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Red Lobster Case Study

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Case Study – Red Lobster

Background Red Lobster was originally founded in 1968 and gained tremendous popularity since at the time, mainstream Americans ate very little seafood, finding it hard to get, difficult to cook at home, and expensive. Red Lobster made seafood accessible, approachable, and affordable for just about everybody. Even with their instant success, Red Lobster by 2004 was becoming out of date and out of touch with today’s customer. Kim Lopdrup took over as president in 2004, initiating an aggressive turnaround program and a three-phased plan to save Red Lobster. In the following case study analysis our team has evaluated Red Lobster throughout the innovation.
Who were Red Lobsters target customers pre-2004? Prior to Kim Lopdrup taking over as president of Red Lobster in 2004, their target customers were known “experientials.” Experientials are people who love generous portions of affordable seafood, but use the meal occasion as more of an opportunity to connect with family, friends, colleagues, or clients. Red Lobster also had a lot of lapsed users who thought of them as a dated chain that served cheap, frozen, mass-produced seafood. In Lopdrup’s first few years on the job, he initiated an assertive turnaround program and showed some early signs of success.
What was Red Lobster’s value proposition? Red Lobster was built on the premise of bringing affordable seafood to mainstream America. Prior to 2004, Red Lobster’s management team had tried to focus on “freshness” and take it beyond just being affordable. While they tried to not raise prices, they did scale back on the chain’s general price promotions.

Who were Red Lobsters main competitor’s pre-2004? In the seafood industry, Joe’s Crab Shack was really the only national dining chain near Red Lobster’s price point, at $19 per individual ticket. Long John Silvers was the only

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