Restaurants face significant challenges when it comes to setting their menus. Many chains have opted to cut items and tighten their selections in order to protect themselves against rising food costs and increased waste.
Many restaurants, however, while making cuts will also bring back favorites. That’s an easy way to re-energize your customer base as word-of-mouth and social media will let customers know when a fan-favorite item comes back to the menu.
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Darden Restaurants (DRI) Olive Garden has traditionally had a fairly stable menu, The chain has generally used all-you-can-eat deals and pricing promotions rather than limited-time-offers as its key offers.
In the last quarter, however, the company brought back two fan favorites to its menu.
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“During the quarter, Olive Garden launched an updated menu featuring fan favorites, Steak Gorgonzola Alfredo and Stuffed Chicken Marsala, the two most requested entrees that Olive Garden fans asked to bring back. In January, Olive Garden’s marketing featured the return of these favorites, along with Four-Cheese Manicotti for just $12.99 plus a three meat manicotti for a limited time,” CEO Rick Cardenas said during its third-quarter earnings call.
That, however, was not the biggest change the company made in the past quarter.
Olive Garden listens to its customers.
Image source: Shutterstock
Olive Garden adds delivery
Olive Garden has traditionally been a dine-in and takeout restaurant. It has not been offered on the various delivery platforms.
That’s something Darden has changed.Â
“In the first week of February, Olive Garden completed their rollout of Uber Direct, making delivery available in all restaurants except the six locations that cannot offer curbside to go. Our partnership with Uber Direct strengthens Olive Garden’s ability to value their guest time by bringing their favorite dishes directly to their doorstep using Olive Garden’s online ordering platform and leveraging Uber’s delivery network,” the CEO shared.
He also called the Uber (UBER) partnership “ameaningful sales building opportunity over time.” The initial results have been strong.
“Without any marketing support during the quarter, the volume of delivery orders grew week to week, while maintaining a higher check average than curbside pickup orders,” he said.Â
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The chain has begun to market the new service.
“In the fourth quarter, the Olive Garden team started to drive awareness of delivery with modest digital activity and will fully leverage their earned and owned channels to target their biggest fans. This will ensure a smooth transition for the newly launched restaurants and establish a baseline from which they will measure future marketing efforts,” he added.
The company plans a more expansive awareness-building campaign, including TV advertising in partnership with Uber during the fourth quarter.
Olive Garden offers value
In addition to its menu changes, Olive Garden has also tried to support its customers during financially challenging times. That has included offering a deal that has not been on its menu since before the Covid pandemic, a “Buy One, Take One” limited time offer.
“With a price starting at $14.99, guests choose from seven entrees for their dining experience and then take a second entree home. This has historically been a high traffic driving promotion for Olive Garden,” Cardenas shared.Â
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Collectively, all of these efforts have been beneficial for Olive Garden.
“Total sales for Olive Garden increased by 1.5% driven by same restaurant sales growth of 0.6%. Olive Garden’s gap to the industry benchmarks increased significantly following the launch of fan favorites limited time offer outperforming the industry benchmarks by 180 basis points in January and 240 basis points in February. They are maintaining their momentum through the first three weeks of March,” according to CFO Raj Vennam.
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