Red Lobster Raises Price Of Endless Shrimp Deal Because Too Many People Are Ordering It
If you've suspected that a popular Red Lobster meal deal recently got a little pricier, you're not mistaken. The seafood chain's parent company just confirmed that it boosted the price after facing more than $11 million in operating losses in the latest quarter.
Back in June, Red Lobster announced that it was bringing back its popular Ultimate Endless Shrimp deal. But while the chain has only offered the deal as a limited-time promotion in past years, Red Lobster said that the deal was here to stay this time around.
"Ultimate Endless Shrimp has been an iconic promotion and a guest-favorite tradition at Red Lobster for more than 18 years," Patty Trevino, chief marketing officer at Red Lobster, said in a statement at the time. "Knowing how much our guests love and look forward to the return of Ultimate Endless Shrimp each year, we decided it's time to make this guest favorite available all day, every day."
For anyone familiar with Olive Garden's Never-Ending Pasta Bowl, the concept behind Ultimate Endless Shrimp is very similar. Customers who opt for the deal can order as much as they can eat, choosing from a selection of various Red Lobster shrimp dishes like the Garlic Shrimp Scampi and Shrimp Linguini Alfredo.
When Red Lobster reintroduced the deal in June, it came with a price tag of just $20. For comparison, one regular order of Shrimp Linguini Alfredo costs $16 at a Red Lobster in New Jersey right now, so customers need only shell out a few extra dollars in order to get endless helpings of shrimp. However, Red Lobster's parent company, Thai Union Group, just revealed that it has decided to raise the price of the deal to $25.
The reason? According to Thai Union CFO Ludovic Regis Henri Garnier, it's because customers ordered it more often than the company anticipated.
As Restaurant Business Magazine reported, Garnier said during an earnings call last week that the idea behind bringing back the deal was attracting more customers to Red Lobster. But while the company did credit the deal for a small boost in guest traffic, Red Lobster's financial performance suffered.
Thai Union initially expected to lose around $17 million in 2023. In light of the Ultimate Endless Shrimp deal's popularity, Thai Union now expects Red Lobster to lose $20 million, Restaurant Business Magazine reported. Red Lobster also reported an operating loss of more than $11 million in the third quarter of the year, which was higher than Thai Union expected. The company's response was the $5 price hike.
"We want to keep it on the menu," Garnier said of the deal. "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 shrimp debacle is only the latest issue Red Lobster has faced in 2023. Earlier this year, the company confirmed that it had closed at least eight restaurants that were "no longer viable" for the chain. The loss of those restaurants followed five Red Lobster closures in the United States in 2021 and another four closures in 2020.
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