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Red Robin: Casual Dining Industry Analysis I. the Industry, The

Red Robin: Casual Dining Industry Analysis I. the Industry, The

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Published by: j0thom19 on Nov 11, 2009
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Red Robin: Casual Dining Industry AnalysisI.
 
The Industry, The Market and The Buyer
Competition AnalysisTotal market share 37.41%
Top CompetitorsCasual dining restaurants represent 16.1% of the rest
aurant industry’s market share (Refer 
to Chart #1).
Based on total system wide sales, Applebee’s
Neighborhood Grill & Bar (operated
 by Dine Equity Inc.) leads the segment ($4.5 billion in 2007), followed by Chili’s Grill & Bar 
(operated by Brinker International; $3.9 billion in the fiscal ended June 2008) (Standard &
Poor’s, 2009). According to Busin
ess Source Premier, the following companies are the topcompetitors of Red Robin Gourmet Burgers Inc:
Applebee’s International, Inc.
with 14.69% of market share, The Cheesecake Factory Incorporated with 3.68% of market share, CaliforniaPizza Kitchen, Inc. with 1.74% of market share, and Ruby Tuesday, Inc with 5.84% of marketshare (May 2008). However, according to Hoovers Company Records
, Red Robin’s top
competitors are:
Brinker International (Chili’s with 11.46% market share), California Pizza
Kitchen Inc
. (1.74%), and Ruby Tuesday (5.84%) (2008). Red Robin’s market share is given as
2.80% in Table Base (June 2006) (See Chart #2).BrinkerBrinker International is among the
best quality casual dining restaurants
in the world.Brinker has
founded its strategies on the strong position of its world-class brands in order to beable to increase the sales of its restaurants and diversify its operations into new markets.
Inaddition, Brinker implements market strategies in which they offer great value products in orderto lure customers to their restaurants. Brinker also uses a number of strategies to continue itssteady growth such as franchising, joint venture, and company-owned development
 
Red Robin: Casual Dining Industry Analysis(Datamonitor, 2008). In developing franchise agreements, Brinker International has been able toemerge into new markets and expand in existing ones.California Pizza KitchenCalifornia Pizza Kitchen has a broad product portfolio providing customers with a widerange of good quality choices. The menu offers different kinds of pizza and salads for differenttastes. California Pizza Kitchen holds a
strong top line growth driven by domestic andinternational franchise agreements
(Datamonitor, 2008).Ruby TuesdayRuby Tuesday tries to appeal to consumers with a
broad selection of menu items and mid-range prices. Ruby Tuesday relies heavily on television and print advertising to promote its brandand distinguish itself from other chains such as Applebee's.
The company
continues to addpremium items to its menu as part of on-going effort to update the Ruby Tuesday brand
 (Hoovers, 2008).
Applebee’s
 
Applebee’s has been undergoing a “
radical change in their business model under theownership of DineEquity
.”
The chain has also been
increasing its marketing and menudevelopment efforts to attract the attention of the dining
 public”
(Hoovers, 2008).
“Applebee’s
strategy is to create a brand image that positions the restaurant chain as a place for family, friendsand coworkers to reconnect and to differentiate the chain from the myriad of other casual dining
chains available to consumers” (Gunelius, 2007).
 The Cheesecake FactoryThe Cheesecake Factory is one of the
largest growing menu categories in the US
restaurant industry.”
They open restaurants in attractive locations, populated areas and above-
 
Red Robin: Casual Dining Industry Analysisaverage income households, for example shopping malls (Datamonitor, 2008). The Cheesecake
Factory doesn’t advert
ise in the traditional sense, they rely heavily on marketing and public
relations efforts. “We create experience,
word-of-
mouth, and a great location with easy access.”
Howard Gordon, Senior Vice-
 president of Business Development and Marketing stands firm, “If there’s not good service, they don’t come back. I do not care how many ads you run” (Price,
2004).
Driving Forces
TechnologyTechnology is the newest and most important driving force in the family/casual dining
industry as “more and more operators move to online ordering and email and text basedmarketing” (Slawsky, 2009). As of late, many casual dining operato
rs have implementedprograms allowing users to place an order online for pick up or delivery, including taking onlinepayments. Some of these programs even provide incentive to placing an order online. Bymerging towards email and text based marketing, operators are getting their customers involvedthrough online savings coupons, e-clubs, and loyalty rewards programs. One major implicationof the use of technology in the casual/ family dining industry is that companies can better track the usage and preferences of their customers, providing invaluable data that will further bolsterthe marketing and distribution efforts of these companies.ConvenienceConvenience in the casual dining industry is imperative to the success of the industry as awhole. Without the given convenience in the act of dining at a casual dining restaurant, therewould be no point in eating out at a casual dining restaurant at all. In order to provide somesemblance of how important convenience is to the consumer, many restaurants have been

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