Monday, June 24, 2013

Darden’s Macro View Equals Continued Consumer Discontinuity

When Foodservice Solutions Grocerant Guru, Steven Johnson wrote in 2009 that “Brinker and Darden were experiencing and ill equilibrium in branding” he was right.  Restaurant consumer discontinuity has continued to evolve into customer migration. Customer migration can be curtailed when a restaurant company focuses on the customer not the economy.

When Darden's, CEO Clarence Otis the operator of the Olive Garden, Red Lobster and LongHorn Steakhouse said “chains expects a macroeconomic environment this fiscal year that will be similar to fiscal 2013, with slow and uneven recovery in both the overall economy and our industry. That means many guests will continue to need and expect us to emphasize affordability."  He may be right the economy appears stagnant, however not as stagnant as Dardens brands. If success leaves clues Darden's justification and rationalization of the economic conditions over brand relevance may be a clue to Darden's future performance. When our Grocerant Guru Steven Johnson wrote in 2009 about Darden the following: 

“What are your customers shopping for and where? One of the things that happens when a restaurant brand becomes complacent is consumers reduce the frequency of visits. What are the signs of a brand becoming sick? What role does brand protectionism play in the restaurant industry? When brand managers and C-level executives utilize justification and rationalization to explain results you know that what they did, didn’t work. 

Brand Managers understand that consumers are dynamic not static. Brands must be dynamic as well. When brands play the wait and see game, the only thing they are truly waiting for is the customer to walk into the store. The problem is it just happens less and less. Focusing on price rather than product and product innovation continues to stifle many a foodservice company. “Johnson was right then and we think he is right now.

Well not much has changed for Darden. With outside eye’s and implemented change Boston Market has been up 9%+ for two years and recently reported sales were up 16%+.  With outside eye’s Domino’s also implemented change and continues to outperform peers with positive same stores sales and even higher growth in earnings per share momentum in a highly competitive sector.  Both Boston Market and Domino’s have repositioned their brands, refocused menu’s, and while focusing on the evolving food consumer, not the economy. When our Grocerant Guru Steven Johnson wrote in 2009 that:

“Food is not out of favor or flavor! What is out; is a style of management mediocrity and compliancy. A brand is a promise that must be on-going dynamic and consumer relevant. The value of the brand is a result from interactive between contemporary relevance of the brand and the consumer.” He was right.

When profit from cigarettes began to decline as a profit generator the vast majority of convenience store channel operators focused on fresh food. Now prepared fresh food is the highest margin and fastest growing sector of their business units. Grocerant prepared food is booming across all channels, Restaurant, Supermarket, Convenience Stores, Dollar Stores, Kiosk and Mobile Trucks. Darden is on the right track with sustainable sourcing which prove well worth the effort. 

Legacy chain restaurants cannot practice brand protectionism in 2013 it is a legacy marketing crutch that worked well in the Golden Era of chain restaurants  the 1960’s, 70’s, 80’s, even the early 90’s but has been proven irrelevant since 1995. Times, the industry, and most important consumers have evolved.    Today chain restaurants must understand evolving consumer nuance including how “The 65 Inch HDTV Syndrome” is as important as integrating “The 5 P’s of food Marketing”. If success does leave clues the customer is dynamic not static is one of them.

Interested in learning how the 5P’s of Food Marketing can edify your retail food brand while creating a platform for consumer convenient meal participationdifferentiation and individualization contact us via Email us at: or visit Johnson, or

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