GREENWOOD VILLAGE Colo. —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
The casual-dining chain of more than 400 restaurants spent $1.3 million to buy three weeks’ worth of advertising time on cable for its new 15-second spots featuring the brand’s Steak Sliders, which had been a popular limited-time offer last year. —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
In a Feb. 19 conference call, after domestic company-owned same-store sales fell 7.4 percent in the fourth quarter of 2008, Red Robin officials announced that they would yank national TV commercials. However, they maintain that this new campaign does not represent a reversal in strategy. Rather, they say, it is part of a plan to focus the majority of their marketing efforts on driving traffic through product news rather than just building awareness. —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
“The decision was driven by the fact that bringing back Steak Sliders was big news,” said chief marketing officer Susan Lintonsmith. “We knew that in February and March of 2008, a lot of guests loved the product. They’d been writing us asking when we’d bring them back. This really became a great opportunity to resume national TV advertising.” —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
Red Robin’s original move away from national commercials came at a time when many operators were flocking to the air-waves as they sought to take advantage of lower advertising costs. Panera Bread and Culver’s both launched their first national advertisements in 2009, for example. Lintonsmith said the commercial blackout was not merely a cost-cutting move, but a shift in priorities, as the ad budget was reallocated to local-store marketing like direct mail and e-mail offers. —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
In 2008, Red Robin ran 23 weeks of cable-TV commercials in which guests were given a tour of the chain’s fictional “Department of Deliciousness.” The ads were meant to increase branding and awareness, Lintonsmith said. Manhattan Beach, Calif.-based agency G&M Plumbing did the creative for that campaign, which ran until early November 2008. —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
But the ads didn’t draw crowds. For the chain’s Dec. 28-ended fourth quarter, guest counts at domestic corporate restaurants fell 9.6 percent. When Red Robin officials said during the conference call that they would halt national television advertising, they also announced they would reduce franchisees’ required marketing spending from 1.5 percent of sales to 0.25 percent. —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
While Red Robin planned to spur incremental traffic with local-store marketing materials around product news, Lintonsmith said, the reintroduction of Steak Sliders gave the brand a chance to break another campaign. But during a conference call last month with financial analysts, Red Robin chief executive Dennis Mullen said the brand still has not committed to more TV commercials in the second half of 2009. —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
Analysts, however, praised the Steak Slider spots. —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
“We welcome RRGB’s decision to run three weeks of national TV advertising in June focused on the concept’s popular Steak Sliders,” Jeff Farmer of Jeffries & Company said in a research note. “We’re fans of RRGB’s strategic flexibility and decision to advertise product rather than simply brand. We think RRGB needs to fight fire with fire and that relatively inexpensive marketing bursts represent an effective strategy.” —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
Joseph T. Buckley, an analyst with Merrill Lynch, agreed that Red Robin made the right call. —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
“Red Robin is an interesting and perplexing company,” Buckley said in a research note. “New-unit performance has improved and supports the potential to grow this 428-unit restaurant chain.” —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
He added, however, that his firm was wary of Red Robin’s decision to scale back advertising, especially in a recession, a move that seemed intended only to improve the company’s earnings per share. —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
Yet the chain maintains that its intention to shift advertising focus shouldn’t have surprised any industry observers. —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
“We had been telling the analyst community what our plans were for advertising in 2008,” said Kevin Caulfield, director of corporate communications. “So the plan was to run national spots through X number of quarters. It wasn’t an abrupt halting. It had been planned.” —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
Lintonsmith confirmed that the plan from the beginning of 2008 had been to run 23 weeks of national commercials. After that ran its course, the plan was to go more targeted in 2009, with the option later to return. —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
Red Robin judged the branding spots to be effective in creating awareness, she added, and switching to product-focused ads was the logical next step. —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
“We did feel that we got a benefit from the television ads,” Lintonsmith told analysts in the most recent conference call, “especially in our newer markets. We did see our unaided and aided awareness increase significantly in those markets.… But as we mentioned in past calls, we believe that our strategy of focusing on product news—and that is what we’re doing with Steak Sliders—is the way to drive traffic for us.” —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
Dan Dahlen, executive vice president of restaurants for Nielsen IAG, confirms that Red Robin’s branding spots scored high in terms of recall and likeability, but he supports the brand’s view that product news and branding must complement one another in marketing strategy. —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
“There’s got to be the right balance,” Dahlen said. “Branding is critical to the success of a TV commercial, because viewers have to know who’s sponsoring the new, special value. You only have a piece of the puzzle without it. But if you just run branding content, that’s not going to drive purchase intent.” —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
Dahlen’s first impression of the brand’s strategy was that it was calculated, not driven solely to cut costs or please shareholders. —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
“My initial read was it was more of a strategic move,” Dahlen said. “If it’s cost-saving, that’s writing the script for you getting killed in the end. You can’t save your way to success, especially on TV. It’s integral to survival and success.”— [email protected] —Red Robin Gourmet Burgers returned to national television advertising this month after an eight-month hiatus, hoping to flip the script on several quarters of negative same-store sales by trumpeting product news.
