Tuesday, July 23, 2013

News nuggets you might've missed today

Domino’s finds tech to be a market share gainer
Who says discounting is the only way to snag pizza customers? Domino’s is learning that technology can also pull market share from competitors, especially mom-and-pops.

“Our focus on technology and consumer access via digital ordering continues to give us an edge over our competition,” CEO Patrick Doyle explained to investors after revealing that the chain has updated its app for the new Windows Phone 8.

It’s an advantage “particularly versus the smaller players that continue to lag behind,” Doyle continued. “Even if the regionals catch up to the level of technology we currently offer, we're already several years ahead of them and expect to keep pushing to lead the industry on technological innovation.”

Doyle was asked how much of Domino’s business will come from digital ordering platforms in the future. “I certainly think that we'll see it above 50%,” he replied. “We've got 3 or 4 countries that are now at that level.”

Doyle noted that most of the chain’s sales growth is coming today from the theft of competitors’ business rather than from growth of the whole pizza segment.

Oh, good: More on the royal birth…
Restaurants can turn any high-profile event into a promotional opportunity, even the rare birth of a monarch. Consider, for instance, Dunkin’ Donuts’ introduction of a new Royal Munchkin today. There’s no edible crown, just pink, blue and white sprinkles.

Meanwhile, sister chain Baskin-Robbins is stoking global elation over the arrival of the U.K.’s future king with the introduction of a Baby Shower Cake. The treats “help people celebrate the birth of the Duke and Duchess of Cambridge’s new son,” crows parent company Dunkin’ Brands. And if they generate a few extra bucks for franchisees, all hail the king.

New York City’s Tea and Sympathy played off its British theme by breaking out the bubbly after the birth was announced. Patrons no doubt drank the hooch with a bent pinkie while muttering Brish-isms like, “I say, old chap…”

Wendy’s new burger is no piece of cake
Adding the new Pretzel Bacon Cheeseburger wasn’t without its back-of-the-house challenges for Wendy’s, CEO Emil Brolick revealed to investors in a conference call today.

“When you look at our operating system, I will tell you it's not easy handling things like Pretzel Bacon Cheeseburgers,” he explained. To build it, kitchen staffers use “a very, very high quality natural cheddar cheese.” Brolick didn’t say it, but cheddar is usually brittle. And because of the quality, Wendy’s version isn’t at the bottom of the pricing range.

Ditto, presumably, for the smoky honey mustard that the chain uses just for that sandwich. And the bacon “is extremely hard to find out there, it's a center-cut bacon,” stressed Brolick.

The result, he said, is one of Wendy’s most anticipated new products. “I would say you'd be hard-pressed to find this other than going to a quick casual restaurant,” Brolick noted. Yet, he observed several times, the price is more in the range of a traditional quick-service restaurant.

Friday, July 19, 2013

Paying tribute to restaurant marketing's oldest timer

People of a certain vintage tend to harbor special appreciation for star performers of an advanced age. I, of course, wouldn’t know about that, but I bet the coots in your business are all but jumping out of their spats after seeing the Methuselah of restaurant marketing make another comeback. Yes, McDonald’s Monopoly sweepstakes has been re-introduced this week for its 26st annual appearance. 
In promo years, that’s the equivalent of George Burns’ lifetime—added onto Jack LaLanne’s (youngsters: Ask your elders who those whippersnappers were.)
But it’s not sheer longevity, and undisputed effectiveness, that makes the Monopoly sweepstakes worthy of its own wing in the Hall of Fame. It survived a scandal some 13 years ago that makes Chicago politicians seem like altar boys. The head of security for the game’s third-party administrator was caught diverting big-dollar pieces to acquaintances.  Yet Monopoly shook off the stigma and quickly re-emerged as a consumer favorite.
And what a favorite. Competitors routinely curse the promo, and even McDonald’s franchisees cease their griping to praise the franchisor’s program. It drives traffic and, equally important today, fosters the sort of internet and social media buzz that translates into additional business.
Consider the scale of the game. According to the websiteBusinessInsider, there were 602.5 billion game pieces in play. Keep in mind that there are roughly 700 billion consumers (i.e., people) on the whole earth.
Indeed, you have to wonder: What’s better known today, the Monopoly sweepstakes, or the board game that provided the theme?
It’s a tribute to McDonald’s, and a reflection of its awesome marketing might, that the sweepstakes is still going strong. For those of us who are looking more and more like the little banker guy on the game pieces, it’s especially awe-inspiring.

Wednesday, July 17, 2013

What were they thinking?

This has been a week of jaw-dropping restaurant blunders. Consider, for instance, Wendy’s inadvertent lapse into pimp-speak during an otherwise routine promotion.

Sure, the mainstream fast-food chains have been going to extremes lately to snag customers, but the deal touted by Wendy’s seemed really out there. Buy any product, a coupon promised, and the chain would provide a hot little redhead, completely free.

To be fair: The coupon actually read, SMALL HOT ORIGINAL REDHEAD, the key there being the capital “R” in Redhead. That’s the shortened name of Wendy’s proprietary coffee brand, Redhead Roasters. Still, it’s puzzling that no one noted the suggestive wording.

It’s unlikely that McDonald’s will be snickering about its archrival’s misfire, given the doh! move it logged almost simultaneously. Big Mac ended up with Egg McMuffin on its face when The Wall Street Journal intercepted a worksheet the chain had distributed to its hourly workers as a financial planning guide. The form was intended to help the crewmembers manage their dollars. Not dissimilar to a P&L, it started with a space at the top where the user-employee would list his or her monthly wages. So far, so good.

But by Line 2, McDonald’s looked insensitive. That was the space provided for the employee to list the income from his or her second job. The chain was all but conceding that a job at the Golden Arches wouldn’t be enough to live.

It was downhill from there. As examples of expenses, McDonald’s filled in such figures on the form as mortgage or rent payments of $600, and healthcare premiums of $20--or less than the employee contribution for McDonald’s own plan, according to the WSJ. The report noted that the figures provided were unrealistic and made McD’s seem out of touch with its employees’ financial struggles.

But that PR stumble is nothing compared with the dunderheaded move of an Italian independent in Winter Park, Fla.  Unfortunately, it’s the whole restaurant industry that looks bad. The place, Barducci’s, fired its whole staff—by text. The communication came on the 4th of July, and focused on the restaurant’s immediate closing. The 12 staffers had to infer that they were out of work. The rest of the world heard about the cold-hearted in a flurry of news reports this week.

A quick cut-off by one North Carolina restaurant also worked against the industry as a whole. According to local coverage that was soon picked up by the national media, a Hops Grill in Charlotte surprised its customers by telling them mid-meal that the place had to close. The guests were then given the check and a take-out box.

Just to make the experience a little more memorable, the plug was pulled after cops swarmed into the place at the request of management. Apparently there was concern that customers might react badly to getting the heave-ho mid-bite.

Hey, everyone acts on a misconceived notion at one time or another. This just seems to be the whole industry’s week.

Monday, July 1, 2013

The really big news

Forget Edward Snowden, the Syrian revolution, Egypt’s echo-revolution, or who’ll win “America’s Got Talent.” The big news last week for anyone in this business has to be the closing of Brennan’s.

There are few fine-dining landmarks that can rival it in fame and distinction. Start with its role as a definer of New Orleans as a world-class dining destination. Add its distinction as a leading proponent of Creole cooking. Thicken the roux with a slew of distinctions, like developing Bananas Foster, or serving a bread pudding that you could build a vacation around. It’s reinvigorated itself more times than David Bowie, and must consistently rank as one of New Orleans’ top tourist attractions.

Yet last week the sheriff’s office evicted management and foreclosed on the place. Details are murky, in the style of any New Orleans scandal, but it appears squabbling among the Brennans currently in charge cost the 67-year-old place its lease, then its economic viability. Staffers who showed up for work on Friday learned they no longer held some of the culinary city’s most coveted service jobs.

Curiously, a few local news reports say the place has already been scarfed up with another Brennan from a different branch of the family. If those reports are true, New Orleans is fortunate indeed. Ralph Brennan has his aunt Ella’s golden touch with restaurants, but a demeanor that seems to dampen political infighting. It must be the accountant in him. He knows how to create and run good restaurants, and his immaculate white hat can only help in restoring luster to the Brennan’s name.

Still, the news was almost too bad to be true.  The sun has set on icons like Locke-Ober in Boston, Tavern on the Green in New York, and Chasen’s in West Hollywood. This week's casualty is a legend on another scale.