Ruth’s Chris Steak House woos customers like a spritely new concept, belying its 50 years in business. The 142-unit restaurant chain ranked first among Fine-Dining concepts in this year’s Consumer Picks survey and has led the segment for three consecutive years.
Mike O’Donnell, president and CEO of Winter Park, Fla.-based Ruth’s Hospitality Group Inc., said the success with consumers is built on a number of things, not just sizzling, butter-brushed prime steaks.
“We say we don’t sell steaks; we say we serve memories on 500-degree sizzling plates,” O’Donnell said.
Those memories also rely on a company culture that embraces selective hiring, retention of well-trained staff and a continued commitment to recertifying staff members at all levels, O’Donnell said.
“It starts with the people and, at the end of the day, it ends with the people,” he said. “Those are the servers who are making sure our guests are having a good time and cooks who are making sure the steaks are sizzling.”
This year, Ruth’s Chris scored at the top in five of 10 Fine-Dining attribute categories, leading in Food Quality, Service, Menu Variety, Reputation and Craveability. The brand ranked second in Cleanliness behind Morton’s the Steakhouse and for Likely to Recommend, behind Darden Restaurants Inc.’s The Capital Grille.
O’Donnell said franchisees uphold the same standards as the company-owned stores, and many of them were awarded their rights by restaurant founder Ruth Ann Udstad Fertel herself.
“If you go all the way back to Ruth and her philosophy of ‘do what you love and love what you do,’ our franchise community has been [aligned] with that since the very beginning,” O’Donnell said. “The commitment level of those franchisees is the baseline foundation underneath us.” The company owns and operates 65 stores, and the franchisees run 77.
Ruth’s Chris has a rich history that begins with the hard work of Ruth Fertel, who died in 2002 at age 75.
Fertel was born in New Orleans in 1927, the same year restaurateur Chris Matulich opened Chris Steak House in the Crescent City. She graduated from Louisiana State University, studying chemistry and physics, and became a teacher at McNeese State University for two semesters after graduating. She married in 1948, had two sons and divorced ten years later.
Unable to provide for her children on alimony alone, Ruth became a lab technician at Tulane University School of Medicine. In 1965, she saw a newspaper ad that indicated Chris’ Steak House was for sale. She mortgaged her home and bought the restaurant, which was destroyed in a fire in 1976.
She quickly opened a nearby location, but she needed to change the name because the original contract barred her from using the name Chris’ Steak House at a different location. It became Ruth’s Chris Steak House.
“There’s a great heritage that travels with us,” O’Donnell said. “Our focus is on taking care of our people. We believe firmly that if we take care of those people, they will take care of the customers and our business.”
That business has been good. For the fourth quarter ended Dec. 28, Ruth’s saw its 20th consecutive quarter of traffic growth, and same-store sales increased 5 percent compared with the prior-year quarter. Average unit sales at the 65 company-owned restaurants were $112,200 per week in the quarter, up 4.5 percent from the $107,300 per week in the same quarter of 2013.
For the full-year 2014, average unit volumes at company-owned restaurants were $5.2 million and same-store sales increased 3.7 percent.
Such high volume stores require a dedicated and well-trained staff that has room for advancement, O’Donnell said.
“We have a high commitment to training, making sure they have all the education they [need to excel],” he said. “Then we make sure we promote those individuals, whether it’s literally into other jobs and responsibilities or promoting their successes.”
Many staff members have been with the company for 20 or more years, O’Donnell said, and many are recruited through existing employees.
Training has evolved in the last 50 years, O’Donnell said. “We’ve started to use other sorts of technology to train,” he said. “But the one thing we do very well is we hire people with hospitality in their DNA, and we give them a place to flourish.”
The Service ranking in the Consumer Picks survey reflects “a sense of genuineness” on the part of the staff, O’Donnell said.
“People want to come work here because they want to be of service,” O’Donnell said. “Most of our referrals come from current crew.”
That level of service differentiates Ruth’s Chris from other brands, he explained. “A lot of people sell steaks. A lot of people sell prime product. A lot of people have the same opportunities we have,” he said. “It’s clear to me and [to] our folks: We’re here to sell an experience, and that experience has to do with the quality of the food, it has to do with the quality of the service, it has to do with the quality of the atmosphere. That ultimately gets you to making the memories.”
Keeping the menu simple, but high-quality
O’Donnell said Ruth’s Chris makes sure the menu is kept simple but of the highest quality.
“We buy the best beef we can in terms of prime product, and that’s generally in the top two and three percent of beef produced in the United States,” he said. “We’re highly selective in what we are buying, [whether] it’s beef or fish or any of the products.”
O’Donnell said, “We try to keep the menu at a size where we can execute at a superior level. We try not to overcomplicate it: We’re a classic American steakhouse with a touch of whimsy. If we push the food too far to the outside, it will put more demands on the kitchen than we would like.”
Ruth’s Chris’ best-selling menu item, as it has been for years, is the filet mignon.
Two years ago, the company debuted the Sizzle, Swizzle and Swirl happy hour program in the bar to broaden its audience, said Cheryl Henry, chief branding officer and senior vice president at Ruth’s Hospitality.
“We found that consumers were looking for other opportunities and other ways to use Ruth’s,” Henry said, which the happy hour menu offered.
“It’s dedicated to our bar area,” Henry said, “but it allows people a bit more frequency and a completely different menu, one that offers them food opportunities they may not find in the dining room atmosphere and unique, classic cocktails.”
The program enables the brand to update the menu as well, she said. “It’s a great entry point for folks,” she said. “We’re in the market with a new bacon slider on pretzel bread, which is very popular right now.”
Still, steak is clearly its primary draw. The restaurant’s atmosphere has a genuine and exciting New Orleans steakhouse vibe, O’Donnell said, adding that its steaks entice many of the senses on the way to the table. “You can smell it before it gets there,” he said. “You can hear it before it gets there.”
The individual restaurant teams are not relying heavily on new technology, Henry said, but some new technology is being deployed to manage e-mail marketing messages designed to deepen its relationship with guests.
“We do a good deal of consumer insights, asking questions how they use technology,” Henry said, adding that customer insights are important to the business, including keeping track of guests’ special occasions so that it can further customize the experience.
“Generally if you are going to an upscale steakhouse, you are not going there just to eat,” O’Donnell said. “You’re going there to celebrate something. We think we know a lot about celebrating and celebrating special occasions, whether it’s Mother’s Day or Father’s Day or Valentine’s Day.” O’Donnell said it is Ruth’s Chris’ job to make those occasions memorable for its customers.
“When people ask us to help them celebrate, we know we are not the show; we’re the supporting cast,” he said.
Henry said that it’s those special occasions, when executed successfully by the restaurant teams, that generate the most positive word-of-mouth for the brand.
To keep the staff members at the top of their game, O’Donnell said the company has an established recertification program for most levels of employees at both company and franchise restaurants.
“If you can’t broil steaks to certification standards, you don’t work,” he said. “Even those who’ve worked for us for more than 30 years still get certified every month.”
Henry added that event and banquet managers are also recertified every year on best practices and how to make large-group experiences as special as the à la carte experience in the dining room.
“We spend a lot of time training on the enhancement of the experience,” Henry said. “That makes us unique.”
When the steak meets the plate, it’s the service level that distinguishes the Ruth’s Chris brand from other dining
experiences, O’Donnell said.
“It’s a combination of great people committed to doing great things. We’ve created an environment where people can express themselves,” he said.
“For what we charge,” O’Donnell added, “customers come to expect a seamless, flawless, frictionless experience.”
Contact Ron Ruggless at [email protected].
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