Smaller Portions Equals Success for Friday's

JULY 24, 2007 — -- Ten months ago as the casual dining industry was suffering its worst downturn in a decade, T.G.I. Friday's, the popular American restaurant chain, commissioned a focus group.

The group offered an interesting perspective -- it said Friday's portions were just too big.

"This is a little scary for us," said Richard Snead, chief executive of Friday's. "And it is uncharted waters. Over the years, bigger has been better." Snead decided to act on these findings, but he did so with some trepidation.

Watch the story on "Nightline" tonight at 11:35 p.m. EDT

In the past when restaurants offered less food, customers left in droves.

Snead is a hard-charging 55-year-old who spends his days racing from one Friday's to another, making sure his staff keeps the customers coming back.

And with a new strategy of lowering portion sizes, Snead was hoping to add even more customers. He thought it was a risk worth taking, and last month Friday's reported that it's "Right Portion, Right Price" menu brought with it an increase in diner traffic.

According to Friday's, by this past June, customer numbers had grown by 1.4 percent for the chain, while the rest of the casual-dining industry saw customer numbers drop by 2.8 percent.

The chain has taken 10 dishes -- four of its most popular ones -- and told customers they can either order the standard enormous portion, or select something called "Right Portion Right Price" which is about a third less food and about 40 percent cheaper.

"This gives you a chance to still indulge and eat less without having to pay for it and take it home and put it in the refrigerator," he said.

When ABC News first reported the story, business analysts were not optimistic. They believed Friday's was attempting a high-wire act of sorts, by trying to increase its customer base at a time of ferocious competition.

"I don't know if it's going to work or not," said David Johnson, business analyst for PRI Marketplace. "I know in the restaurant business you always need to have a point of difference. Sometimes, they open up the kitchen and you can see the chef over there; sometimes they have little private booths, sometimes they have spinning salad bowls or flaming this or whatever. As far as I'm concerned, it's the same thing."