Durham, N.C.-based independent shop McKinney has won creative duties for Ruby Tuesday restaurants after a review.
The agency confirmed the win but declined to comment further, while Ruby Tuesday did not respond to a request for comment by press time.
The review -- which was overseen by Santa Monica, Calif.-based consultancy Select Resources International -- marks the second agency change for the fast-casual chain in the matter of six months. Earlier this year, Ruby Tuesday named New York-based shop People Ideas & Culture its lead creative agency, but within a matter of months the account went into review again.
People Ideas & Culture, did not defend the business. Prior to PI&C, Charlotte, N.C.-based BooneOakley handled the Ruby Tuesday account. Horizon Media remains Ruby Tuesday's lead shop for media planning and buying duties.
At McKinney, Ruby Tuesday joins a roster of clients that includes Sherwin Williams, Lenovo and Nationwide Insurance. The agency is also awaiting a decision on a review for GNC stores.
The recession appears to have taken a toll on Ruby Tuesday's ad budget. Measured media spending for the Maryville, Tenn.-based chain had plummeted in 2009 down to about $2 million, according to Kantar, from $49.6 million in 2007. The chain last year ramped up spending again, to about $12 million, and has spent almost $6 million in the first half of this year.
The hike in spending comes at a time when the chain is suffering from negative same-store sales. Earlier this month, Ruby Tuesday announced fiscal first-quarter profit dropped 75% and same-store sales for company-owned locations fell 4.1%; same-store sales for domestic franchised restaurants fell 3.7%. Ruby Tuesday's last full fiscal year fared better, posting same-restaurant sales up .9%, its first positive same-store results in five years.
"While we're having some success with our marketing strategies, the competitive promotions continue to remain very aggressive and our current promotional programs did not compete as well as those high TV programs of a lot of our competition," said Samuel Beall, chairman-president-CEO of Ruby Tuesday, during an earnings call in early October.
Indeed, the casual-dining landscape has seen a swath of value-oriented ads from the likes of TGI Friday's, Chili's, Applebee's and Red Lobster. He added that in response the chain has been testing value offerings in select markets.
"We just need to get more people in to see what Ruby Tuesday has to offer, and as a result we're shifting our marketing promotional dollars to spend to a different mix to attract more regular casual dining users instead of just the coupon users of the past," said Mr. Beall.
