa, director of Mintel Menu Insights, predicts that restaurants will put extra emphasis on warming spices and comfort foods like pie to woo customers this holiday season.
"Not only do they taste good, you get that warming sensation like a comforting hug," she said.
Overbaugh is planning holiday meals around free-range turkey from Willie Bird in California's Sonoma County; house-made venison chorizo; and spices like clove, cinnamon, star anise and nutmeg that evoke warm holiday memories.
Early promotions from restaurants also show chains will focus on value and discounts throughout the rest of the year.
One advertised special comes from high-end steakhouse chain Morton's Restaurant Group Inc (MRT.N), which will offer three-course lunches for $25 per person.
"Chains are starting to figure out what they have to do to be attractive to the customer and profitable. It's not all about getting bodies into the store," said Bob Paine, a restaurant consultant at marketing company Affinity Solutions.
Some of those promotions include holiday gift card specials that offer buyers more bang for their buck while giving restaurants guaranteed post-holiday traffic.
At Morton's, a person who buys a $300 gift card from Oct. 6 through Dec. 31 will get a free $50 card that is valid after the holidays.
California Pizza Kitchen Inc (CPKI.O) is running a gift card program also designed to bring customers back in the new year.
Starbucks Corp (SBUX.O), which last year resisted the urge to start selling winter holiday items before Thanksgiving, is beginning this year's holiday blitz two weeks earlier.
The coffee chain will bring back perennial favorites like the Peppermint Mocha and Gingerbread Latte, while also focusing on value-oriented gifts and products that raise money for charity. (Editing by Michele Gershberg and Gerald E. McCormick)
