The chain’s value ratings also climbed to record levels, he said, as Olive Garden continued to stress that everyday value message over a fleeting one. Offers such as Lunch Duos, Early Dinner Duos, and Cucina Mia!
Olive Garden is in the second year of its Early Dinner Duos and didn’t really advertise it heavy out of the gate. So it’s matured. The flexibility of its Lunch Duo section has allowed Olive Garden to keep offerings fresh and pulse new news into an everyday platform. And it gives the company price certainty at lunch, which is a key driver of repeat business at what’s typically a challenged daypart for sit-downs. Guests know what to expect price wise, while Olive Garden has kept the platform appealing through continual innovation. Cucina Mia!, meanwhile, is approaching 10 percent of sales. The create-your-own, 4-year-old program continues to report strong preference, Lee said.
Lee added Olive Garden’s is seeing a very strong customer right now overall—one who is upgrading in the promotional constructs the chain created. Also, given the fact that most of the added mix is coming from entrées, not the add-on sales side, Olive Garden was able to continue improving throughput. The mix hasn’t extended the meal period or complicated execution.
All these layers result in a very strong value proposition for Olive Garden few chains can rival. And it works for the core consumer on multiple fronts—price, abundance, and Olive Garden's brand promise.
“The consumer continues to utilize the full menu in Olive Garden and has surprisingly, in some ways, bought up into the promotions, and it's really been a confluence of a lot of small individual things coming together that has drove the mix,” Lee said.
Lee admitted Q3's mix, with check driving results, is not necessarily sustainable long-term or how Olive Garden sees the big picture.
The brand’s overarching strategy has long been to use scale to underprice competition over the long haul, and to devise productivity enhancements on the operations side to offset inflation.
So with the incentives cutback, could there be an opportunity for Olive Garden to take further traffic share given how many brands are reacting to the inflationary pressures we’re seeing, like labor? Which is to say restaurants are raising prices to guard margins. The traffic versus margin trade-off conversation, in other terms. Or will Olive Garden raise the pricing umbrella as well?