Texas Roadhouse has never advertised nationally. | Photo: Shutterstock
In May 2024, Texas Roadhouse introduced its first ever “purpose statement”: “Serving our communities across America and the world.”
The phrase highlights both the steakhouse chain’s community focus and its global ambitions.
Since then, the Louisville, Kentucky-based chain has ascended to become the largest casual-dining chain in the U.S. by systemwide sales, thanks to quarter after quarter of sales and traffic growth as well as a steady pace of new-store openings.
Today, it has 755 locations, including 62 overseas. It is by every definition a national brand, with a growing global profile as well.
And yet it still acts like a local restaurant, a practice that it believes has contributed to its success.
Unlike most chains with a national footprint, Texas Roadhouse has never spent a dollar on national TV ads. It doesn’t plan to change that anytime soon, CEO Jerry Morgan confirmed on an earnings call Thursday.
“We absolutely believe [in] that local store marketing, grassroots kind of approach,” Morgan said. “Getting out into the local communities, shaking people’s hands, delivering some fresh baked bread, and just talking about Texas Roadhouse and what we can do for them, for their business, for their families.”
It might sound a little saccharine if it didn’t seem to be working so darn well. In the second quarter, Texas Roadhouse’s same-store sales rose 6.2% on 3% traffic growth. That’s 12% same-store sales growth on a two-year stack, 21.3% over three years, 30.4% over four … you get the idea. The chain has not recorded a same-store sales decline since 2010, excluding the pandemic.
Its approach is even more impressive given the marketing blitz happening across the rest of the industry as restaurants jockey for choosy customers.
Texas Roadhouse has not needed that sort of broad-based marketing to drive traffic. It continues to bring more customers into its restaurants every quarter.
A big part of that has been good operations. When asked how the chain is able to keep outdoing itself, Morgan typically responds with something like this, from Thursday:
“We obviously are continuing to have momentum on traffic, which means to me that we’re opening or operating quality shifts and that we’re finding ways to get more people through the dining room.”
Recently, Morgan has credited some of the chain’s tech investments, like the option for customers to pay at the table and a new digital kitchen system, for allowing restaurants to manage higher volumes.
But he also points to factors that are harder to measure, like “energy.”
“Just being energetic when it comes to serving people, I think, it’s really what’s paid off for us for a long time,” he said Thursday.
And then there is that grassroots approach. On the earnings call, Morgan revealed that Texas Roadhouse has a “first-time guest program.” When restaurants identify a new customer, staff will take a minute to [tell] our story, who we are, how we do business, and how we approach things.”
That down-home service style is aided by Texas Roadhouse’s reputation for quality food and reasonable prices. The chain has historically not raised prices to offset inflation, which has impacted its margins in recent years. But it has paid off in the form of better sales and traffic.
All of that has generated strong word of mouth for the chain, which, as almost any business can attest, is the best form of marketing there is.
That word of mouth showed up during the World Cup tournament this summer, when visitors from around the world experienced Texas Roadhouse for the first time and posted about it on social media.
“These guests fell in love with our high-level hospitality and legendary food, especially our fresh baked bread and those free peanuts,” Morgan said. “These experiences inspire us further as we continue with our purpose of serving our communities across America and the world. Let’s go, Roadhouse!”
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