Despite attracting a surge of customers, this promotion has cost the company millions.
From Good Morning America:
While the move certainly accomplished getting more hungry customers into restaurants -- 4% year over year -- the company posted an operating loss of over $11 million in its third quarter, with the discounted offer contributing to that loss, according to Red Lobster's Thailand-based parent company, Thai Union Group.
Last month, Thai Union Group reported that Red Lobster had "higher losses from operations than expected" in its third quarter of 2023. On its latest earnings call, the company's CFO Ludovic Regis Henri Garnier said Thai Union Group wasn't aware the initial deal price was so cheap.
"We wanted to boost our traffic, and it didn't work," Garnier told investors, as first reported by Restaurant Business. "We want to keep it on the menu. And of course we need to be much more careful regarding what are the entry points and what is the price point we are offering for this promotion."
The seafood company cited "Ultimate Endless Shrimp" as a key factor in the financial misstep and has since raised the price of the deal to $25 at all 670 restaurants.
All in, Thai Union said it expects a $20 million loss for 2023.
That's not just a slight profit dip; it's colossal.
I'd put my money on this promotion getting the boot ASAP.
