Spam Not on the Menu at Red Lobster
The world's largest seafood restaurant chain is incorporating dynamic content delivery for more targeted communications and adding more features to its online invitations component as it fine-tunes its Internet strategy.
"Our goal is to use the channel to build loyalty among members and increase their level of interaction with our brand both inside and outside the restaurant environment," said Michael Friedman, interactive marketing manager at Red Lobster, Orlando, FL.
The company has 704,000 members in its Overboard Club online loyalty program. Responding to their needs online is critical to ensuring repeat visits to Red Lobster restaurants nationwide and in Canada.
Take dynamic content delivery. Work is on to build Red Lobster's online recipe cards. This feature lets consumers share their favorite recipes by e-mail. Now it is evolving into something more tailored to members' specific food and beverage interests.
"Content -- text and images -- will be served dynamically based on their customers' and subscribers' specific interests or past interactions with promotions or programs," said Tim Marusich, CEO of BlueHornet Networks Inc., a San Diego and Chicago e-mail service provider working with Red Lobster.
Similarly, the online invitations feature is changing. A host user can plan an event like a birthday or happy hour at a Red Lobster, track responses to invitations and send updates to friends on the list. The chain will even deliver targeted rewards to event hosts dynamically through e-mail.
The Overboard Club is valuable for Red Lobster as well. The 3-year-old program gives consumers exclusive information, members-only sweepstakes and prizes. In addition, the company produces an e-mail newsletter that coincides with the launch of promotions year-round. Loyal members get monthly communications about restaurant news, sweepstakes and rewards. The company offers different newsletter versions for U.S. and Canadian members.
Red Lobster has 670 restaurants in North America and 65,000 employees who served 144 million diners last year. Revenue in 2003 rose 4.1 percent to $2.4 billion. It is a subsidiary of Darden Restaurants Inc., owner of chains like Olive Garden, Smokey Bones Barbeque and Grill, Seasons 52 and Bahama Breeze.
Since e-mail is such an important element of Red Lobster's marketing, the brand has embraced double opt in. This offers the company predictable database growth with few defections. For instance, it had 8,343 new members in May and only 150 opt outs. The annualized defection rate typically is 0.5 percent.
Complying with federal anti-spam laws is not enough, Marusich said. ISP requirements, corporate MIS standards, consumer perceptions and the company's history of e-mailing are critical.
"BlueHornet has discouraged all of our customers from buying lists, using rented lists and even doing list appends because, without affirmative consent, you're sending unsolicited commercial e-mail, or spam, and consumers and ISPs are furious," he said. "Our solution is simple. Do creative data collection, where the consumer provides permission to send to them, and confirm it through double opt in."
Brand protection has become a key feature of BlueHornet's delivery management services. It does this by preventing spam and quickly investigating consumer complaints.
E-mail delivery is central to any marketer's communication strategy. A recent survey by DoubleClick Inc. said delivery was the top concern for e-mail marketers.
"We see a surprisingly high number of missing and blocked/filtered e-mails in the industry," Marusich said. "However, Red Lobster has significantly high delivery rates [consistently over 90 percent]. A large competitor of ours quotes '95 percent to 97 percent deliverability rates,' but they don't tell you that that number includes 8 percent to 15 percent going straight into the bulk mail folder."
Pivotal Veracity LLC, Sarasota, FL, helps BlueHornet and its clients see where their e-mails go with the use of auditing and testing tools. Before a campaign starts, Pivotal Veracity's eContent Scorer lets users analyze the sending infrastructure, mailing methodology and e-mail content against all major spam filters and black lists used by firms, ISPs and end users. EDelivery Tracker audits the entire e-mail delivery process.
Like any smart marketer, Red Lobster has spread its dollars into disciplines other than its e-mail newsletters and loyalty program. The Web site at www.redlobster.com is information-rich, reflecting the brand persona.
In other outreach, Red Lobster uses online advertising to drive gift card sales, participation in restaurant events like product launches and local marketing opportunities. Such ads also push Live Lobster Overnight, a program for letting users send live lobsters anywhere in the United States as an overnight gift.
Offline, the chain uses television, radio and direct mail. The Richards Group, Dallas, was named in March to handle offline marketing. Real Branding, San Francisco, was tapped a few weeks ago for interactive marketing.
It is clear, however, that the Internet is central even to a business like Red Lobster that gets almost all its revenue offline.
The Internet "offers the ability to showcase amazing food and beverage photography like television, tell stories like radio and communicate a strong value proposition like direct mail," Friedman said. "However, it brings the added bonus of combining a highly sensory experience with responsiveness to customer wants and needs that can and do turn on a dime."