Ruth's Chris Steakhouse ($RUTH) is getting a ton of attention on social media. It is mostly the wrong kind.
Ruth's Chris needed, applied for, was approved for and accepted $20 million in loans the federal government made available for businesses but was harshly criticized for taking money that many small businesses may also need in order to maintain operations when the US economy finally rebounds from the pandemic. Now, it's giving the money back, after seeing Facebook ($FB) chatter rise to highs seen in more than a year - just about all of it, chastising the steak chain.
Over at Ruth's Chris Facebook page, you can check out some NSFW comments being lobbed at the brand by people - many of whom may not necessarily have even been recent or regular visitors to the restaurant. We're not going to repeat their statements here, this is a family publication.
How brands manage not just their interaction with the government loan program, but their ongoing engagements with consumers, can make or break a company in the long run. And - as was the decision to accept government funding that small businesses also needed - many organizations are struggling with the simple fact that not everyone can necessarily be refunded. That may have been the case for vacation startup Sonder, which saw similar rising social media engagement, and, where we could tell, complaints.
Returning the $20 million loan won't earn back Ruth's Chris happy consumers, and the company is in the difficult position of needing to fund continuing operations and maintaining solvency at the most challenging of times. Other companies move to do things like duck their realtor could get them dragged to court - but not dragged on Facebook. Whether it all adds up to long-term damage for Ruth's Chris remains to be seen - after all, the restaurant still makes a great ribeye.
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