As new ads are launched promising that Red Lobster will “Go Overboard” to deliver a great dining experience, the Orlando, FL-based chain is working diligently on several fronts to make the casual seafood dinnerhouses more upscale. That means restaurants in some markets are being refreshed with total redesigns, while in the kitchen, fresh fish entrees with creative preparations are being added to the menu.
In terms of beverage, however, this will be the year of wine. The 650-unit chain is testing two different wine lists (one with 12 wines, the other 17) which feature varietal wines produced by well-known companies. The aim is to replace the generic selections offered in the past, and so far, t est results have been promising, say chain execs.
“We’re finding that beverage alcohol sales are higher, table turnover has remained essentially the same, wine sales have not cannibalized other beverage sales and overall experience ratings have increased,” reports John Altomare, who was brought on board as senior vice president of operations and menu development in mid-2000, in part to direct the company’s wine initiative.
The wine revolution follows other beverage-related efforts led by Red Lobster President Dick Rivera. First was the addition of dedicated Margarita machines, installed because Red Lobster customers ordered many Margaritas, yet gave the beverage low marks consistently on consumer tests. The chain also added more choices at the bar, and eschewed its own “Red Claw” beer in favor of major brands.
In redesigned and new stores, the chain has added open, lively bars to the front of the restaurant. “In the past our bars were little more than service bars that facilitated the ability to serve alcohol, but didn’t add to the ambiance and energy that a bar can create within a casual dinnerhouse,” says Altomare. “As we’ve added the prominent bars, often into areas that used to be dark hallways, we have seen a significant increase in our beverage sales, and we are really gaining credibility as a great place to come and have a drink. That hadn’t been in the front of mind for folks.” With tables on platforms and raised bar four-tops, few restaurants lost seats when bars were added, and some even gained.
With wine, food, bars and margaritas, Red Lobster has reported its 11th consecutive quarter (ended August 27, 2000) of same-store sales growth, continuing to outpace the casual dining industry at large with a 6.2% increase.
And that, says Altomare, is a result of the company’s taking steps toward its ultimate goal: “For us to be a significant top-tier casual dining restaurant.”
WINNING ALL THE WAY
The wines Red Lobster has added are mostly familiar chain restaurant names: Korbel, Sutter Home, Beringer, Robert Mondavi, Fetzer and Kendall-Jackson. Yet more interesting choices include a Franciscan Oakville Estate Cabernet Sauvignon, and a Cambria Chardonnay. Prices range from $3.50 to $6.25 a glass, and $12 to $27 a bottle.
“Since Red Lobster President Dick Rivera joined the company three years ago, he has focused on getting Red Lobster to be a top-tier casual dining house,” Altomare explains. “To do that, we needed a credible wine list, and we’ve put a tremendous effort behind getting one.”
Choosing the wines was the easy part compared to the main challenge: training 42,000 crew members–who’ve been quite comfortable with screw tops–how to sell and serve the beverage succesfully to the seafood chain’s customers.
Before any chain-wide training began, the company tested three training formats in Chicago, Dallas and Atlanta. “We came up with the most successful, which is one that allows us to serve great brand-recognized varietal wines that our guests will be comfortable with, and allows our crew to develop some competency and comfort in being able to deliver those,” Altomare explains.
While he shares no details beyond the training package being “a whole multi-media effort,” including training meetings, video and wine and food pairing tastings, he does give the basics: “Instead of approaching this from a wine snob type of perspective, we approach training by breaking it down into, “Say It, Sell It and Serve It.'”
Taking the fear out of wines has been a daunting effort for the executives, but they’re simplifying the process in many effective ways. For example, wines are listed in order of lighter to fuller-bodied on the wine list, making it easier for servers to help customers choose. “Once you understand that, it’s really all about helping the guests to understand what types of wines they like, and to not be anything but confident in the ability to make those suggestions,” Altomare points out.
To build that kind of confidence, the training program aims to suck the mystique out of wine. One piece of advice often repeated is, “There’s really no wrong wine.”
Training began at the upper level, with senior vice presidents of operations having an educational session. Wines were then a big focus at the general managers’ conference in 2000. All of the company’s wine vendors came together to develop an executive sampling session known as “Wine Valley,” and a variety of exercises, many of them fun such as a spoof of “Who Wants to Be a Millionaire,” added educational opportunities. General managers tasted wines paired with foods at meals so they could understand how wine can enhance a meal, and a raffle of signed corkscrews gave away prizes such as a trip to the Napa Valley wine region.
Overall, the higher-ups on the operations end are buying into the wine program big time. The chain initially tested 12- and 17-bottle lists, and let each division choose which list to offer. “Most of them have gone with the 17-bottle list,” Altomare reports. “We were surprised at first because it didn’t seem natural for them to want the full 17, but, as we started to really train them, and started to introduce everybody to the wines, the interest started to gain momentum–at all levels.”
At press time, directors of operations were being trained in wine knowledge and wine training. The plan is for them to then train managers and crew members in their areas over the next few months, resulting in a gradual roll-out of the wine menu as each crew becomes comfortable with it.
Part of staff training is learning how to uncork wine bottles. “Once someone has taught you how to do it and you’ve had the chance to practice, you find out it’s not that difficult,” Altomare explains. Crew members have practiced on corked empty wine bottles to build a comfort level. No special corkscrew is being used. In fact, no extra equipment has been added to Red Lobster restaurants for the wine service. “We’ve had the ability to do wine,” Altomare points out.
Emphasis is being placed on making sure the wine is served at the proper temperature, and that guests are receiving the wines they order. For the servers, the benefit of becoming wine-knowledgeable is clear: More wine sales mean larger check averages, and larger tips.
Customers, too, won’t need much to learn much, according to surveys: Data shows that Red Lobster consumers are already wine drinkers. They just haven’t been ordering the beverage at Red Lobster because the choices didn’t appeal to them. Some passed the category by altogether, while others chose items such as Sutter Home Zinfandel; in fact, Red Lobster was for many years the largest on-premise account for that wine. “So it wasn’t that we didn’t have people drinking wine in our restaurants,” says Altomare, “but that we weren’t as relevant, especially as we started moving forward with the rest of our beverage programs [such as improving and merchandising Margaritas].”
Research, in fact, has shown that Red Lobster guests know wine better than the average casual dining guest, indicating that wine sales are an untapped market. Baby boomers are driving the casual dining segment right now, and they comprise the consumer group most likely to order wines. And, seafood is the most popular food choice in casual dining restaurants. “What we’ve found is that we’re in the right spot, seafood is a great niche to be in within casual dining,” says Altomare.
Red Lobster plans to market the wine lists in several ways, but none of them aggressive. A colorful photograph will likely appear in the book-style beverage menu prominently placed on each table, along with the wine list. In one test market, a “fresh fish sheet” lists daily specials with recommended paired wines. Altomare is also testing mentioning wines by name when they’re used to prepare entrees. Shrimp scampi has been made with wine for years, for example, but now test menus offer “shrimp scampi made with Kendall Jackson Chardonnay.” “We’re romancing the food,” he explains. Test units also have bottles of wine with plastic grapes placed attractively in wooden displays against the walls.
“Since Red Lobster President Dick Rivera joined the company three years ago, he has focused on getting Red Lobster to be a top-tier casual dining house. To do that, we needed a credible wine list, and we’ve put a tremendous effort behind getting one.”John Altomare
Senior vice president of operations and menu development
While Altomare won’t admit to getting favorable prices on wines because of the quantity the chain will be buying, he does admit to receiving many other benefits from being a primo customer. “What we do get is tremendous support from our wine vendors,” he says, “around training and educating our managers and our crew about wine. They’ve really partnered with us in that regard.”
The wines keep up with an evolving menu. While Red Lobster stills sell an awful lot of what Altomare calls “very craveable” items such as fried shrimp, lobster and crab, he’s counting on “fresh fish done with specialty preparations” to become more craveable. These might be grilled mahi-mahi with citrus butter, Baja Crunch Tilapia (encrusted with tortilla breading and Southwestern seasoning and topped with pico de gallo, served with cilantro dipping sauce), and teriyaki-glazed fish with island salsa. To cut down on veto factor no-shows, new chicken items are on the rise, including Aztec chicken, grilled with chipotle barbecue seasononing and topped with tequila-lime sauce.