Tuesday, January 7, 2014

The Olive Garden Dilemma

The Olive Garden, a casual eatery best known for its limitless breadsticks and bowls of salad, is now serving up something a little different - a hamburger.  It's a six-ounce hamburger topped with prosciutto, mozzarella cheese, arugula, marinated tomatoes and garlic aioli.  They call it the Italiano burger.  While no one would ever mistake the Olive Garden for Tuscany, the addition of an American staple served with its own Italian twist should be viewed of as an underwhelming sign of desperation to jump on the gourmet burger bandwagon.

The dilemma for Olive Garden is that the brand has been repositioned and is now stuck somewhere in the middle ground.  Olive Garden isn't (nor has it ever been) the high-end, oh-so authentic Italian food.  It's Italian with more than a hint of casual Americana.  There is nothing wrong with that.  However, the rise of Italian-centric fast-casual restaurants is largely repositioning their brand.  Olive Garden was never the most authentic Italian restaurant ever; however, it's now no longer the cheapest option available either.

Adding a hamburger to the menu isn't going to solve this dilemma; the brand needs to cook up a new position that it can own.  Here are a few ideas for the Olive Garden to nibble on.

The position that I would most recommend is an Italian-style buffet.  Contract the menu down to around 10 dishes that can be served buffet style at a reasonable cost.  The brand, with its unlimited salad and breadsticks and numerous unlimited specials, is already somewhat positioned this way.  This would solidify that position.  Furthermore, this would be a strong counter position to take against Buca di Beppo, a competing chain that serves their dishes family-style.   

Or how about an Italian food-only take-out concept.  The Olive Garden can compete directly against the fast-casual restaurants that have repositioned the brand.  By specializing in take-out, the Olive Garden could reposition the fast-casual restaurants as a less convenient option for busy diners who still crave a higher quality.  This would also position them strongly against the "one entree, two-sides" model that's popular among grocery store to-go meals.

Another position the Olive Garden could take is to reposition the traditional American sports bar.  Simply by updating some fixtures and adding some glowing televisions to its restaurants, the Olive Garden would put a fresh spin on the traditional American sports bar, which never strays too far from a home plate of wings and pub food.

With so many more options now than even a decade ago, consumers need a reason to go back to the Olive Garden.  In the long-term, a new burger simply won't be that answer.  I believe that the concepts proposed provide make a much more compelling case - a leadership position in a category all their own.

How would you reposition the Olive Garden?  Let me know by clicking on the comments section below.  As always, thank you for reading and sharing this with your friends. 

Trending: Also see this piece by Brad Tuttle of Time Magazine on the subject.

No comments: