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Olive Garden, the ubiquitous chain known for its never-ending breadsticks and family-friendly atmosphere, isn’t exactly considered fast food. But in a landscape where traditional fast food giants are facing pressure to adapt, could Olive Garden and its ilk represent a new direction for the industry? That’s where CEO of Darden Restaurants, Rick Cardenas thinks we’re heading with sit-down restaurants.
Cardenas spoke at length during an earnings call yesterday about how consumers are moving away from fast food and opting instead for the sit-down restaurant like Olive Garden or Applebee’s.
He said: “The consumer is really focused on what price they’re paying (everywhere), not just in restaurants. But at the same time, our guests aren’t managing their check like we’ve seen in prior quarters.”
With increasing collective shouts of anger towards the fast food industry and their ever-increasing prices, 78% of Americans are saying fast food has become a luxury. People are pointing out that they can have better quality and bigger portions at local mom and pop’s or the major sit-down chains…so what’s in it for them at Taco Bell or McDonald’s?
As Olive Garden posted slower sales and growth, Cardenas said they plan to combat the issue by enacting more value options. A move already being employed by various chains across the country, including, Applebee’s McDonald’s and Burger King’s $5 Value Deals.
Cardenas continued: “Consumers are really gravitating to our value proposition, where the traditional full-service dining model has been struggling to deliver that value proposition to a modern consumer. As prices have increased at a faster pace in traditional fast food, it’s improved the relative value proposition of our helpful Mediterranean cuisine.”
Olive Garden with their Italian-American fare, while not necessarily authentic, provides a familiar taste with a wider variety than a typical fast-food joint.
While Olive Garden isn’t fast food in the traditional sense, it does cater to a desire for convenience. Their menu is extensive but streamlined, and their service model is designed to be efficient. You can usually get in and out within a reasonable amount of time, making it a good option for a weeknight dinner or a casual weekend outing.
As the fast-food industry is constantly evolving and customer preferences change, chains are rethinking their approach. This could mean a move towards a more casual dining experience, more value options, and a more expansive menu.
Olive Garden may not be the fast food of the future, but it does represent a trend within the industry. Diners are looking for a middle ground – a place that offers more than a burger but less than a white tablecloth. Whether this translates into a complete overhaul of the fast-food landscape or simply a new niche for chains like Olive Garden remains to be seen.
