Dive Brief:
- TGI Fridays is one of the first companies partnering with Uber Vouchers, a program launched in April that pays for Uber rides to and from restaurants. Other initial partners include Live Nation Entertainment and Westfield.
- Sherif Mityas, TGI Friday’s chief experience officer, told Nation’s Restaurant News that the test is designed to drive foot traffic as well as create an additional experience for guests.
- Mityas said Uber provides the marketing channel for the voucher codes and TGI Fridays funds the program on the back end. There is a distance limit for those taking advantage of the program.
Dive Insight:
The partnership initially seems like a win/win for both the casual dining brand and the ride-share company. Uber had nearly 42 million users globally in 2018. The U.S. is its biggest market, so TGI Friday’s is putting its brand in front of a very wide audience of potential customers with this test.
Further, this service could very well be a key differentiator in a heavily saturated casual dining environment. And, as Mityas said in the interview with NRN, this partnership is less about driving loyalty than it is about driving traffic in a stagnant traffic environment, as it puts the brand top of mind for those who weren’t necessarily thinking about visiting until they visited to popular app.
“If there’s another opportunity for us to acquire traffic, we want to take advantage of that,” he told the publication in a podcast.
Customers who are intrigued by this opportunity will more than likely be those who order cocktails, a big opportunity for casual dining sales thanks to alcohol’s high profit margins. Liquor, for example, generates profit margins of 80 to 85%. For context, a cheeseburger yields between 5 and 15%. Those customers will be likely to order more using this service knowing they’ll have a designated driver.
Simultaneously, Uber could very well add more customers to its Eats platform, a heavy focus area for the company as it grows at a faster pace than its core ride-hailing business and as it looks to recover from a rocky start to its IPO.
Right now, this test is in about 40 or 50 restaurants primarily on the East Coast, Mityas said. TGI Fridays plans to gauge these initial results before making a decision on whether or not to roll it out across the country. The company is seeing incremental sales tied to dayparts that are more alcohol driven, such as dinner and late night. If this test succeeds, expect more restaurants to jump in.
