Red Lobster lost a whopping $11 million in profits thanks to its popular endless shrimp promotion

It looks like Red Lobster’s all-you-can-eat shrimp deal may have been a bit too generous. Called Ultimate Endless Shrimp, the longstanding promotion invited loyal customers to indulge in all the shrimp their heart desired for just $20. It was launched by the seafood chain’s parent company, Thai Union, as a way to boost sales in restaurants, especially amid the third and fourth quarters when business is particularly slow. For more than 18 years, Ultimate Endless Shrimp remained a guest-favorite deal at Red Lobster — so much so that the chain made it a permanent addition to its menu back in June.

That ultimately led to major problems, the company said in its third quarter earnings. More customers took advantage of the promo, which in turn led to Red Lobster’s $11 million loss in the third quarter of 2023. “On this promotion, we don’t earn a lot of money. At $22 we don’t. The idea was to bring some traffic,” Thai Union CFO Ludovic Garnier said in an earnings call earlier this month, per CNN.

Despite the losses, the company still enjoyed a few major wins thanks to the promotion. Red Lobster saw a traffic increase of 2% compared to last quarter, and 4% compared to the previous year, CNN reported. What it didn’t anticipate, however, was the high volume of customers choosing to partake in the deal. For $20, guests could choose unlimited garlic shrimp scampi, coconut shrimp, shrimp linguini alfredo and plenty more… it’s truly too good of a deal to pass on! Red Lobster is gradually increasing its prices on the promo. The original $20 went up to $22, and is currently set at $25. 

“We need to be much more careful regarding, what is the entry point? And what is the price point we’re offering for this promotion,” Garnier said.