Red Lobster revealed Monday its “Ultimate Endless Shrimp” promotion is now “here to stay,” following earlier comments from a major shareholder that the seafood chain needed to create a new menu with more value for customers.
For $20, customers can start with two shrimp dishes and then order more. Options include coconut shrimp, garlic grilled shrimp skewers, garlic shrimp scampi, and other. The meal comes with the customer’s choice of a side as well as Cheddar Bay Biscuits.
Orlando-based Red Lobster recently offered the deal in September, when restaurants were in one of the slowest parts of the year in the weeks after Labor Day, but now the promotion is “available all day, every day,” a news release said.
Red Lobster shareholder Thai Union reported in May it had a “share of profit from operations” for Red Lobster in the first quarter of this year, a turnaround from a loss in the same period last year.
But Thai Union group CFO Ludovic Garnier said on an earnings call there was still a lot of work to be done and Red Lobster needed to make sure it offered good value between big promotions like Ultimate Endless Shrimp because consumers in the United States are sensitive to price.
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“We need to reinvent. We need to be a bit more creative,” Garnier said. “… The team right now is working on how to propose [a] new menu, new meal, very attractive from a value proposition.”
Eating out cost 8.3% more in May than it did a year earlier, with full-service meals up 6.8%, according to measures by the federal government.
San Diego-based restaurant analyst John Gordon said there are risks with moving the promotion to the everyday menu, including that Red Lobster loses the deal as a marketing opportunity.
“It is new news for a while, but after a while, it’s no longer new news,” Gordon said. “What is paramount in the restaurant business is to provide new product, [and] new news.”
While Gordon noted seafood supplier Thai Union’s expertise in sourcing products, he said another risk is Red Lobster could be put in a difficult position with the promotion’s price if there is a spike in shrimp costs.
The positive, Gordon said, is adding the promotion to the menu will attract a certain kind of customer and bring in sales.
But “after a while, the impact of that will wear off,” Gordon said. “I have seen this over my 45 years [in the restaurant industry].”
Thai Union said in its earnings presentation it had no plans to sell Red Lobster in the short term. The seafood supplier, whose brands include Chicken of the Sea, became a Red Lobster stakeholder in 2016 before teaming up with a group of investors in 2020 to acquire the rest of the company from San Francisco’s Golden Gate Capital.
But there have been some public signs of instability at Red Lobster, with CEO Kelli Valade resigning after just eight months on the job in 2022. A new CEO has not yet been announced.
“Ultimate Endless Shrimp” has been around for more than 18 years.
“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,” said Red Lobster chief marketing officer Patty Trevino, in the release. “And this is just the beginning – we’ll be ‘dropping’ more Ultimate Endless Shrimp excitement later this year.”
