Red Robin is Making a Major Comeback as Sales Surge

Things are looking up for fast-casual chain Red Robin, after positive Q4 results showed a 3.4% growth for the company which was in serious decline last year. The new projections pushed up the value of Red Robin shares, and indicates the burger company has a real chance of recovery.

"We've been working really hard to fix every piece of the business," chief executive officer G.J. Hart said at the ICR Conference in Orlando, Florida, via Nation's Restaurant News. "These turnarounds don't happen overnight – they take a period of time. I've said many times what I think that takes, and we're fast approaching that."

Hart's focus on his five-point "North Star" plan is clearly paying off, with a menu overhaul, better staffing, and a loyalty program that's bringing customers in again and again. "The loyalty program also allows us to personalize our offers, which we couldn't do before, which will then drive frequency and also drive discounts down because we will give them surprise and delight offers, but we don't have to wholesale across-the-board discount as much," Hart said.

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Hart also emphasizes Red Robin already offers tremendous value for money with its bottomless fried and sides policy: "Bottomless is our promise and commitment to you, that at Red Robin you'll find more than a great meal that also happens to be a great value, here you'll find people and a place that always puts what you care about first," the company says.

"We own Bottomless (sides) and have had it for 50-some years and we don't need to react in this environment," Hart said. "If you look at our results and our sequential improvement, that would suggest (other casual dining chains) are not stealing share from us. We're gaining share."

Red Robin's new managing partner program means the chain is transforming into an "operations-focused" company. "It's taken a lot of education to take a restaurant operator and turn them into a businessperson, but a lot of people in our system are used to a program like that," Hart said. "The number of calls from them worrying about the (profit and loss statement) and specific line items has gone through the roof and we're seeing results. They're very motivated. Not only are we ingratiating into the community, it's doing what we need it to do to show all the progress we've made – that it's a new day at Red Robin."

Red Robin also invested in a marketing bootcamp for operators across the nation, something Hart says is paying off. "It's been really successful for us. It's driving momentum," he said. "When you're doing a turnaround, once you gain momentum, you continue to gain momentum and I think we're headed in that direction. We feel good about it."