In a surprising turn, Olive Garden has decided to embrace food delivery, striking an exclusive partnership with Uber. Known for its famous breadsticks and pasta, the casual dining chain has long resisted third-party delivery services, but that’s about to change. Starting later this year, Uber will deliver Olive Garden meals at select locations, with plans for a national rollout to over 900 restaurants by next May if the pilot program is successful.
Breaking Tradition as Olive Garden Teams Up with Uber
For years, Olive Garden stood firm on keeping its operations in-house, even as many competitors joined forces with delivery services like Uber Eats and DoorDash. The chain offered catering orders delivery, but this new partnership signals a significant shift. Uber Eats drivers will now handle deliveries, although you won’t find Olive Garden on the Uber Eats app. Customers will still need to order directly from Olive Garden’s website or app, where Uber will facilitate the delivery.
Darden Restaurants, Olive Garden’s parent company, shared the reasoning behind this move. CEO Rick Cardenas explained, “Guests have been asking us for home delivery options, and they continue to show they are willing to pay for the convenience.” Cardenas emphasized that Uber stood out as the ideal partner because of its ability to provide valuable customer data without undermining Olive Garden’s operating model.
Olive Garden’s decision to partner with Uber comes after years of hesitation. Even at the height of the pandemic, when delivery services surged in popularity, Olive Garden chose not to jump on board, citing concerns about profitability and food quality. The company feared that using third-party delivery would eat into its revenue and impact customer satisfaction.
However, the dining landscape has evolved, with customers increasingly expecting delivery options. According to Cardenas, “Uber was a clear choice for a partnership because it’s giving the chain guest data and insights that don’t hamper its competitive advantages.” Essentially, Olive Garden is adapting to customer preferences while keeping control of its brand experience.
A Boost in Darden’s Stock After the Announcement
The announcement of this partnership had an immediate impact on Darden’s stock, which surged 9% in midday trading. The news came at a time when Olive Garden was experiencing a challenging quarter, with a 2.9% drop in same-store sales. While it has weathered the storm better than many, the delivery partnership with Uber is expected to ease some of the financial strain and drive more sales.
Though Olive Garden’s financial performance has faced some bumps, Darden remains optimistic about its overall brand portfolio, which includes popular restaurants like Yard House, Ruth’s Chris, and Longhorn Steakhouse. Darden reiterated its full-year outlook, confident that this new delivery strategy will help boost revenue and attract more customers.
Olive Garden’s Strategy in a Competitive Market
One thing that sets Olive Garden apart from its competitors is its approach to pricing. While many restaurants have responded to inflation by raising prices and then offering temporary discounts to draw customers back, Olive Garden has taken a different route. Instead of frequent promotions, it has opted to hold the line on prices as much as possible and offer occasional deals like the ever-popular Never-Ending Pasta promotion.
This strategy has helped Olive Garden maintain its profitability even as other chains have faced pushback from price-sensitive diners. With the new Uber partnership, Olive Garden is betting that convenience will keep its customers loyal, even as dining habits shift.
As Olive Garden prepares to launch its delivery service through Uber, the pilot program will be closely watched. The partnership begins at a limited number of locations, but if successful, it will expand to over 900 Olive Garden locations across the U.S. by May of next year. The chain will continue to manage orders through its own platforms, keeping a level of control over the customer experience while reaping the benefits of Uber’s extensive delivery network.
This partnership with Uber represents a big step for Olive Garden as it adapts to new consumer preferences and technological advancements in the restaurant industry. For customers, it’s a win—they can now enjoy their favorite Italian meals delivered straight to their door.
Olive Garden’s partnership with Uber marks a significant change for the beloved restaurant chain, reflecting the growing demand for convenience in the dining industry. By teaming up with Uber, Olive Garden is taking steps to meet customer expectations while maintaining control over its brand and service quality. As the pilot program rolls out and expands nationally, Olive Garden is poised to enter a new chapter in its long history of serving up comfort food with convenience.
