Red Lobster Case Study Essay

In the first years, reddish Lobsters positioning is low-priced fresh sea nutrition. This positioning last from its start till about 2004. In 2004 after Kim Lopdrup took over as president, he was shocked that consumers put Red Lobster as low end places that serving mass-produced, frozen seafood. So he launched a three phased plan to reposition Red Lobster. form 1 involved basic operational improvement. Phase 2 is repositioning almost freshness. Customers had vague understanding of freshness and they thought Red Lobsters product not fresh mostly because too much deep-fried items on the menu. This phase played the most eventful role in Lopdrups plan (initiated in 2004), and de-emphasizing each(prenominal) fried items and introducing forest-fire grilling atomic number 18 most effective elements. In these ways, Consumer Needs were satisfied and Company Skills were improved. Phase 3 is re-modeling the restaurants, the target of which is becoming nicer than ordinary casual dining p lainly still approachable. This phase started in 2008, and was supposed to red sensation all restaurants by 2014. As a results, customer perceptions that Red Lobster has food that is fresh had increased significantly according to surveys in 2008. By 2010, internal research found that client satisfaction was up 14% to 78% excellent.Everything seemed good at that point. There are something worth notice the new(a) 2008 ads (as current ads in question 2) followed the same model of 2004 ones, but focus shift from woodwind fire grilling and fresh fish to new grilling system and freshness. That means they were introducing new category of cooking method and food that not constrained as seafood, a shift in product. Its extension of introducing wood fire grilling to reposition. In 2008, Copernicus Company guide a study to uncover some psychographic segments, and summarized Red Lobsters customers into 5 categories Experientials, Indulgents, traditionalists, Eclectics and Frugals. Lopdrup was facing a balance between building stronger connection with Experientials and losing image of Indulgent and Frugals.According to form above, the revenues gained from new Experientials are as double as the combination of loss from Indulgents and Frugals. Besides that, Experientials consume much to a largeer extent alcohol, which is more pro pass awayable than food. Former calculation showed an optimistic result to us, so Lopdrup should make Experientials the target segment. He also should modify Red Lobsters positioning accordingly, but do it gradually lest go chapter 11 in the process as K-Mart. The scale of modifying can be described by the answer ofquestions at the end of the case (questions omitted here) SegmentationAccording to the cause paragraph, experientials should represent the new Red Lobster target customer. PositioningRed Lobster destiny to change positioning but not too much. The rise of aquaculture had guide to dramatic declines in the cost of seafood, so appro achable seafood is not as appealing as before. Red Lobster need to find a new positioning, part keeping fresh (according to Exhibit 6A, freshness is the most important factor when customers select seafood). Exhibit 6A also showed that customers think cleanliness, quality and test/preparation are very important, so tasty fresh seafood and beat out fresh seafood are all good options. PromotionCurrent ads fit the positioning the marketing team wanted, as the focus was freshness. Traditional price promotions should be scaled back, shown in Exhibit 6A price is one of the least concerned factor. PriceSimply raising prices is not a good idea for Red Lobster. Although Experientials are important, Indulgents and Frugals are large in customer percentage. Using price discrimination can be a good strategy keep some cheap items in the menu, while introducing more expensive items (including desserts, appetizers and wine). In this way, most patrons can be kept while revenue would raise. Produc tAdding better wine selection is a good idea, since experientials could be attracted in this way while other customers put up other options. Broadening the menu further beyond seafood to steal piece from other premium casual chains is also feasible, the success of wood fire grilling verifies that. Similarly, emphasizing on wine in menu, qualification some location vary its ambience by time of twenty-four hours are all good idea for the same reason as illustrated before. PlaceTo target experientials, re-modeling is necessary. From Exhibit 13, we can know that re-modeling won great appreciation. Most customers would enjoy better atmosphere. Moreover, re-modeling were operated after hours, sobusiness wont be disturbed. The most important reason is experientials are make by Culinary Expertise, sophisticated, upscale atmosphere (shown in Table A, p8 of case). To conclude, all the strategies are to attract experientials without losing other customers.