MARYVILLE Tenn. After two years and $100 million worth of rebranding efforts, Ruby Tuesday has an upgraded, modern look and a menu with more than 27 new premium items. But just because the 896-unit casual-dining chain is targeting a more upscale demographic doesn’t mean it’s trying to be more exclusive.
On the contrary, said Andy Scoggins, vice president of culinary and beverage, the point of Ruby Tuesday’s new menu, launched last week, is to grow profitability through increased traffic, not just menu price hikes.
“We’ve already had the shift in our target demographic,” Scoggins said. “We knew the changes would get us into a little higher-income groups, about $50,000 to $75,000 a year. We’ve come through that shift, and we’re hitting on that demographic now.”
Focusing on a more upscale clientele hasn’t prevented Ruby Tuesday from also developing value-focused promotions, however.
One upgrade meant to combine value and premium quality is the chain’s new $5 cocktail program, offering not only Ruby Tuesday’s 17 signature drinks but also any of its premium well liquors — including Bacardi and Beefeater — for that ubiquitous price point.
“We think it’s industry-changing and revolutionary,” Scoggins said, “and that really will help us create more energy in our restaurants. It gives guests more incentives to come into our restaurants. It shows what we’re willing to do to take great care of our guests.”
Ruby Tuesday officials think the offer is compelling enough to drive the traffic necessary to maintain profit margins.
“As we ran the numbers, we felt we could drive enough traffic and incentive to buy,” Scoggins said. “It’s about driving people from a soft drink to a draft beer or a $5 premium cocktail. If we can get enough trade-up, we won’t take it on the chin. The incentive for us is to sell more people a great cocktail, not fewer people more expensive cocktails.”
The reasoning behind the $5 cocktail program carries over to the rest of the menu. The principle aim, Scoggins explained, is to balance affordable favorites with enticing, premium newcomers like Lobster Carbonara in order to spur enough traffic to maintain profitability.
Because Ruby Tuesday is playing to a more upscale clientele, the company expects the average check to inch up a few dollars from the current level of $11.50. But it won’t be due solely to menu price increases or at the expense of volume, Scoggins said.
“We’re constantly evaluating prices,” he said, “but we’d like to raise our menu mix. We want more sales of our higher-quality items. We still want to offer a great $6 or $7 burger, but there’s going to be more variety at dinner.”
Ruby Tuesday also doesn’t plan to cede any territory in the value game to rivals who have succeeded with such discounts as three-courses-for-$20. The chain will continue its own buy-one-get-one offers while also hoping to entice guests with the new items.
“Another key thing to note is that we haven’t reduced portions or sizes of any kind,” Scoggins said. “We want to give guests full value.”
The point of many new menu items, like the Asian Salmon Spinach Salad or New Orleans Seafood, is to separate Ruby Tuesday from the “cluttered” bar-and-grill segment of casual dining, Scoggins said.
“Seafood plays an important part, and we’ve been able to execute that for some time at a high level,” Scoggins said. “It gives us the ability to stretch our brand in the direction out of bar and grill and into high-quality casual dining. We don’t want to be seafood-specific, but adding lobster and lobster tails gives us a more high-quality feel, as you can’t find lobster in most casual-dining restaurants.”
The lobster tail item, for example, sells for between $16 and $19, depending on the market.
“From a trend standpoint, seafood was emerging in Ruby Tuesday,” Scoggins said. “Every time we ran a seafood promo, it did extremely well. So, fishing where the fish are, it led us to more and more seafood.”
The added variety in the form of lobster tails and lobster pastas, crab cake dinners, and multiple tilapia items potentially could hook guests of Red Lobster or other seafood restaurants because Ruby Tuesday wouldn’t be susceptible to the veto vote, he added.
With the new menu in place, Ruby Tuesday now is focused on taking care of its core business and paying down its debt obligations, he noted. The company was not ready to discuss expansion plans or the possibility of new concept prototypes.
Contact Mark Brandau at [email protected]