Red Robin Gourmet Burgers is rethinking its full-service restaurant model top to bottom—from name to service style to menu—as it also expands its fast-casual concept, Red Robin Burger Works.
Some "transformed" Red Robin units use this logo.
Red Robin reported its Q3 results today, which include a 3.4% increase in total revenues and a 1.1% increase in same-store sales for company units. More importantly, CEO Stephen Carley said that during this current quarter, the chain has begun experimenting with “a number of transformed restaurants.” This “is not simply a remodeling project but part of our overall strategy to make the Red Robin brand more relevant to our guests and to attract them more often.” What is “transformed” at this undisclosed number of units, Carley said, can be anything from “physical space and layout of the restaurants to team-member uniforms, our service model, our menus and our food preparation.”
The Oktoberfest beer milk shake is emblematic of the brand changes being considered.
Additionally, the company confirmed to BurgerBusiness.com that some of the transformed restaurants will have a new logo and signage, identifying the restaurant as Red Robin Gourmet Burgers + Brews. This logo incorporates the flame motif used with the five Red Robin’s Burger Works that are open.
This name helps Red Robin’s quest to increase its appeal to adults without children and to boost alcoholic-beverage sales (now more than 7% of sales). The chain’s ongoing “Taking Back the Bar” initiative looks to further increase those sales. Red Robin’s recent introduction of the Oktoberfest Beer Milkshake promotion with Sam Adams beer signaled its interest in being more of a “burgers + brews” brand.
The desire for a more-adult image undoubtedly will result in the elimination of the current “Yummm!” advertising slogan when a new agency is named (succeeding incumbent Periscope). That will happen by the end of the year.
Carley said the test restaurants are “laboratories” that will help the company “determine what’s really important to our guests and determine the returns” on its investments in remodeled space, among other elements. A determination of what changes to make at all 471 of its full-service Red Robins will be made by Q3 of 2013, Carley said.
The Tavern Double provides "everyday value" that Red Robin lacked.
As for the five smaller-footprint, fast-casual Burger Works restaurants, Carley noted that they vary not only in size and trade area but also in “performance and consistency of execution. But they provide a lot of learning we can use to tweak the model.” As many as five more Burger Works will open in 2013.
Near term, Red Robin is looking at how best to balance pricing for its menu. The $6.99 Tavern Double burger has been its most successful product launch, giving it an “everyday value” entry point. It also allowed Red Robin to bring back the Oktoberfest LTO burger at full price ($9.99), rather than discount it by $3 as it did last year.
But the tradeoff in Q3 was that while customer traffic was up 0.8%, price/product mix contributed just 0.3% toward the 1.1% same-store sales gain. In 2011’s Q3, comp sales also rose 1.1% but with price/mix contributing 4.3% to offset a -3.2% debit in guest counts. Given the “challenging environment,” Red Robin is happier with increases in both price/mix and guest traffic. “Guest traffic has been hard to come by [for all restaurants] this year, particularly in the last quarter,” said SVP-CMO Denny Post.
Burger King will do more dealing to keep "value" customers.
Carley pointed out a few small measures taken that have brought significant savings. A switch in the appearance specification for chopped onions used in salsa meant a system savings of $120,000. A switch in to-go packaging has netted $275,000 and the adoption of reusable, washable kids beverage cups will save the company $500,000.
◙ Separately, Burger King Worldwide also announced results for its third quarter ended September 30, 2012. These include a systemwide same-store sales gain of 1.4% and a 1.6% increase for the U.S./Canada. That is a lower comp-sales gain than a year ago, which the company attributed to “more challenging prior-year comparisons and the loss of some value based traffic.”
That means, as the company acknowledged, that while its new higher-price menu platforms such as the BBQ sandwiches on the Summer Menu have been successful, Burger King has seen some “value” customers go elsewhere for dollar items. The current restaurant market “is highly competitive where value is a key factor in attracting guests,” said Steve Wiborg, president of BK North America.
About 30% of Burger King’s sales comes through low-price channels, including its Value Menu (9% of sales), coupons (8%) and other deals (such as price reductions, accounting for about 14%) according to Wiborg. Those numbers are roughly comparable to sales at McDonald’s and Wendy’s, he said. Burger King will continue to have limited-time budget promotions, such as $1 smoothies and $1 chicken sandwiches, to keep its value customers happy at the same time it continues to build on its premium-price platforms such as BBQ.
Can't keep track of all the new menu additions? Check the 
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Red Robin’s hamburger patty is smaller now? Their wings are now 2nd class using the cheaper part of the wing. Red Robin fries used to be so perfect. Now it looks like there is no high quality left for the high price.
They walked on quality and I will now walk by without stopping.
Shame on you Red Robin for cheating the customers!
What happened to the all you can eat fries? Increased prices and dropping the all you can eat fries option; not good.
We used to eat at RR once a week, since they dropped the fries option, we haven’t been back.
RR still has bottomless steak fries. They bring extra food for our kids when they eat it all, when asked. Very great service. No problems here, keep up the good work. LOYAL TO RR.
Yes, the patties are smaller. I can’t say that it’s my favorite burger anymore. After 25 years. Such a shame… And doesn’t feel like its targeting the older crowd. It’s just making us angry because we are getting cheated!
Franchised restaurants may be different, but you can still get bottomless fries. They just don’t want to encourage fries before the meal (which is technically not suppose to happen at all). Also, the size of the standard burger has not changed, 6 oz. They are now offering a smaller burger, Tavern Double or petite patties, as an option. I’ve worked for the company for years, and I stand behind them.
Booo! Boo to Red Robin! Our local Red Robin remodeled at 7460 West 52nd Avenue Arvada, CO 80002(303) 431-6450. They are no longer family friendly. They got rid of the games area and completely closed off the area near the bar. Have to pay to start the bottomless fries. They chose some dark pastel paint, which by the way resulted in a poor uneven paint job inside and out. Gone are all the nostalgic pictures and posters. Statue of Liberty gone too. They re-hired new staff, seem to want to cater more to a college crowd. There is no college nearby. Red Robin – DUMMMMMMB!
Visited RR for the first time in a while. Burgers were smaller, decor was remodeled but much less friendly. It is unlikely we will be back!
No more Red “Robin” bird logo. Weird, that was such a brand recognition item. I understand they are trying to go back to the college/bar crowd. But is that really were the money is? I worked for them as a manager for several years and honestly many of their ideas don’t make sense. Going away from “Kid/Family” environment? WOW, well I am moving my own restaurants more and more into the kid/family environment and my 10 have grown over 7% in sales; not a Red Robin.
My kids say they are not as excited to go back so I guess our weekly visits will turn into monthly. Sad, because they were the one place that as a Family we All enjoyed going to.
On a positive note, the food was still good and service was great also. Completely new decor.
The meat is smaller now on the burgers. We went there tonight and will never return. They charged us to give our kids fries before their meals too. Part of the reason we go there is the fries can keep the hungry kids happy till the food comes. They are no longer worth the extra money.
I absolutely HATE what they have done to Red Robin!!! They have completely ruined all that is good about the restaurant. We have 3 children, so we specifically choose Red Robin for the family friendly environment and great food. Our kids always pick it for birthdays, report card nights, and to celebrate. Unfortunately, our Red Robin is one of these new “test” restaurants. They removed the kids area entirely (no more video games, photo booth, etc). They had NO kids menus to color on (no crayons, either!). Just a white paper mat. They do NOT offer bottomless fries (you are charged extra for each basket). And the milkshakes are in smaller glasses and they don’t bring the silver container any more. So literally EVERYTHING that makes Red Robin special and fun is gone. We complained to our waiter who sent the manager over. The manager said Red Robins new focus is on ADULTS and alcoholic beverages. They will no longer cater to kids & families.
WOW.
Went to RR today. They still offered bottomless fries. I noticed the pattys were smaller immediately as they were brought to or table. I was upset. So i asked the manger o clarify this and he advised they have not made changes. My wife was embarrassed by me asking but she is also upset bite that the manger lied. We will no longer be going to RR anymore.
They are trying to move away from being a family restaurant? What kind of an insane business model is that? What a shame. I have to wonder what idiot told their board that this would be a good idea. Do they really think Adults are going to go to Red Robin instead of a bar? Their bread and butter was families. This has to be one of the dumbest things I’ve ever read. I will not be taking my family and kids back to this dump again.
We offer bottomless fry refills not “pre-fills”. That is a cheap way of getting an appetizer which we are not allowed to do. The meat is NOT SMALLER, we just offer a tavern size burger with two smaller patties. The games were taken away as to not annoy the rest of our guests. We started as a pub concept and are returning to that, it does not mean we are turning our backs on families just catering to a larger crowd. We still offer our MONSTER MILKSHAKE all you need to do is ask your server for that. We are in an age where you must make changes to compete and that is all this is. STOP COMPLAINING, there is always a McDonalds if you want cheap kid friendly places
I came here when looking to find if fries came with the burgers still at RR, since it doesn’t say on their web menu (!). RR might have more business if they state clearly on their menu that the price of a burger – which is a lot – INCLUDES fries. Instead of making all these other changes that are turning off long-term customers, make it obvious how the price charged is a good value (if this is the case!). It doesn’t help to tell people that if they want something they used to get that they can ask for it, instead of it being on the menu, and to stop complaining. Wow. I guess RR doesn’t want to know what their “guests” want or what they think – they only want to listen to corporate. Anyway, I don’t go there often (we are low-income), but we’ll probably go tonight to check it out, since I want to get the fish and chips. Hopefully that won’t be puny for the price or whatever, or else we won’t go back either; but we’ll see. Change doesn’t have to be bad, but from my own experience, changes in the last few years (or more) that come from the top of the corp.s just plain suck.
Wow. Such angst over fries. But to calm some of your many fears, yes, Red Robin still offers bottomless steak fries. And yes, it states that repeatedly on the menu:
http://www.redrobin.com/menu_info/pdf/new_menus/103877_Spiral_STND_01_LR.pdf