Friday, September 4, 2009

But can she leap a tall building?

It’s a good thing slime-dripping mutants from outer space haven’t attacked the restaurant industry in the last few weeks. Mustering a squad of superhero defenders would’ve been tougher than getting Alice Waters to wolf down a bag of Cool Ranch Doritos. A character named Price Slasher just wouldn’t fit an X-men team, even if any number of chain execs could have applied.

Then again, there is a new Clark Kent on the scene. Few have even noticed her, much less realized she can hold her own with the likes of Sally Smith of Buffalo Wild Wings, Jerry Deitchle of BJ’s Restaurants, and the industry’s own Dynamic Duo, Jim Skinner and Don Thompson of McDonald’s.

Gotham had certainly run amuck before Cheryl Bachelder, a one-time president of KFC, was hired in late 2007 to right AFC Enterprises and its fast-food business, the Popeyes fried-chicken chain.

Popeyes was KFC’s closest competitor, but a decidedly distant one. The brand had gone through more redirection in the prior years than a GPS provides in a decade. Under a succession of leaders, the concept had experimented with name variations, different formats, upscale recastings, and dramatic menu changes. They seemed intent on nudging the brand out of its quick-service niche.

Meanwhile, the core business stagnated. Units looked rundown and were often poorly located. Franchisees let their operations languish as headquarters cycled through more change.

Enter the caped Bachelder, promising yet more change, but talking dollars and cents this time. She explained that the 1,900-unit chain would spend $3.5 million to revamp its menu and marketing, and another $2.5 million to recruit better talent and improve service.

Then she changed the concept’s name from Popeyes Chicken & Biscuits to Popeyes Louisiana Kitchen. The bone-in fried chicken was itself renamed Popeyes Bonafide Chicken, and new premium products like a bowl meal and sandwiches were added. Simultaneously, Bachelder said the chain would tweak its menu to provide more portability and value.

It sounded like the same-old same ole—an attempt to be more upscale, without giving up the customers who just wanted inexpensive fried chicken. Similar past efforts had failed to pull Popeyes out of a Louisiana-grade swamp.

But Bachelder aired a sweeping plan to investors and staff. She cited lofty goals like improving the image of the brand, yet also mentioned minor tweaks like outfitting employees at the drive-thru station with headphones and timers. She later explained that handling three more cars an hour during Popeyes’ busiest drive-thru times would bump up comp sales by a full percentage point.

Marketing would be stepped up, as would deal making. The chain would emphasize portability, value, its Louisiana heritage, and on-the-bone fried chicken.

The strategy was notable for its detail and extensiveness, but not necessarily its approach.

Now, about a year into it, the plan is showing undeniable signs of success. Popeyes’ domestic comp-store sales for the second quarter hit 4.3%, outstripping the whole fast-food market by five percentage points, according to Bachelder.

A one-day discount—eight pieces of chicken offered for $4.99—had delivered “one of the best Wednesdays in our recorded history,” she told investors.

Bachelder also revealed that the chain would close as many as 120 underperforming restaurants.

Her moves were bold, but her predecessors at Popeyes hadn’t lacked gumption, either. What does seem different is how well-conceived her plan is, and how attuned it is to both the strengths and weaknesses of the brand.

Every turnaround amounts to building off a concept’s strengths with reasonable business-building measures. The artform is accurately identifying those strengths and astutely deciding what advances would complement that base.

It’s a superpower that Bachelder appears to have mastered, at least this far into the fight to save the world.

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