Monday, March 11, 2013

Restaurants Rotating Executives Leaves Legacy Chains Reeling

Red Lobster, Olive Garden, Chili’s and Tony Roma’s have replaced, removed, repositioned c-level managers over the past 7 years some have even relocated corporate headquarters. Each appears to operating under a legacy food CEO retail mind-set “do no harm”.  Well doing no harm has done them no good either. Tony Roma’s has gone from 153 units to 40 during the period.  Who will be next to follow?

Since 2008 the full service restaurant industry particular mid-price legacy chains have seen on average a 2% drop in customer visits each year.  For that particular sector it is a total drop of almost 600 million annual visits which is hovering around 6.4 billion in 2012.

Bonnie Riggs industry leading restaurant researcher with the NPD Group thinks many legacy restaurant chains in the casual dining sector “have not stayed as relevant” in meeting consumer’s needs. Regular readers of this blog know we consumers are dynamic not static.  I ask once again: Why do legacy restaurants practice brand protectionism?

Foodservice Solutions® proprietary research led us to develop the “HDTV Syndrome” consumers want convenience yet they desire social.  Consumers love going out to eat.  Restaurants that drive top line growth and bottom line profits today must elevate brand positioning to reflect 2013-2015 not 1985.
Consumers have a fond affection for Branded Restaurant Concepts. While consumers evolve it is critical that companies move with consumers.   In a new Technomic study found that “More than any other factor, 69 percent of consumers report that dining with friends contributes to a fun, exciting restaurant experience (2013 Menu Positioning & Occasion Driver Consumer Trend Report).

If success leaves clues legacy chains must become more dynamic, social, mobile and digital.  How chains market to customers, is critical. Friends want to eat with friends.  The U. S Census says that 50% of Americans over the age of 18 are single. Is your restaurant chain attractive to, inviting to consumers that are single? Singles of all ages prefer not to eat alone?  Do you make it easy for groups of singles of any age to visit your restaurants?   Rotating executives leaves legacy chains reeling focusing on the consumer is rewarding.
Since 1991 Foodservice Solutions® a Tacoma, WA based retail foodservice consultancy has been the global leader in the Grocerant niche. For product or brand positioning assistance contact via:, the Grocerant LinkedIn page or on Facebook at Steven Johnson, BING / GOOGLE: Steven Johnson Grocerants or Grocerant on Twitter

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