From free cheesecake to dollar drinks, casual dining shifts focus to millennials

Dive Brief:

As part of its 40th anniversary celebration, The Cheesecake Factory partnered with DoorDash to give away 40,000 free slices of cheesecake Wednesday to customers ordering through the app — driving significant social media interest and a flood of orders on DoorDash, according to USA Today. The Cheesecake Factory and DoorDash entered into a partnership during the third quarter.
Applebee's and IHOP, owned by Dine Brands Global, have also increased their promotions, such as dollar cocktails and social media campaigns — including IHOP's Twitter campaign to change its name to International House of Burgers — to market to more millennials, reports Skift Table.
Following these campaigns, Applebee's increased comparable-sales by 7.7%, and IHOP's burger sales increased fourfold last quarter.

Dive Insight:

Casual dining has had trouble innovating and competing with quick-service and fast casual brands in recent years. While sales across the 500 largest U.S. restaurant chains increased 3.2% last year, casual chains increased sales a mere 0.1% in 2017 and unit count decreased 1.4%, according to Restaurant Business. Applebee's, Chilli's, Ruby Tuesday and TGI Fridays were among the casual dining restaurants to post single- to double-digit declines in 2017. In response to these lackluster results, Chilli's pared down its menu while Ruby Tuesday reviewed its strategy, leading to an acquisition by private equity firm NRD Capital.

Many casual chains, including Applebee's and IHOP, shifted their marketing focuses to appeal to more millennials by offering various promotions, new social media strategies or creating more robust off-premise operations. And so far, it's worked.

Applebee's Dollarita and other drink promotions and IHOP's tweet about changing its name to International House of Burgers have helped get people in the door and talking about the brands. (IHOP's IHOb tweet generated 44 billion impressions on Twitter.) Additional focus on off-premise also resulted in a 37% increase in to-go orders and a 30% increase in check sizes for Applebee’s and IHOP combined during the third quarter, according to Skift Table.

But not all strategies have run smoothly. While The Cheesecake Factory’s promotion generated a lot of interest and excitement, the promotion backfired a little bit. In Arlington, Virginia, a surge of delivery drivers overwhelmed a local Cheesecake Factory, and police were dispatched following reports of a fight in progress at the restaurant and arrested one individual for disorderly conduct. Customers also reported long delays in receiving their free cheesecake, trouble accessing the DoorDash app or that their local Cheesecake Factory was outside of the deal.

Even though many of these promotional campaigns from casual dining chains have been hit or miss, they got people talking about the brands, and The Cheesecake Factory could very well post a boost in sales now that everyone knows it delivers through DoorDash.