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Spaghetti Equity: Fazoli's Multi-Media Strategy

Restaurant chain Fazoli's promotes its new pasta dishes across the media landscape.

By Margaret Littman, Contributing Editor -- Chain Leader, 5/1/2009

Fazoli's baked pasta dishes include the Tortellini Robusto with grilled chicken and Italian sausage.
As it approached the ripe old age (for a restaurant company, anyway) of 20, Lexington, Ky.-based Fazoli's knew it needed a makeover. Customers were migrating away from the brand. The limited-service chain had closed underperforming units as part of a recent restructuring: It had 286 units when Carl Howard took over as president and CEO in June 2008; there are 264 today. In addition, a survey of customers last year found that the chain did not have enough "craveable products."

In response to these factors, Howard oversaw a complete overhaul of the concept's menu, with a focus on adding more baked pasta dishes and then devising ways to let lapsed and new customers know about them.

"We started with expanded baked pasta dishes because there is not a lot of competition," Howard explains. "Baked pasta is difficult to make at home, and you don't find the quality in the grocery store or in a lot of restaurants."

Not Half-Baked

The first change was the addition of deep-dish Pasta Rigatoni and other baked items. Initially the chain replaced about 12 percent of the menu and has incrementally implemented more menu changes. Before the menu revamp, baked pasta dishes accounted for about 8 percent to 10 percent of Fazoli's sales. Today that number is 22 percent. To date the average check has increased 11 cents. Existing menu prices were not raised; however, the new dishes are priced at or slightly higher than existing items. Because the advertising emphasizes the new menu items, the average check increased.

Promoting Fazoli's Italian Revolution
Later this month an additional 40 percent of the menu will be replaced with more baked dishes and desserts. At that point, approximately 80 percent of the menu will have changed since late last year. Fazoli's hired Nashville, Tenn.-based ad agency Bohan to find a way to market the repositioning.

Feeding a Revolution

First step: The team snatched up the self-explanatory URL www.freespaghetti.com, offering a dish that was inexpensive to make and well-associated with the brand. As the campaign caught on, the chain offered coupons and deals for the baked items and other new dishes as well, encouraging trial.

"We think we have a lot of equity in that. We think it is the best address," says Al Jackson, group creative director at Bohan. Consumers log on to the site, which is separate from the Fazoli's Web site, to access the coupons.

The site and campaign feature an "Italian Revolution" theme, encouraging consumers to send friends "pasta-gram" digital messages and download coupons for weekly specials. Two new offers are being posted every week from February to May. The microsite is not a mini version of the brand's main site, but instead an opportunity to focus on a specific message, says Jim Valosik, the art director at Bohan who created the site.

"Each media should take advantage of its own specialness, and being online is perfect for the media revolution," Valosik adds.

Fazoli's Web site
Visitors to Fazoli's Web site find a link to the freespaghetti.com site. Customers can join in the Italian Revolution, Fazoli's concept for its new baked pasta menu.
Fazoli's freespaghetti site
Results-Oriented

Fazoli's had three objectives for the Italian Revolution campaign, Howard says: to provide a budget-friendly menu in economically tight times, to awaken the 20-year-old brand, and to build its database of consumers who are interested in ongoing messages from Fazoli's.

Objectives achieved: Fazoli's increased the size of its database by 33 percent in just one month, and the number of users online in one month is equal to that which the chain used to get over an 18-month period, Howard says.

And those consumers are responding when Fazoli's sends follow-up offers. The concept has a 35 percent click-through rate on its e-mails, and coupon redemption is about 15 percent, considerably higher than redemption of print coupons.

Fazoli's has done this without breaking the budget. "It does not cost a lot of money to give away a free spaghetti," Howard says. He won't reveal the private company's advertising budget, but says in 2009 it will be more than the chain spent in 2008 but less than it did annually 2005 through 2007.

Some of those expenditures will be for television commercials that were in production at press time and scheduled to air in April and May. The spots will focus on the value of Fazoli's over its full-service competitors like Olive Garden and the quality of Fazoli's over other quick-service restaurants.

Adds Jackson: "We are always trying to find the most current ways to get the message out. Viral video, a texting campaign—we are open to trying things to spread the message."

 

Snapshot

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Concept Fazoli's

Headquarters Lexington, Ky.

Units 264

2009 Systemwide Sales $320 million*

Average Check $5.76

Ad Agency Bohan, Nashville, Tenn.

Expansion Plans 2 in 2009

*Chain Leader estimate

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