Current:Home > BackRed Lobster's cheap "endless shrimp" offer chewed into its profits-Angel Dreamer Wealth Society D1 Reviews & Insights
Red Lobster's cheap "endless shrimp" offer chewed into its profits
View Date:2024-12-23 22:38:07
When Red Lobster diners tucked into the seafood chain's all-you-can-eat shrimp, they were also biting into something else — the company's profits.
In June, Red Lobster made its popular "Ultimate Endless Shrimp" promotion, which it had long offered on a limited-time basis a permanent fixture on its menu. The goal: to boost foot traffic to its restaurants between July and December, when sales typically slow.
Under the all-you-can-eat offer, diners get two shrimp-based dishes to start, but then can order as many additional shrimp dishes as they want, including favorites like Popcorn Shrimp, Garlic Shrimp Scampi and Shrimp Linguini Alfredo.
Customers ate it up. But while demand for endless shrimp surged, Red Lobster struggled to turn a profit while serving mounds of shellfish at a comparatively bargain-basement price. Boosting the offer price to $22 and even $25 failed to stem the losses, which contributed to a downbeat quarter for Red Lobster's owner, Thailand-based Thai Union.
Lesson learned. "We need to be much more careful regarding… what is the price point we're offering for this promotion," Thai Union Chief Financial Officer Ludovic Garnier said in an earnings call earlier this month.
The popularity of Red Lobster's unlimited shrimp feast coincides with a recent spike in visitors to all-you-can-eat chain restaurants. In March, Golden Corral, Cicis, and Pizza Ranch — three popular buffets offering prix-fixe dining — saw a 125% increase in foot traffic over two years, data from foot-traffic tracker Placer.ai shows.
The growing popularity of all-you-can-eat dining options comes as Americans say they're still feeling the pain of higher consumer prices even as inflation cools.
- In:
- Food & Drink
- Inflation
Elizabeth Napolitano is a freelance reporter at CBS MoneyWatch, where she covers business and technology news. She also writes for CoinDesk. Before joining CBS, she interned at NBC News' BizTech Unit and worked on the Associated Press' web scraping team.
veryGood! (6)
Related
- Tesla issues 6th Cybertruck recall this year, with over 2,400 vehicles affected
- Have you ever been called someone's 'moot'? The social media slang's meaning, unpacked
- Our credit card debt threatens to swamp our savings. Here's how to deal with both
- Christopher Bell wins NASCAR race at Phoenix to give emotional lift to Joe Gibbs Racing
- Why Cynthia Erivo Needed Prosthetic Ears for Wicked
- Cry a River Over Justin Timberlake and Jessica Biel’s Perfect Vanity Fair Oscars Party Date Night
- Da'Vine Joy Randolph's Emotional 2024 Oscars Speech Will Make You Tear Up
- Federal judge in Texas blocks US labor board rule that would make it easier for workers to unionize
- 'SNL' stars jokingly declare support for Trump, Dana Carvey plays Elon Musk
- Report: Workers are living further from employer, more are living 50 miles from the office
Ranking
- Cavaliers' Darius Garland rediscovers joy for basketball under new coach
- Vanessa Hudgens is pregnant, revealing baby bump at Oscars
- Surreal April 2024 total solar eclipse renews debunked flat Earth conspiracy theories
- Christopher Bell wins NASCAR race at Phoenix to give emotional lift to Joe Gibbs Racing
- Golden Bachelorette: Joan Vassos Gets Engaged During Season Finale
- Mac Jones trade details: Patriots, Jaguars strike deal for quarterback
- Why Al Pacino's 2024 Oscars Best Picture Flub Has the Internet Divided
- Did Monica Sementilli conspire with the man she was having an affair with to murder her husband?
Recommendation
-
2 credit unions in Mississippi and Louisiana are planning to merge
-
Matt Damon's Walk of Fame star peed on by dog Messi, picking a side in Jimmy Kimmel feud
-
Inside a U.S. airdrop mission to rush food into Gaza
-
Stock market today: Asian shares mostly lower, Japan’s Nikkei 225 falls 2.5%
-
Roy Haynes, Grammy-winning jazz drummer, dies at 99: Reports
-
NFL free agency QB rankings 2024: The best available from Kirk Cousins to Joe Flacco
-
Which NFL team has the most salary cap space? What to know ahead of NFL free agency
-
Biggest moments from the 2024 Oscars, from Emma Stone's surprise win to naked John Cena