Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from the line of Chris O’Cull.
Christopher O’Cull - Suntrust Robinson Humphrey
Sandy, given the improvement you are seeing in these guest satisfaction scores, it appears the comp issue relates really to getting lapsed users to try the new Ruby Tuesday. In light of that, why reduce the advertising investment for ’09?
Samuel E. Beall
We’re reducing it substantially. I think it’s -- we gave them out, didn’t we, Steven? About $18 million? One, I don’t -- advertising gets a return; it doesn’t get a complete return. We’re more focused on cash flow.
With that said though, Chris, I think it’s important to say that we have a very good plan. If you’ll notice last year, we spent a lot of money in the first half of the year and we’ll just spend more of our money in a concentrated period of time, because you are right; we need to let people know that Ruby Tuesday is different. I think that’s the number one goal and I think we have the money to fund that.
And if things went really well, we may want to advertise more later. We can always invest more but right now, to achieve the $100 million in free cash flow, to achieve the sales that we are talking about, the earnings we are talking about, we think that’s all we need to spend.
Christopher O’Cull - Suntrust Robinson Humphrey
Okay. When you look at some of the programs you are planning for ’09, the marketing programs, would you characterize the communication more as a call to action or brand building?
Samuel E. Beall
Both.
Christopher O’Cull - Suntrust Robinson Humphrey
Okay.
Samuel E. Beall
[Easy] answer, isn’t it?
Christopher O’Cull - Suntrust Robinson Humphrey
Well, when you think about reintroducing the brand, will that be food focused, call to action type of messages? Or will --
Samuel E. Beall
You know, we’ll see. I mean, I don’t want to talk about -- we’ve got good plans. I think reintroducing the brand, you know, we’ll do that this fall some time, late fall probably, or something, and I think it will be effective. I think marketing has put together a good program that can get attention and get the message across to the consumer and can help entice people who haven’t been there for years and years and years. I don’t think it’s just a last year thing; it’s people going back maybe five, 10 years who just want a fresh or a different experience than the sameness that’s in the bar/grill segment of casual dining.
- To read the full transcript on Seeking Alpha, click here »
