Red Lobster Case, Marketing 503

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Phase two’s main focus was to re-position the company’s food around “freshness.” In order to re-position the company around “freshness,” Salli Seta, established chef parameters to ensure that every piece of fish is cooked exactly the same way each and every time no matter which restaurant the guest was dining at. In addition to setting parameters for the chefs in each restaurant, a specific team sought out to develop a new menu around freshness. The team first de-emphasized all fried food items off of the menu and remarketed the menus which included new wood-fire grilling as a cooking method. Wood-fire grilling was introduced after researching the many different ways to cook seafood, the results concluded that wood-fire grilling was the most consumer-preferred way of cooking. In this phase, new grills were installed in each restaurant nationwide, more importantly a new position was added to the restaurant called “grill master.” The “grill master” was solely in charge of grilling, and each restaurant contained about five dedicated “grill masters”. Setta also made changes to the menu’s language and updated the pictures so that it would be appealing to all guests. Setta created a menu that stated daily specials with a statement like “Today’s regional catch” and listed on the menu who was preparing the item that day. Using this language gave the perception to customers that food was prepared with culinary expertise and met quality standards. Promotions were reduced significantly down to only two promotion options, which included “Lobersterfest” and “Endless Shrimp.” Lastly, during this phase around 2008 new television advertisements were developed that showcased the new menu which focused mainly on the marketing efforts made in this phase. The ads were meant to introduce the new grilling method as well as advertised a huge emphasize on “freshness.”

Phase three consisted of re-modeling the restaurants. The remodeling method was to create a nice enough atmosphere to celebrate a special occasion but also comfortable enough to where guests did not think that they needed to dress up in order to dine at the restaurant. Lastly, the atmosphere was created around the concept of creating a comfortable seaside atmosphere.

Overall I believe that the current marketing strategies can be improved in order to strategically target the appropriate market. I believe that “freshness” was a huge priority to all casual dining guests and the emphasize on re-positioning the company in such a way was a great idea. The re-modeling of all restaurants was necessary, even though the cost of the re-modeling job was quite substantial. I believe promotions could have been trimmed or completely eliminated, so that the restaurant was not perceived as low quality or unclear value of the products provided. In order to appease to the experiential target segment these are crucial efforts that need to be made in order to re-position the company in the most beneficial way.

Conclusions and Implications of the Situational Analysis

Upper management needs to be aware of the threats within the corporation and thrive on the strengths and future opportunities. Red Lobsters domination in the market has led to the success thus far but some marketing improvements will benefit the company as a whole. Thus far the marketing techniques have improved guests satisfaction by 14%, but with new data established it may be time to change the marketing efforts to accommodate the new information.

Problem Definition

I have determined two main problems within the company 1). The company has been unsuccessful at re-positioning in the most beneficial way 2). Excessive use of promotional menu items. With the 2008 research data established it is clear to see that the company needs to make improvements to their marketing efforts in order to target all of the key markets. Not targeting the key markets has led to a declining or plateauing effect on revenues throughout all locations. Secondly, the excessive use of promotional menu have decrease the overall server attention as well as the reputation of poor food quality. I believe that it would be in the best interest of the company to establish alternative marketing solutions.

Changes Required and Alternative Marketing Solutions

Unable to re-position the company is an issue that could cause a decline in revenue today and the years following. The causes of not re-positioning the company in the most beneficial way is loss of focus on the specific target market and an unclear value proposition. Experiential’s consist of 23% of the dining guests and on average an experiential will spend approximately $24.88 per meal. Experiential’s average spending per meal is higher than any other segment in the market. One alternative to this situation would be to redesigned the advertised ads and redistribute these ads to the correct platform to target this market. This would attract the right audience which will draw in more guests into the restaurant. Second alternative solution would be to conduct a more thorough research and establish an exact execution to solve the issue. Conducting more research will allow for more thorough information this will give the company a better insight to the target market so that the ads could be created accordingly. Third alternative solution would be to create an innovative menu that appeals to the experiential target market. The innovative menu could be motivated by culinary expertise, variety of seafood items, new alcoholic drink list, etc. The new menu would intrigue experiential customer base.

The amount of promotional deals advertise may make the company look cheap and ultimately not “fresh.” Other alternatives to this problem would be to completely eliminate promotional deal, such as the “Lobsterfest” and “Endless Shrimp.” While this attracts in the frugal guests these promotions do no appeal to the higher spenders like experiential and indulgent diners. Secondly, another alternative would be to keep one of the favorite promotional offers and get rid of the second promotional offer. This would reduce the amount of promotional but still attract some of the other frugal guests during the promotional times.

Recommendations and Decision

Ultimately I believe the best decision would be to re-organize the menu to appeal to the experientials and cut all promotions. Re-organizing the menu and cutting promotions will establish the company’s perception and ultimately re-position the company appropriately. The company will be looked at as having culinary expertise, fresh ingredients, and overall great