Even after recasting its menu and its image with a pulsating $50 million ad campaign, Red Lobster hasn't escaped far enough from its once-stodgy reputation. So the Darden Restaurants chain is pushing the envelope further, creating exotic new fare and an even livelier ad message to break by fall.
Although Euro RSCG Tatham, Chicago's "Escape to Red Lobster" campaign has lifted both its sales and image, it has missed the mark on creating deep-seated emotion, said Ken Mills, VP-marketing at the $2 billion chain.
ADDING FUN, SPIRIT
"We're looking to inject more energy and fun and spirit into the campaign," he said, noting that the agency is hard at work devising new creative that will give Red Lobster a more visceral personality.
In addition, Red Lobster is hoping to snag more business from upscale baby boomers with more sophisticated tastes than the average customer by exploring new menu items such as coconut shrimp with mango salsa, tropical lobster chowder featuring Caribbean spices and Goombay lobster dip, a three-cheese, spinach and lobster concoction.
The aim is to build on the success of the chain's 17-month "Escape" effort, which has helped Red Lobster out of the doldrums. Its sales have risen for nine consecutive quarters and last week it reported a 5% jump in same-store sales for the quarter ended Feb. 27 and a double-digit jump in operating profit.
Company executives anticipate even better numbers next quarter in response to a pair of quirky new TV spots that promote the chain's annual Lobsterfest promotion.
"Since the first execution started airing, we've surpassed our previous all-time sales record twice," Mr. Mills said.
In the first spot, called "Nowhere to Run," which broke in late February, a group of lobsters are shown scuttling across the ocean floor to the '60s Motown tune of the same name. The second ad, entitled "Worshipers," cuts between shots of happy sunbathers baking themselves to lobster red and shots of plump lobster tails. Both are running on national cable TV.
The spots are the only major marketing effort currently driving sales. Mr. Mills said that since late February, when the Lobsterfest promotion began, Red Lobster has posted double-digit same-store sales increases over the same period last year. That makes it the most successful sales promotion in the chain's 30-year history.
The Lobsterfest ads amplify the new marketing philosophy of promoting experience over price. For years, Lobsterfest was a price-driven promotion, and ads reflected it. Now, ads are more playful and humorous to help reinforce the new positioning, said Mike Holsinger, category director-hospitality at Tatham.
To add to the Red Lobster "experience," the company also recently unveiled at one Orlando restaurant, a 25-foot-long, 111/2-foot-high fiberglass lobster mobile dubbed Clawde.
The company's retooling still has a way to go, according to industry observers, who said the competitive environment in casual dining has changed from a decade ago when good food, service and value were the differentiating factors.
"Those are just table stakes now," said Bill Hale, president of restaurant consultancy Hale Group. To stand apart from the growing clamor of competitors, he added, chains must make the food presentation and plating more high energy, more intrusive. "It's more about sizzle."
Contributing: Hillary Chura