Dive Brief:

• Chuck E. Cheese partnered with DoorDash to delivery its new Pizza Party Pack, a 12-person kit that includes three large pizzas, a decorated signature Chuck E. Cheese’s Cake and party decor and supplies, according to a press release. 
• The $125 meal runs about $10 per person and is currently only available in San Diego, but the restaurant is also considering it nationally.
• This program is part of the company's growing delivery channels, CEC Entertainment Chief Marketing and Concept Officer Ashley Zickefoose said in the press release.

Dive Insight:

For eatertainment chains like Chuck E. Cheese, offering delivery seems like an odd move, especially since more than half of its revenue in the first quarter came from entertainment and merchandise sales. Nonetheless, Chuck E. Cheese started offering nationwide third-party delivery through Grubhub, Uber Eats and DoorDash in 2018 following a successful test in Dallas, Tampa, Orlando, Miami and San Francisco. Offering a party pack is meant to appeal to various events from office parties to backyard birthdays, indicating that the restaurant is also trying to broaden its target market to other demographics and not just families with young kids.

The company also has been facing increased competition from bounce houses and trampoline parks so this off-premise push could also be its way of diversifying its revenue stream. Following its transaction with Leo Holdings, the company will become public, which also means it will be under additional investor scrutiny to keep growing profits as it did by the end of 2018. Diversification through enhancing the dine-in experience with remodels and its All You Can Play passes, plus considering international expansion, will be key strategies for the company to maintain its growth trajectory.

This new catering-style offer appears to be just one more move to diversify its business. Many other restaurants, including Red Robin, Chuy's, Cracker Barrel, and Noodles & Co. have been building up catering for office and private events in recent years, especially since catering is growing twice as fast as the overall restaurant industry. Given the double-digit growth some of these brands have already experienced in recent quarters, Chuck E. Cheese could very well see a boost in food and beverage sales from its party packs.