American restaurants from Chilli’s to Wendy’s have been launching deals to lure customers back.
But Olive Garden has said it will not do so, angering customers.
“We’re not going to do that,” Rick Cardenas, chief executive of Olive Garden’s parent company, Darden Restaurants, said during a conference call with analysts last month.
“Even at a time when our competitors have increased discounts.”
He was referring to full-service rivals like Chilli’s, which has an appetizer, entree and drink deal for $11, and Applebee’s, which has two-for-$20 deals.
Fast food chains have also launched offers. McDonald’s, Burger King and Wendy’s have a $5 meal deal that includes a burger, nuggets, fries and a drink.
Olive Garden has promised not to offer discounts, unlike Chilli’s, Applebee’s, McDonald’s, Burger King and Wendy’s.
In fact, Olive Garden has said it will raise prices this year.
The pandemic prompted chains to raise prices due to rising costs and consumers’ willingness to pay more.
But recently, diners have begun to react, leading many restaurants to offer temporary discounts on these increased prices.
Not only is Olive Garden refusing to offer deals, it is raising prices by 2.5 to 3 percent this year.
The move comes despite sales falling 1.5 percent year-on-year.
Cardenas added: “We believe that the everyday low price… is more sustainable than deep discounts to try to attract people,” he said. “For us, this is a long-term play.”
Instead of deep discounts, Olive Garden plans to attract customers by highlighting its regular deals, such as its free breadsticks or soup and salad refills.
He said: “Our best way to drive sales is to focus on a back-to-basics operating philosophy and have our customers tell others what great value they get when they come to our restaurants.”
