In a separate study, Cuebiq also ran the same footfall traffic analysis across Texas Roadhouse, The Cheesecake Factory, Red Robin, LongHorn Steakhouse, Cracker Barrel, and TGI Fridays.
Here were the findings:
Share of visits:
- Texas Roadhouse: 26.73 percent
- The Cheesecake Factory: 9.29 percent
- Red Robin: 17.91 percent
- LongHorn Steakhouse: 11.69 percent
- Cracker Barrel: 24.21 percent
- TGI Fridays: 10.17 percent
Customer loyalty (guests who don’t eat at the other chains in the list):
- The Cheesecake Factory: 70 percent are loyal
- Red Robin: 70 percent are loyal
- TGI Fridays: 69 percent are loyal
- LongHorn Steakhouse: 64 percent are loyal
- Texas Roadhouse: 69 percent are loyal
- Cracker Barrel: 68 percent are loyal
- Texas Roadhouse: 63 percent of customers between 5-8 p.m.
- Cracker Barrel: 44.87 percent of customers between 11 a.m.-2 p.m.
- LongHorn Steakhouse: 55 percent of customers between 5-8 p.m.
- Red Robin: 45 percent of customers between 5-8 p.m.
- The Cheesecake Factory: 43 percent of customers between 5-8 p.m.
- TGI Fridays: 42 percent of customers between 5-8 p.m.
In this case, it’s Texas Roadhouse that takes the “most frequented chain” title.
Let’s unpack unit count again:
- Texas Roadhouse: 540
- Cracker Barrel: 660
- LongHorn: 506
- Red Robin: 572
- The Cheesecake Factory: 198
- TGI Fridays: 450
Texas Roadhouse is, and has been for some time, one of the most consistent chains in casual dining, from a sales and performance angle. It reported same-store sales gains of 5.7 percent at company-run units and 3.9 percent at domestic franchised stores (70 of the restaurants are U.S. franchises) in the second quarter. Traffic lifted 4.3 percent. On a two-year stack, the 5.7 percent hike built off last year’s 4 percent increase, giving Texas Roadhouse an impressive nearly 10 percent comps story to tell.
Texas Roadhouse also beat its casual competitors in this year’s American Customer Satisfaction Index, scoring 83 out of 100 to lead all full-service brands. Texas Roadhouse supplanted Cracker Barrel after gaining 1 percent over last year’s study. Cracker Barrel dropped 4 percent into a three-way tie for second at 81. Here’s the full list.
Red Robin was the biggest gainer, up an impressive 8 percent to 79.
The picture isn’t entirely rosy for Texas Roadhouse, although it depends really on how you look at it. The chain has fought rising labor costs in recent periods. Restaurant margin fell 76 basis points, year-over-year, to 18.7 percent of sales thanks to higher labor costs, in Q2. Labor as a percentage of total sales upped 93 basis points to 32 percent and labor dollars per store week were up 7.5 percent compared to the prior-year period. The culprits: wage and other inflation of about 4.3 percent, as well as Texas Roadhouse’s decision to increase managing partner base pay and growth in hours of about 3.2 percent.
However, this is an issue Texas Roadhouse understood was coming. The reason being that it looks at “providing a legendary experience,” according to president Scott Colosi, as the key to long-term growth, not cutbacks. And doing so demands a heavy investment in staffing.
“We found that our stores that have over a certain level of servers on the high-end have stronger comps than those that have an amount of servers on the low-end, which have lesser comps,” CEO Kent Taylor once said. “So that basically tells you that when you’re properly staffed life looks a little better.”
Red Robin and Cracker Barrel are both facing traffic issues lately. Red Robin this past quarter saw its same-store sales drop 2.6 percent and guest counts decline 0.7 percent.
CEO Denny Marie Post said many of the issues were self-inflicted. Mainly, the fact that 75 percent of its loss in dine-in traffic came from peak hours. “What’s really startling is our walkaways increased, what 850 basis points, or up about 85 percent, year-over-year,” Post said. “… In this day and age we just can't afford to have any guests walk back out of the building.”
Red Robin’s total ticket times out of the kitchen increased about a minute on average. The burger chain credited growing complexity in the business, thanks in large part to off-premises and the evolving host role. Red Robin is actively addressing these concerns, Post added, including revamping its Tavern burger lineup to improve per person average by adding new options less frequently and mixing up pricing. “The bottom line is much better service execution with improved promotional balance,” Post said. “We are confident we have identified the key issues that led to the misses and are putting solutions in place to improve through year-end. Now it is up to our entire team, home office, and building to deliver.”
Cracker Barrel, meanwhile, saw its same-store sales declines 0.4 percent in the fourth quarter, year-over-year, with average check up 3.1 percent. But a guest traffic drop of 3.5 percent spoke to a larger worry for the 660-unit brand. For the fiscal 2018 calendar, traffic fell 1.9 percent (comps increased 0.6 percent). "I'm concerned with our traffic trends, and over the past few months, our team has been rigorously analyzing the underlying factors of our underperformance," CEO Sandy Cochran said during a September 18 conference call.
Here’s how the traffic has trended:
- Q4 2018: –3.5 percent
- Q3 2018: –1.3 percent
- Q2 2018: –0.9 percent
- Q1 2018: –1.8 percent
- Q4 2017: –1.8 percent
- Q3 2017: –2.1 percent
- Q2 2017: –2.1 percent
- Q1 2017: –1.7 percent
Underperformance of its Campfire Menu and a faltering value positioning aided the swing. Like Red Robin, Cochran said Cracker Barrel was proactively fixing the issues.
“We've been reevaluating the touch points we have with our guests in order to execute more consistently, particularly at dinner, which has been the most challenged of our dayparts,” she said. Read more about Cracker Barrel’s efforts to turnaround sales and traffic here.