Smaller Portions Equals Success for Friday's
Friday's says that bigger is not always better, and its customers agree.
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.
Cheaper Choices, Smaller Portions
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."
Johnson was also wary of the portion-size change. He believed that larger portions leave customers with the option of feeding a friend. Friday's executive chef Phil Costner said there is nothing wrong with feeding a friend, but it's much more important that friends be able to order exactly what they want to eat.
Costner says customers are devouring their new, smaller portions.
Clean Plates Are the Measure of Success
"We want to get as many flavors into as many mouths as we can," said Costner. "So for us, one of the measures of success are clean plates coming back to the kitchen. So that is a big number for us."
Snead said Friday's, which has 1,000 restaurants around the world, is learning from cultures like France and Italy, where portions are smaller.
"[In] a number of places where you're in, I don't want to say secondary countries, but smaller economically developed countries … it's disrespectful to waste food, and we're careful not to do that," said Snead.
In the age of monster-size value meals, triple whoppers and 64-ounce soft drinks, Americans are consuming 12 percent more calories a day than they did in the 1980s, while company profits continue to rise.
More Customers, Less Overeating?
Friday's is one of the few restaurant chains that is privately held, which means that there is no pressure from stockholders to beat quarterly numbers. In turn, Friday's is free to take a long-term approach.
"If we were a public company, I don't know if we could do this as easily as we have," said Snead. "They have actually encouraged us, you know, to do this. So that's been a good point of difference for us."
Friday's portion plan also has the benefit of giving better options to customers who live in a country plagued with health problems that stem from overeating.
"Without trying to be overly noble about it, what we hope we're doing is giving people good choices. And I'll tell you. I don't think you're going to go away hungry. We're not going to have to send you through a drive-through on the way home when you have a three-quarter pound of ribs."