The Cheesecake Factory plans to test “modest but highly targeted” TV advertising in 12 markets in hopes of capturing more traffic, President David Gordon revealed to investors yesterday.
The initiative was revealed after Cheesecake posted a 1% rise in same-store sales for the second quarter. That gain came despite a 2.8% drop in transactions, said CFO Matt Clark.
News of the plan was overshadowed by the simultaneous announcement of Cheesecake’s planned acquisition of Fox Restaurant Concepts. Yet it caught the attention of financial analysts during Cheesecake’s Q2 conference call.
Gordon said the TV ads will not spotlight an offer or other call to action. Rather, he said, the spots will aim to embellish the brand’s appeal by focusing on its preparation from scratch of 250 menu items. “We'll measure it over time during the pilot phase and then see what we want to do moving forward,” said Gordon.
He did not reveal the cost of the commercials or where they might run.
Cheesecake posted a net income for the quarter of $35.5 million, a 25% increase over the year-ago figure. Revenues topped $602.6 million, up 2.6%. It ended the quarter with 202 restaurants in operation.