BrandIndex's October value rankings of casual dining chains in Mediapost

Olive Garden Ranked Best Casual Dining Value

Consumers perceive Olive Garden and Cracker Barrel as offering the best value among casual dining restaurants, according to rankings for the month of October from YouGovPolimetrix's BrandIndex. Hooters and Buffalo Wild Wings were ranked lowest on value. BrandIndex tracks more than 1,000 consumer brands, gathering opinions on seven brand-health indicators on a daily basis from 5,000 U.S. adults drawn from an online panel of more than 1 million. The seven indicators are also rolled up into an overall brand-health index score. The margin of error is +/-2%.

The "value" score--reflecting consumer responses to the question: "Does it give good value for what you pay?"--is clearly one of the most powerful brand-health indicators, particularly in the current economy. Thus, this is the focus on analyzing this indicator for October, explains BrandIndex SVP and general manager Ted Marzilli. Any BrandIndex score over zero represents a positive perception, and any score under zero represents a negative perception.

The average value score for the 29 casual dining restaurants tracked was 10.8 last month, according to Marzilli. Olive Garden and Cracker Barrel came out on top, with scores of 39.9 and 32.9, respectively.

Olive Garden is a "perennial top-scorer" on value because of its salads and large portions, says Marzilli. Cracker Barrel, which showed the highest value-index gain among all casuals for the month (+6.2), seems to be benefiting from its first advertising campaign in about a decade. "The advertising is in limited markets, primarily in the South, but its message of Cracker Barrel being a 'home away from home' seems to be striking a chord in this poor economy," Marzilli observes.

Applebee's came in a close third at 32.3, but it also showed the largest decline (-5.7) on the value index during October. Noting that Applebee's has been consistently ranked high in value, Marzilli says that last month's reading "could be a blip."

Other chains ranked among the highest on value included Denny's (26.6), Pizza Hut (24.6) and Chili's (23.5), which had the second-highest value index gain last month (+4.6). Chili's current advertising stresses "flavor and fun" rather than a direct value message. However, "consumers are clearly seeing something that's causing them to reassess Chili's for the better in terms of its value," notes Marzilli.

Chains ranked above average on value included The Cheesecake Factory (19.8), TGI Friday's (18.9), Ruby Tuesday's (15), Golden Corral (13.4), Red Lobster (12.7) and Bob Evans (12.6).

Macaroni Grill also came in barely above average at 10.9, but saw the second-biggest value index loss for the month (-5) and was at its lowest value index point thus far this year, reports Marzilli. This may indicate that its promotion of Chef's Trio--a three-course meal for $11.99--either had not yet kicked off and might yield perception gains as of November, or that the offer is not resonating strongly with consumers, he adds.

Those ranked below average included Red Robin (9.3), Carrabba's (6.2), Famous Dave's (5.9), Fuddruckers (5.3), Sizzler (5.3), California Pizza Kitchen (5.2), HomeTown Buffet (4.2), On the Border (3.2), Luby's (2.1) and Landry's Seafood House (1.6). Barely in the positive column, with indices below +1, were Houlihan's, Pei Wei Asian Diner, and Benihana.

Hooters was by far the lowest-ranked on value, with a -14.3, followed by Buffalo Wild Wings (-1) and Bahama Breeze (-0.4). (Bahama Breeze and Red Lobster are owned by the same parent company as Olive Garden--Darden Restaurants.)

Within the overall restaurant context, casual dining chains as a whole showed a small decline in consumer value perceptions, while quick-serve restaurants were up a bit, according to Marzilli. This may indicate that more consumers are trading down and "branding to" QSRs as they scale back on expenses, he notes.