By Jonnelle Marte
As Olive Garden and other eateries consider marketing campaigns that focus more on dollar signs and less on bread sticks, some industry experts predict restaurant menus may soon look more like ads for Black Friday.
Restaurants across the price spectrum are feeling more pressure to prove that they offer good value, according to analysts. The pressure is creating a competition of sorts, accelerated by social media and smartphone apps that allow consumers to track down deals while they’re strolling through the mall, says Andrea Woroch, a consumer savings expert. “Consumers have definitely become expectant of deals whether they’re shopping for clothes or dining out,” says Woroch, adding that the growth of online coupons and group-buying sites are making discounts of up to 70% off at restaurants the norm.
That’s forced many businesses to rebuild their marketing techniques to target price-conscious consumers, she says. Darden Restaurants, which owns Olive Garden, says it managed to outperform its competitors during the recession by resisting deep discounts that could hurt the bottom line. But with that advantage fading, the company is thinking about a new approach that focuses more on prices than its menu offerings, the Wall Street Journal reported Tuesday.
For some restaurants, the pressure to add value is leading to discounts offered on a daily deal site or limited time menu items, says Aaron Allen, a global restaurant consultant. But it also means using social media sites like Twitter and Facebook to keep those offerings – and the brand– fresh on consumers’ minds. “Technology and innovations that have come out have influenced the restaurant industry and what we as consumers expect,” says Allen. “Some consumers find that at the restaurant industry we aren’t keep up pace at all.”
But critics point out that sometimes promotion discounts cause more damage than good. For instance, an August promotion at Olive Garden for a never-ending pasta bowl, including unlimited salad and breadstick, for $8.95, failed to drive much traffic, the Journal reported. And often, the deals bring in customers that will only last as long as the deal, says Joel Cohen of RestaurantMarketing.com. “It gets butts in the seats but as soon as they raise those prices those customers go away,” says Allen.