Friday, October 7, 2022

At Olive Garden Value Matters


Success does leave clues and when you have run a promotion 25th times aka the ‘Never Ending Pasta Bowl’ promo you know it works.  Yes, success does leave clues at Olive Garden and their consumers want expect value and the marketing team at Olive Garden is doing just what they should do, give them the value they expect, according to Steven Johnson Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.

Once again Olive Garden is bringing back its Never Ending Pasta Bowl promotion after an abstaining for two years, putting an end to questions about whether the offer was gone for good. With sales lagging and customer year over year customer counts falling Olive Garden is once again focusing on the consumer and consumer expectations of the brand to drive top-line sales and bottom-line profits.

Olive Garden CEO Rick Cardenas, stated, “Anything that we do should emphasize our brand equity and be more profitable than they were before,”.

So, the 2022 version of the Never Ending Pasta Bowl will try to accomplish that with a higher price point: An unlimited serving of select pastas will cost $13.99, plus another $4.99 for toppings—meatballs, Italian sausage or crispy chicken. The last time the promo ran, in 2019, it cost $10.99. Will the price, value, service equilibrium drive customer into the stores? Or will the perception of never ending value drive consumers into the stores?

Olive Garden is simply reacting to current market conditions as many chains are pushing value offers to appeal to price-conscious consumers. But they’re charging higher prices than in the past as they look to strike a balance between driving sales and protecting their own profits.

Interestingly, Cardenas emphasized that Olive Garden’s value messaging will focus on generous portions rather than price.Cardenas continued , “We don't anticipate changing our messaging to be a pure value play,” …. “At Olive Garden, it's never-ending craveable Italian food. At [sister concept LongHorn Steakhouse], its quality, and they talk about quality. They don't have to talk about price.”

The consumer is dynamic not static and the return of the promo for the 25th time shows how much the operating environment has changed in the past year. Olive Garden decided to ditch the Never Ending Pasta Bowl in 2021, when its restaurants were busy and short-staffed. Same-store sales that quarter exceeded the same period in 2019, the last time the promo ran.

Times they are a changing as this year is a different story. In its most recent quarter, Olive Garden’s same-store sales rose just 2.3% year over year, and traffic was down 9% compared to pre-pandemic levels. So it is turning to the Pasta Bowl once again. 

It will be available now until to Nov. 20. Pasta options are fettuccine, spaghetti, rigatoni and angel hair, and customers can choose from five sauces: creamy mushroom, traditional marinara, five cheese marinara, traditional meat sauce and alfredo. What is your price, value, service equilibrium?

Looking for success clues of your own? Foodservice Solutions® specializes in outsourced food marketing and business development ideations. We can help you identify, quantify and qualify additional food retail segment opportunities, technology, or a new menu product segment.  Foodservice Solutions® of Tacoma WA is the global leader in the Grocerant niche visit us on our social media sites by clicking one of the following links: Facebook,  LinkedIn, or Twitter

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VALUE Matters

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