Fast-food stores with a drive-through recovered post-pandemic; Stores without did not

Problem definition. We document a profound, permanent change in the US fast-food consumer demand after the COVID-19 pandemic. In short, after a big pandemic slump, visits to drive-through stores almost recovered to pre-pandemic levels, but visits to non-drive-through stores stayed permanently suppressed. Methodology/Results. We use store-visit data between 2018 and 2022 from McDonald’s, Starbucks, and Dunkin’ Donuts, accounting for about 10% of all US fast-food stores. Comparing December 2019 to December 2022, average monthly visits to drive-through stores changed by a moderate ?4.43% (CI:[?6.46%, ?2.40%]). Meanwhile, non-drive-through-store visits changed by a massive ?48.14% post-pandemic (CI:[?52.33%, ?44.17%]). Consistent with drive-through usage being the operating mechanism, this differential recovery pattern was driven by a 9.36% increase in short-duration visits at drive-through stores (CI: [7.15%, 11.55%]). These results’ magnitudes survive a more thorough difference-in-difference analysis as well as matching on store observables, and their statistical significance survives placebo inference. For perspective, the effects we document are analogous to a migration of 25% of all Starbucks’ customers and 50% of its total revenue from non-drive-through stores to drive-through stores. Managerial implications. Our findings are informative for both businesses and regulators. Businesses can use our findings to shape their service channel portfolio strategy, and regulators can use our findings to shape their urban planning policy.