Would You Eat Sushi at a TGI Fridays?
JET AI + Ads, Rite Aid forgot delivery, eGrocery sales update
Just when you thought ghost kitchens were dead, TGI Fridays and Krispy Rice are serving them a second life, alongside some suspiciously prepared nigiri. Meanwhile we’ve got an interesting new push from Just Eat Takeaway, an update on digital grocery sales, and some thoughts on how Rite Aid fumbled. Read on!
Today:
Krispy Rice Serves Sushi in TGI Fridays
Just Eat Takeaway Debuts AI & Ad Campaign
Chart Time | l eGrocery Languishes in September
Rite Aid Delivers a Bankruptcy
VIRTUAL BRANDS | TGI Fridays To Serve Up Krispy Rice
Casual dining and bar chain TGI Fridays announced it’ll be serving up sushi and hand rolls from C3’s virtual delivery brand Krispy Rice. The partnership is live at 140 restaurants, with plans to expand to 300 locations; TGI Fridays expects to bring in over a half a million dollars in incremental revenue per store. As the average TGI Friday location made about $2.8M last year, that represents around an 18% lift to sales. Concurrently, TGI Fridays also announced a handful of other new brand partnerships — Happy Dad Hard Seltzer, UFC impresario Dana White’s Howler Head whiskey and WESAKE.
The Big Picture: Just as we thought virtual restaurants were quieting down, this announcement pumps new energy into the segment… but there’s some big execution risk here. If there’s one problem that’s dogged ghost kitchens in the past, it’s quality and consistency; something tells us that Krispy Rice isn’t going to be sending a sushi chef with 10 years of training to each TGI Fridays mall outparcel location. Krispy Rice is a spin out from C3’s Katsuya brand, which at one time was thought of as rather high end. If you read the reviews for many previous Krispy Rice locations, it’s clear they’re not exactly nailing the operations, and this could tarnish the brands of all parties involved. Note this Krispy Rice in LA where every single review is 1-star. Also note that location appears to be associated with REEF, which has gone through its own struggles, but is an investor in C3, alongside TGI Friday’s parent company TriArtisan Capital. Also unclear is the status of previously announced TGI Fridays and C3 collaborations, like Kumi and Stonie Bowls.
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3PD | Just Eat Takeaway Launching AI Assistant, New Ad Campaign
Ahh, it’s been days, DAYS, since we’ve gone without word of a new AI assistant for delivery. Fortunately, Just Eat Takeaway.com is filling that gap, as it just announced that it’s working on a time-saving assistant of its own. Per the company’s example, you can type that you want an “egg and cheese mcmuffin” and it will summon a McDonald’s order into your shopping cart. Just imagine the super computer it takes to figure that one out… On the slightly more fun sided of things, the company is extending its celeb-focused “Did Somebody Say?” ad campaign to the UK, calling on Christina Aguilera and Latto to sing about all the food they can get on JET’s app (sadly there are no rap bars about the AI.)
The Big Picture: Both these announcements feel, let’s say… reheated? News of DoorDash’s chatbot was leaked back in July, and Uber’s was discovered in August. Instacart premiered its AI-powered tool way back in May, and at least that one had the slightly more useful ability to make recipes. As for the ad campaign, Just Eat Takeaway.com first launched that in the U.S. last month, featuring Snoop Dogg. The company states it plans to further extend the creative to new countries and languages in the coming months. Given that JET operates using different trade names in many of its markets, what’s the value in having a unified international ad campaign?
CHART TIME | eGrocery Sales Monthly Update
Time to check in on the wild of world online grocery sales, which Brick Meets Click reports is down 3.1% YoY, down even more from last month, and has order frequency (2.31) at its lowest levels since pre-pandemic. Mass retailers saw a 4% decline; Amazon’s pure-play segments fell 7% and supermarkets dropped almost 13%.
OPERATIONS | Did Lack of Delivery Drive Rite Aid to Bankruptcy?
You’ve probably heard by now, but on Sunday drugstore retailer Rite Aid filed for bankruptcy reorganization. The company was once the largest pharmacy chain in the U.S., but today it languishes in about seventh place, behind not only CVS and Walgreens, but retailers like Walmart and Kroger, plus mail & specialty groups like Express Scripts and OptumRx. While the company had been shedding stores for years, it was recently pushed over the edge by a slew of lawsuits related to opioids like Oxycontin.
The Big Picture: Not to be predictable, but there’s also a delivery angle here, or specifically a lack of one. Anyone that’s been to a CVS in the past few years knows how hard the company pushes CarePass, its $5/mo service that offers 1 or 2-day shipping on most goods, plus same or next-day delivery on pharmacy orders, as well as in-store discounts. Walgreens’ free myWalgreens offers 30 minute curbside pickup or 1 hour delivery. Rite Aid’s Wellness+ is less generous, more confusing, and doesn’t offer any delivery benefits. In fact any mention of “same day delivery” is essentially absent from the Rite Aid website, although a quick Google search reveals they’ve sourced it to Instacart. The company also essentially ceded the pharmacy benefits management / prescriptions by mail business; its subsidiary Elixir was bought in 2015 and is only valued at $2 billion, far smaller than CVS Caremark.
A Few Good Links
How two Florida scammers ripped off Uber Eats for over $1M. Pizza Hut goes after late night hunger. Albertsons says consumers are spending less as gov’t reduces benefits. Amazon to open in South Africa. Instacart gets analyst ratings — mostly positive. Hooter’s turns 40; perhaps some concepts don’t translate well to delivery. Uber Eats launches iOS widget. Yooga wants to be the Toast of LatAm.
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