If you still think chain restaurants are a career path for losers who can’t make it in a legitimate field, here’s a news flash: The world’s not flat, you can teach old dogs new tricks, and some white people have exceptional rhythm. Not only is the business the chosen route to success for people of considerable talent, but it’s an industry that few people abandon once they’ve tasted its rewards.
Exhibit A: Claire Babrowski, until recently the exception that proved the rule. When she was passed over for the top jobs at McDonald’s, she baled for retailing, becoming acting CEO and COO of Radio Shack (and reporting, ironically, to one of the few restaurant-chain executives who left for good, one-time Arby’s and Shoney’s chief Len Roberts).
I interviewed her when she headed operations for McDonald’s at a critical point for the chain. It was clear that she was a person of exceptional ability, vision and leadership. I figured I was meeting the next CEO of the Golden Arches or perhaps a cagey competitor.
Then McDonald's secret sauce soured, some of its bolder initiatives were questioned, and the company adopted a back-to-basics mindset. Futuristic notions like Made For You, a costly kitchen re-do for delivering customized orders in a flash, was suddenly downplayed.
Insiders reported that Babrowski was frustrated and ready to test herself elsewhere. After a lull, she resurfaced at Radio Shack, selling answering machines instead of burgers. She later moved to Toys “R” Us, where she served as COO until she was fired in May 2010.
Now she's once again in the restaurant business, albeit as a director rather than an executive. She was just named a member of Quiznos' new board, a role that should be familiar to her, given that she served once as a director for Chipotle Mexican Grill.
Her new affiliation, Quiznos, was teetering on the brink of bankruptcy around the beginning of the year. Now it boasts an all-star board studded with such industry elders as Doug Benham, a key figure in Arby's best years, and Kip Knight, a one-time marketing leader for KFC and Taco Bell. Apparently they can’t stay away from the business, either.
Babrowski is the latest example of what was once a rare breed: A expatriate from McDonald's. Lately that group has been growing. Former president Mike Roberts has a new fast-casual concept called LYFE Kitchen. One-time U.S. CEO Ed Rensi has a winner upstart in the gourmet burger concept Tom & Eddie's (hear him in a few weeks at the Restaurant Leadership Conference). Kevin Reddy runs Noodles & Co.
And then there's Jack Greenberg, the onetime corporate CEO who was at the helm when business went awry for McDonald's in the mid-2000s. He had made the mistake of accepting the bleak view that domestic growth prospects for the brand were dimming. He led a diversification effort that saw McDonald's buy into such concepts as Boston Market, Fazoli's, Chipotle, Pret a Manger, and Aroma, a coffee specialist.
Those brands were gone almost as soon as Greenberg retired.
But now he, too, is back in the business, though in a distant capacity. Chicago mayor Rahm Emanuel has nominated Greenberg to head the operation that runs the Windy City's McCormick Place, home of the National Restaurant Association's annual mega-convention.
It's merely a big toe stuck back in the pool. But who knows what could happen? One of the NRA Show's benefits is the networking opportunities it affords.
Showing posts with label KFC. Show all posts
Showing posts with label KFC. Show all posts
Thursday, February 23, 2012
Tuesday, October 25, 2011
Only yawning over new products is coming from the R&D team
Here’s a link that restaurant chains might want to check out for the well being of their menu development staffs. It’s an eBay listing for army cots. Clearly R&D teams have little time to swap chef’s whites for PJs when they’re cooking up new customer draws at the current pace.
Oh, and don’t forget to visit this site, too. It’s an online pharmacy that extends a price break on big tranquilizer orders. The products coming from the big brands’ test kitchens have typically been make-or-break products. Did the team come up with a new menu milestone, or will their handiwork be remembered as the new New Coke?
Burger chains are changing their burgers, pizza chains are reformulating their pizza, coffee chains are re-percolating their core coffee line, Mexican chains are rethinking what they put in a tortilla.
Think about it: With McDonald’s about to add a new chicken finger food called McBites, and Burger King introducing the Chef’s Choice this week as its new premium burger, almost all of the major fast-food chains are fiddling with their menu signatures.
What’s more, the alterations are introduced with direct or implied criticisms of the versions they replaced. Domino’s has made the most noise on that front, all but asking customers, “How could you have eaten what we formerly sold you?”
But Wendy’s isn’t much more discrete in its push of new French fries and burgers. Ditto with KFC and Kentucky Grilled Chicken. The only one showing subtlety is Taco Bell, which is quietly taking some salt out of its signatures.
McDonald’s hasn’t revealed what sort of noise it’ll make about McBites, a chicken version of popcorn shrimp (essentially deep-fried pieces of chicken meat, like the popcorn selections that have long been on the menus of KFC and Popeyes.) You can bet it won’t knock Chicken McNuggets or Chicken Selects in the introduction, but you have to wonder if customers will nonetheless regard McBites as an obvious alternative to McNuggets.
We’ll find out when McDonald’s rolls the new product next year.
The remake of fast-food signatures won’t end there. As RestaurantRealityCheck noted last week, Burger King is trying a new, thicker fry. Its stated goal of appealing to more women and children portends even more changes in products.
Might there even be some riffs on the Whopper?
This isn't the first time that such a thing has happened. In the mid-1980s, BK indeed changed the specs on its holiest of signatures, revamping the size of the Whopper's patty.
McDonald's tried to rejigger its bigger burgers so they could be garnished with lettuce and a tomato slice that wouldn't be rendered unpleasant by the heat of the patty they topped. Later, KFC introduced a bone-in roasted chicken, and Taco Bell tried reduced-calorie versions of its main items.
They all joined the Edsel in the annals of product failures.
But there are different dynamics--and learnings from those misfires--in play this time. Technomic noted in releasing some research yesterday that the fast-casual sector is influencing restaurants of all stripes. No where is that impact more obvious than in the traditional quick-service market, which has the most to lose from fast-casual's rise. Is it really a surprise that former Wendy's CEO Roland Smith publicly compared the chain's new burger line to what's available at Five Guys?
Talk amongst yourselves about it. But try to keep the noise down. The R&D teams need to catch up on their sleep.
Oh, and don’t forget to visit this site, too. It’s an online pharmacy that extends a price break on big tranquilizer orders. The products coming from the big brands’ test kitchens have typically been make-or-break products. Did the team come up with a new menu milestone, or will their handiwork be remembered as the new New Coke?
Burger chains are changing their burgers, pizza chains are reformulating their pizza, coffee chains are re-percolating their core coffee line, Mexican chains are rethinking what they put in a tortilla.
Think about it: With McDonald’s about to add a new chicken finger food called McBites, and Burger King introducing the Chef’s Choice this week as its new premium burger, almost all of the major fast-food chains are fiddling with their menu signatures.
What’s more, the alterations are introduced with direct or implied criticisms of the versions they replaced. Domino’s has made the most noise on that front, all but asking customers, “How could you have eaten what we formerly sold you?”
But Wendy’s isn’t much more discrete in its push of new French fries and burgers. Ditto with KFC and Kentucky Grilled Chicken. The only one showing subtlety is Taco Bell, which is quietly taking some salt out of its signatures.
McDonald’s hasn’t revealed what sort of noise it’ll make about McBites, a chicken version of popcorn shrimp (essentially deep-fried pieces of chicken meat, like the popcorn selections that have long been on the menus of KFC and Popeyes.) You can bet it won’t knock Chicken McNuggets or Chicken Selects in the introduction, but you have to wonder if customers will nonetheless regard McBites as an obvious alternative to McNuggets.
We’ll find out when McDonald’s rolls the new product next year.
The remake of fast-food signatures won’t end there. As RestaurantRealityCheck noted last week, Burger King is trying a new, thicker fry. Its stated goal of appealing to more women and children portends even more changes in products.
Might there even be some riffs on the Whopper?
This isn't the first time that such a thing has happened. In the mid-1980s, BK indeed changed the specs on its holiest of signatures, revamping the size of the Whopper's patty.
McDonald's tried to rejigger its bigger burgers so they could be garnished with lettuce and a tomato slice that wouldn't be rendered unpleasant by the heat of the patty they topped. Later, KFC introduced a bone-in roasted chicken, and Taco Bell tried reduced-calorie versions of its main items.
They all joined the Edsel in the annals of product failures.
But there are different dynamics--and learnings from those misfires--in play this time. Technomic noted in releasing some research yesterday that the fast-casual sector is influencing restaurants of all stripes. No where is that impact more obvious than in the traditional quick-service market, which has the most to lose from fast-casual's rise. Is it really a surprise that former Wendy's CEO Roland Smith publicly compared the chain's new burger line to what's available at Five Guys?
Talk amongst yourselves about it. But try to keep the noise down. The R&D teams need to catch up on their sleep.
Friday, October 7, 2011
A-ha's that might've slipped past you
You can’t miss a wave that’s reshaping the restaurant business. Harder to spot are the ripples that could swell into powerful forces. Consider these recent developments, for instance:
‘Menu disclosure’ is redefined. The term was once synonymous with posting calorie counts and other nutritional metrics so consumers could make an informed choice. Now we’re seeing a secondary designation.
Amid all the hoopla over the opening of Chipotle’s ShopHouse Southeast Asian Kitchen was a little-noticed detail brought to light by the Washington Post: Not everything on the menu was what it purported to be. Two of the sauces for vegetarian were actually made with fish stock, a huge no-no to the more orthodox non-flesh-eaters.
As the Post subsequently reported, ShopHouse quickly rectified the situation by adding an asterisk to the menu listings, alerting customers that the sauces are non-vegetarian.
It must’ve been déjà vu all over again for the concept’s parent. About a week beforehand, a tweeter with a large following voiced 140 characters’ worth of indignation that Chipotle’s pinto beans were flavored with bacon. Co-CEO Steve Ells called the tweeter (he’s an editor of Maxim, the breasts-and-beer magazine), apologized, and explained that the menu description had been corrected.
Meanwhile, Wendy’s drew fire because of its switch to buttered hamburger buns for the new Dave’s Hot ‘n Juicy line. Websites pointed out that the butter could be a hazard to consumers who are allergic to dairy products, and faulted the chain for not flagging the newfound danger more clearly on its website.
Franchisors could be seriously ding’d by the tax man. It slipped past almost unnoticed, but KFC lost a landmark court decision this week that should worry every franchisor. The U.S. Supreme Court rebuffed an attempt by the Yum! Brans holding to keep Iowa from assessing it for state income taxes.
The franchisor pointed out that it doesn’t operate a single restaurant in the state; all the units there are franchise stores. It doesn’t even have a single employee.
But the Supreme Court rejected the appeal. KFC will have to pay the $250,000 that Iowa says it’s due in income taxes on the franchise royalties and fees that were channeled to chain headquarters in Kentucky.
Two days, two bankruptcies of Sun Capital holdings. Are economic realities catching up to the private-equity raiders?
No PE investor gobbled up as many restaurant brands before and during the Great Recession as Sun, whose portfolio extends from Captain D’s to Bar Louie. The acquisitions included stakes in Friendly’s and Real Mex, parent of the Chevys, El Torito and Acapulco chains, both of which are now being run under the scrutiny of a bankruptcy court. Sun is undoubtedly the owner of more concepts than any other entity in the business, and is likely one of the bigger operator-franchisors as well.
It’s become an industry parlor game to speculate about what Sun will do with those holdings. An IPO for a select chain? Or for several, packaged together? How about a sale to other PE companies? Or to a strategic buyer? Maybe some will be crunched up and sold piecemeal for their locations, the way an auto is sold for parts.
It’s safe to say that Sun didn’t buy anything with a hope of seeing it go bankrupt. What does that portend a company with that much vulnerability to a restaurant downturn on its books?
Looks as if the parlor game has just been updated.
‘Menu disclosure’ is redefined. The term was once synonymous with posting calorie counts and other nutritional metrics so consumers could make an informed choice. Now we’re seeing a secondary designation.
Amid all the hoopla over the opening of Chipotle’s ShopHouse Southeast Asian Kitchen was a little-noticed detail brought to light by the Washington Post: Not everything on the menu was what it purported to be. Two of the sauces for vegetarian were actually made with fish stock, a huge no-no to the more orthodox non-flesh-eaters.
As the Post subsequently reported, ShopHouse quickly rectified the situation by adding an asterisk to the menu listings, alerting customers that the sauces are non-vegetarian.
It must’ve been déjà vu all over again for the concept’s parent. About a week beforehand, a tweeter with a large following voiced 140 characters’ worth of indignation that Chipotle’s pinto beans were flavored with bacon. Co-CEO Steve Ells called the tweeter (he’s an editor of Maxim, the breasts-and-beer magazine), apologized, and explained that the menu description had been corrected.
Meanwhile, Wendy’s drew fire because of its switch to buttered hamburger buns for the new Dave’s Hot ‘n Juicy line. Websites pointed out that the butter could be a hazard to consumers who are allergic to dairy products, and faulted the chain for not flagging the newfound danger more clearly on its website.
Franchisors could be seriously ding’d by the tax man. It slipped past almost unnoticed, but KFC lost a landmark court decision this week that should worry every franchisor. The U.S. Supreme Court rebuffed an attempt by the Yum! Brans holding to keep Iowa from assessing it for state income taxes.
The franchisor pointed out that it doesn’t operate a single restaurant in the state; all the units there are franchise stores. It doesn’t even have a single employee.
But the Supreme Court rejected the appeal. KFC will have to pay the $250,000 that Iowa says it’s due in income taxes on the franchise royalties and fees that were channeled to chain headquarters in Kentucky.
Two days, two bankruptcies of Sun Capital holdings. Are economic realities catching up to the private-equity raiders?
No PE investor gobbled up as many restaurant brands before and during the Great Recession as Sun, whose portfolio extends from Captain D’s to Bar Louie. The acquisitions included stakes in Friendly’s and Real Mex, parent of the Chevys, El Torito and Acapulco chains, both of which are now being run under the scrutiny of a bankruptcy court. Sun is undoubtedly the owner of more concepts than any other entity in the business, and is likely one of the bigger operator-franchisors as well.
It’s become an industry parlor game to speculate about what Sun will do with those holdings. An IPO for a select chain? Or for several, packaged together? How about a sale to other PE companies? Or to a strategic buyer? Maybe some will be crunched up and sold piecemeal for their locations, the way an auto is sold for parts.
It’s safe to say that Sun didn’t buy anything with a hope of seeing it go bankrupt. What does that portend a company with that much vulnerability to a restaurant downturn on its books?
Looks as if the parlor game has just been updated.
Friday, July 15, 2011
Ruffling feathers about KFC
It’s a canon of the chain-restaurant world that you speak of a concept’s founder with a reverence usually reserved for saints and Mickey Mantle. The only party held in higher esteem might be franchisees, typically lauded as the embodiment of entrepreneurship and operational know-how. They’re best mentioned with a bowed head.
So let us celebrate the honesty that Yum Brands CEO David Novak bravely showed yesterday in uttering what would normally be stigmatized as heresy on the grandest scale. He dared to speak candidly about the DNA of KFC.
That meant—steel yourself—voicing what could be construed as a criticism of Col. Harland Sanders.
Novak had been asked by financial analysts for “more color” (finance-speak for “the full story”) on the glaring discrepancy between KFC’s performances at home and abroad. Why was it such a favored son in China but a problem child here in the States? Couldn’t some of the best practices from overseas be programmed into domestic operations? After all, the questioner noted, that’s what McDonald’s does.
“I think there's just been a lot more innovation and breadth built into the menu in KFC in most countries outside the United States,” responded Novak. “I think Colonel Sanders kind of set the U.S. up with a heritage of small-box [stores serving] chicken on the bone, stay focused on your knitting. And so I do think that it's a little harder for us to transform the brand.”
While analysts were no doubt clutching their chests and donning garlic necklaces to ward off the bad juju, Novak went further: “And frankly, we don't have a franchise system that is as enlightened as our franchisees are outside the United States as well. So that's something that we have to deal with as well.”
Relations between KFC and its franchisees have likely served as inspiration over the years to Hatfield and McCoy kin. So it was doubly bold of Novak to be candid and deliver the transparency that investors deserve.
He’s probably in an office right now, holding his head as he screens calls and e-mails from irate parties. But he did the right thing.
As he noted during yesterday’s conference call, One of the things I take a lot of pride in on our company is we don't really like storytelling.
“Stories equal excuses.”
You can read the account yourself in the transcript posted by SeekingAlpha.com.
So let us celebrate the honesty that Yum Brands CEO David Novak bravely showed yesterday in uttering what would normally be stigmatized as heresy on the grandest scale. He dared to speak candidly about the DNA of KFC.
That meant—steel yourself—voicing what could be construed as a criticism of Col. Harland Sanders.
Novak had been asked by financial analysts for “more color” (finance-speak for “the full story”) on the glaring discrepancy between KFC’s performances at home and abroad. Why was it such a favored son in China but a problem child here in the States? Couldn’t some of the best practices from overseas be programmed into domestic operations? After all, the questioner noted, that’s what McDonald’s does.
“I think there's just been a lot more innovation and breadth built into the menu in KFC in most countries outside the United States,” responded Novak. “I think Colonel Sanders kind of set the U.S. up with a heritage of small-box [stores serving] chicken on the bone, stay focused on your knitting. And so I do think that it's a little harder for us to transform the brand.”
While analysts were no doubt clutching their chests and donning garlic necklaces to ward off the bad juju, Novak went further: “And frankly, we don't have a franchise system that is as enlightened as our franchisees are outside the United States as well. So that's something that we have to deal with as well.”
Relations between KFC and its franchisees have likely served as inspiration over the years to Hatfield and McCoy kin. So it was doubly bold of Novak to be candid and deliver the transparency that investors deserve.
He’s probably in an office right now, holding his head as he screens calls and e-mails from irate parties. But he did the right thing.
As he noted during yesterday’s conference call, One of the things I take a lot of pride in on our company is we don't really like storytelling.
“Stories equal excuses.”
You can read the account yourself in the transcript posted by SeekingAlpha.com.
Friday, May 13, 2011
Restaurant publicity stunts are alive, but not well
A pink ass seldom sells restaurant meals, or at least not outside of certain neighborhoods in New York and San Francisco. But that didn’t divert the marketing ploy from express-line entry into the Restaurant Publicity Stunts Hall of Fame, which might have to open a whole new wing after recent weeks.
Indeed, we may be in a Golden Age of restaurant stunts, a reflection of the need to offset shrinking (or non-existent) marketing budgets with outrageous actions. That factor is changing the very nature of stunts. No longer are they single events, over and done in a flash.
Consider, for instance, how a newcomer to the better-burger market tried to set itself apart from the spatula-wielding pack. Twenty-three-year-old Lakita Evans decided to call her Waco, Texas, outlet Fat Ho. Its specialties include a Sloppy Ho, a.k.a. a brisket sandwich, and a Supa Dupa Fly Ho.
Evans hit the mark. Papers across the nation have reported on her venture, invariably focusing on the name and her age rather than the quality of the food and service.
Many of the reports noted that she was opening a pimp’s walk away from the Gospel Café, a ploy practitioner in its own right.
Neither should (or would) be confused with Buns, a burger joint in Chapel Hill, N.C.
And don’t expect to find More Than a Mouthful Burgers, the signature line of Hooters, a pioneer of the suggestive-name approach.
But the all-time winner of the double-entendre approach has to be Pink Taco, which, some of Reality Check’s readers in stained raincoats have informed me, is slang for female genitalia.
But the gynecology-inspired concept didn’t stop there. Last week, in honor of Cinco de Mayo, the Los Angeles casual restaurant decided to post something decidedly Mexican outside its tony Century City location. It took a donkey, or what patrons of the Gospel Café might know from their bible readings to be known also as an ass, and painted it pink.
The animal was staked outside the mall restaurant, “Pink Taco” written on its flank in what looked like a finger-painting endeavor.
The restaurant got attention, for sure. But unfortunately some of it came from animal-rights advocates, who moved in like vice cops staking out Charlie Sheen’s house. The restaurant agreed never to use a live animal in its promotion again.
But take heart: There’s still a respect evident among restaurant stunt-pullers for the classics. KFC, for instance, used the timeless stunt setting of a skyscraper’s upper floors to call attention to its new $5 bundled lunch meals. At noon today, someone dressed as Col. Sanders will rappel down 38 floors of a Chicago building to deliver lunches to window washers dangling outside the 40th floor.
Reports that the chain considered a flag-pole sitting contest could not be confirmed.
Even more conventional is what Arby’s is doing to introduce its new Grilled Chicken & Pecan Salad Sandwich and wrap—ironically, like KFC’s new lunch deal, a product intended to draw customers away from Subway.
The chain will give away free sandwiches and wraps to customers who buy a 22-oz. soft drink anytime before May 23. Patrons are then invited to vote for which they like better, the Arby’s sandwich or Subway’s Orchard Chicken Salad sub.
There’s been no response from Subway. Maybe it’s thinking up its own stunt.
Indeed, we may be in a Golden Age of restaurant stunts, a reflection of the need to offset shrinking (or non-existent) marketing budgets with outrageous actions. That factor is changing the very nature of stunts. No longer are they single events, over and done in a flash.
Consider, for instance, how a newcomer to the better-burger market tried to set itself apart from the spatula-wielding pack. Twenty-three-year-old Lakita Evans decided to call her Waco, Texas, outlet Fat Ho. Its specialties include a Sloppy Ho, a.k.a. a brisket sandwich, and a Supa Dupa Fly Ho.
Evans hit the mark. Papers across the nation have reported on her venture, invariably focusing on the name and her age rather than the quality of the food and service.
Many of the reports noted that she was opening a pimp’s walk away from the Gospel Café, a ploy practitioner in its own right.
Neither should (or would) be confused with Buns, a burger joint in Chapel Hill, N.C.
And don’t expect to find More Than a Mouthful Burgers, the signature line of Hooters, a pioneer of the suggestive-name approach.
But the all-time winner of the double-entendre approach has to be Pink Taco, which, some of Reality Check’s readers in stained raincoats have informed me, is slang for female genitalia.
But the gynecology-inspired concept didn’t stop there. Last week, in honor of Cinco de Mayo, the Los Angeles casual restaurant decided to post something decidedly Mexican outside its tony Century City location. It took a donkey, or what patrons of the Gospel Café might know from their bible readings to be known also as an ass, and painted it pink.
The animal was staked outside the mall restaurant, “Pink Taco” written on its flank in what looked like a finger-painting endeavor.
The restaurant got attention, for sure. But unfortunately some of it came from animal-rights advocates, who moved in like vice cops staking out Charlie Sheen’s house. The restaurant agreed never to use a live animal in its promotion again.
But take heart: There’s still a respect evident among restaurant stunt-pullers for the classics. KFC, for instance, used the timeless stunt setting of a skyscraper’s upper floors to call attention to its new $5 bundled lunch meals. At noon today, someone dressed as Col. Sanders will rappel down 38 floors of a Chicago building to deliver lunches to window washers dangling outside the 40th floor.
Reports that the chain considered a flag-pole sitting contest could not be confirmed.
Even more conventional is what Arby’s is doing to introduce its new Grilled Chicken & Pecan Salad Sandwich and wrap—ironically, like KFC’s new lunch deal, a product intended to draw customers away from Subway.
The chain will give away free sandwiches and wraps to customers who buy a 22-oz. soft drink anytime before May 23. Patrons are then invited to vote for which they like better, the Arby’s sandwich or Subway’s Orchard Chicken Salad sub.
There’s been no response from Subway. Maybe it’s thinking up its own stunt.
Wednesday, May 11, 2011
The publicity event is alive, but not necessarily well
A pink ass seldom sells restaurant meals, or at least not outside of certain neighborhoods in New York and San Francisco. But that didn’t divert the marketing ploy from express-line entry into the Restaurant Publicity Stunts Hall of Fame, which might have to open a whole new wing after recent weeks.
Indeed, we may be in a Golden Age of restaurant stunts, a reflection of the need to offset shrinking (or non-existent) marketing budgets with outrageous actions. That factor is changing the very nature of stunts. No longer are they single events, over and done in a flash.
Consider, for instance, how a newcomer to the better-burger market tried to set itself apart from the spatula-wielding pack. Twenty-three-year-old Lakita Evans decided to call her Waco, Texas, outlet Fat Ho. Its specialties include a Sloppy Ho, a.k.a. a brisket sandwich, and a Supa Dupa Fly Ho.
Evans hit the mark. Papers across the nation have reported on her venture, invariably focusing on the name and her age rather than the quality of the food and service.
Many of the reports noted that she was opening a pimp’s walk away from the Gospel Café, a ploy practitioner in its own right.
Neither should (or would) be confused with Buns, a burger joint in Chapel Hill, N.C.
And don’t expect to find More Than a Mouthful Burgers, the signature line of Hooters, a pioneer of the suggestive-name approach.
But the all-time winner of the double-entendre approach has to be Pink Taco, which, some of Reality Check’s readers in stained raincoats have informed me, is slang for female genitalia.
But the gynecology-inspired concept didn’t stop there. Last week, in honor of Cinco de Mayo, the Los Angeles casual restaurant decided to post something decidedly Mexican outside its tony Century City location. It took a donkey, or what patrons of the Gospel Café might know from their bible readings to be known also as an ass, and painted it pink.
The animal was staked outside the mall restaurant, “Pink Taco” written on its flank in what looked like a finger-painting endeavor.
The restaurant got attention, for sure. But unfortunately some of it came from animal-rights advocates, who moved in like vice cops staking out Charlie Sheen’s house. The restaurant agreed never to use a live animal in its promotion again.
But take heart: There’s still a respect evident among restaurant stunt-pullers for the classics. KFC, for instance, used the timeless stunt setting of a skyscraper’s upper floors to call attention to its new $5 bundled lunch meals. At noon today, someone dressed as Col. Sanders will rappel down 38 floors of a Chicago building to deliver lunches to window washers dangling outside the 40th floor.
Reports that the chain considered a flag-pole sitting contest could not be confirmed.
Even more conventional is what Arby’s is doing to introduce its new Grilled Chicken & Pecan Salad Sandwich and wrap—ironically, like KFC’s new lunch deal, a product intended to draw customers away from Subway.
The chain will give away free sandwiches and wraps to customers who buy a 22-oz. soft drink anytime before May 23. Patrons are then invited to vote for which they like better, the Arby’s sandwich or Subway’s Orchard Chicken Salad sub.
There’s been no response from Subway. Maybe it’s thinking up its own stunt.
Indeed, we may be in a Golden Age of restaurant stunts, a reflection of the need to offset shrinking (or non-existent) marketing budgets with outrageous actions. That factor is changing the very nature of stunts. No longer are they single events, over and done in a flash.
Consider, for instance, how a newcomer to the better-burger market tried to set itself apart from the spatula-wielding pack. Twenty-three-year-old Lakita Evans decided to call her Waco, Texas, outlet Fat Ho. Its specialties include a Sloppy Ho, a.k.a. a brisket sandwich, and a Supa Dupa Fly Ho.
Evans hit the mark. Papers across the nation have reported on her venture, invariably focusing on the name and her age rather than the quality of the food and service.
Many of the reports noted that she was opening a pimp’s walk away from the Gospel Café, a ploy practitioner in its own right.
Neither should (or would) be confused with Buns, a burger joint in Chapel Hill, N.C.
And don’t expect to find More Than a Mouthful Burgers, the signature line of Hooters, a pioneer of the suggestive-name approach.
But the all-time winner of the double-entendre approach has to be Pink Taco, which, some of Reality Check’s readers in stained raincoats have informed me, is slang for female genitalia.
But the gynecology-inspired concept didn’t stop there. Last week, in honor of Cinco de Mayo, the Los Angeles casual restaurant decided to post something decidedly Mexican outside its tony Century City location. It took a donkey, or what patrons of the Gospel Café might know from their bible readings to be known also as an ass, and painted it pink.
The animal was staked outside the mall restaurant, “Pink Taco” written on its flank in what looked like a finger-painting endeavor.
The restaurant got attention, for sure. But unfortunately some of it came from animal-rights advocates, who moved in like vice cops staking out Charlie Sheen’s house. The restaurant agreed never to use a live animal in its promotion again.
But take heart: There’s still a respect evident among restaurant stunt-pullers for the classics. KFC, for instance, used the timeless stunt setting of a skyscraper’s upper floors to call attention to its new $5 bundled lunch meals. At noon today, someone dressed as Col. Sanders will rappel down 38 floors of a Chicago building to deliver lunches to window washers dangling outside the 40th floor.
Reports that the chain considered a flag-pole sitting contest could not be confirmed.
Even more conventional is what Arby’s is doing to introduce its new Grilled Chicken & Pecan Salad Sandwich and wrap—ironically, like KFC’s new lunch deal, a product intended to draw customers away from Subway.
The chain will give away free sandwiches and wraps to customers who buy a 22-oz. soft drink anytime before May 23. Patrons are then invited to vote for which they like better, the Arby’s sandwich or Subway’s Orchard Chicken Salad sub.
There’s been no response from Subway. Maybe it’s thinking up its own stunt.
Friday, December 17, 2010
Overlooked news of the day
Here are some stories you might’ve missed on what’s proving to be a big news day:
NOW, NOW: Hooters can't say it's adult entertainment and then feed kids
The National Organization of Women reportedly petitioned authorities in the San Francisco area to shut down local Hooters restaurants because they were licensed as hootchie-koochie places but actually fed kids along with the drooling lechers in raincoats. Actually, the lawyers might’ve used different language, but that was the essential contention of the legal action. Hooters doesn’t deny that it’s become more of a family place, acknowledging that 10 percent of its parties are families.
KFC lightening up?
KFC units in the United Kingdom will switch to a healthier frying oil next year, according to a report yesterday from Marketing Week. The online story didn’t say if the change would be chainwide or just an undertaking by British stores. A switch like that for KFC would be like Burger King tinkering with its ground beef mix or McDonald’s fiddling with its fries.
But the Colonel didn't like mood lighting!
The same story reported that KFC is testing a new and surprisingly upscale design across the pond. It sounds like KFC’s take on the trend of quick-service giants making their dining rooms more comfortable and inviting for young people, with amenities like entertainment and more bar-like features. In KFC’s instance, that means a room with red glass walls and red lighting. There again, Marketing Week didn’t say if the new prototype would be peculiar to the U.K. or something that could appear here in the United States.
The King's demand were a royal pain, bankrupt zee says
One of Burger King’s larger franchisees filed for bankruptcy protection, contending that it was bled dry by the capital outlays required by the brand’s former owner. Duke and King reportedly operated 92 stores in the Midwest. It also hissed at the franchisor for blocking the purchase of 66 stores in 2007, arguing that those units were healthier and could’ve provided the cash flow to rejuvenate units elsewhere. The situation underscores that one of the bigger challenges for BK’s new owner is winning the support of the franchise community.
Luby's nickel and dime ops
The most surprising tidbit in Luby’s quarterly financial report is the $153,000 in revenues ascribed to vending operations. Who knew it had any? They must’ve been picked up in the Fuddruckers and KooKooRoo acquisition because there’s no vending revenue listed for the first quarter of the prior year.
Buyer's remorse?
The revelation followed the little-noticed news that a court has directed Luby’s to buy nine Fuddruckers franchises, as the cafeteria operator agreed when it bought Fudd’s parent, Magic Brand, back in June. Luby’s had balked at that part of the deal, contending that it hadn’t been given an accurate account of the franchises’ financial health.
NOW, NOW: Hooters can't say it's adult entertainment and then feed kids
The National Organization of Women reportedly petitioned authorities in the San Francisco area to shut down local Hooters restaurants because they were licensed as hootchie-koochie places but actually fed kids along with the drooling lechers in raincoats. Actually, the lawyers might’ve used different language, but that was the essential contention of the legal action. Hooters doesn’t deny that it’s become more of a family place, acknowledging that 10 percent of its parties are families.
KFC lightening up?
KFC units in the United Kingdom will switch to a healthier frying oil next year, according to a report yesterday from Marketing Week. The online story didn’t say if the change would be chainwide or just an undertaking by British stores. A switch like that for KFC would be like Burger King tinkering with its ground beef mix or McDonald’s fiddling with its fries.
But the Colonel didn't like mood lighting!
The same story reported that KFC is testing a new and surprisingly upscale design across the pond. It sounds like KFC’s take on the trend of quick-service giants making their dining rooms more comfortable and inviting for young people, with amenities like entertainment and more bar-like features. In KFC’s instance, that means a room with red glass walls and red lighting. There again, Marketing Week didn’t say if the new prototype would be peculiar to the U.K. or something that could appear here in the United States.
The King's demand were a royal pain, bankrupt zee says
One of Burger King’s larger franchisees filed for bankruptcy protection, contending that it was bled dry by the capital outlays required by the brand’s former owner. Duke and King reportedly operated 92 stores in the Midwest. It also hissed at the franchisor for blocking the purchase of 66 stores in 2007, arguing that those units were healthier and could’ve provided the cash flow to rejuvenate units elsewhere. The situation underscores that one of the bigger challenges for BK’s new owner is winning the support of the franchise community.
Luby's nickel and dime ops
The most surprising tidbit in Luby’s quarterly financial report is the $153,000 in revenues ascribed to vending operations. Who knew it had any? They must’ve been picked up in the Fuddruckers and KooKooRoo acquisition because there’s no vending revenue listed for the first quarter of the prior year.
Buyer's remorse?
The revelation followed the little-noticed news that a court has directed Luby’s to buy nine Fuddruckers franchises, as the cafeteria operator agreed when it bought Fudd’s parent, Magic Brand, back in June. Luby’s had balked at that part of the deal, contending that it hadn’t been given an accurate account of the franchises’ financial health.
Friday, February 5, 2010
Some blunt words about Pizza Hut & KFC
It’s not unusual for chain executives to pass long customers’ opinions of their brands. It’s another matter for the officials to relate the slams along with the gushing praise, especially while talking to investors. Yet, in a refreshing burst of candor, that’s exactly what the CEO of Yum! Brands did Thursday during a conference call about the company’s fast-food chains, Taco Bell, KFC and Pizza Hut.
Chief executive David Novak had the harshest words for Pizza Hut’s domestic operations, whose same-store sales fell a head-turning 12% during the last three months of 2009. Oh, sure, the American public loves the chain’s pizza, said Novak, but “the consumer has told us frankly that we are simply too expensive.” He noted that the venerable chain is also focusing on service speed and kitchen operations, so you have to suspect that customers aren’t tossing bouquets in those directions, either.
Novak said the chain is countering its high-price stigma with the “successfully tested” Any Way You Want It promotion, where patrons can get a customized pie for $10.
And how about KFC’s domestic operations? Oy, don’t ask.
“There is no question we have our work cut out for us,” Novak told analysts on the conference call. He ticked off the chain’s three main perception problems in the U.S.: Too much fried food, not enough value, and lousy operations.
The first two objections from customers have been addressed, he said. Indeed, KFC’s new Kentucky Grilled Chicken now accounts for a fourth of all the chicken on the bone sold by the chain.
But operations still have a ways to go, particularly in terms of service speed and not running out of some menu items before the next batch of supplies arrive, Novak acknowledged.
He had nothing but praise for Taco Bell, describing it as one of the company’s sales and profit workhorses, with ample room left to grow in the U.S. market.
The domestic arms of Pizza Hut and KFC, on the other hand, weren’t even addressed when Yum! gathered analysts in New York a few months ago for a close-up look at the company’s inner workings. “we made the conscious decision to not even cover Pizza Hut and KFC U.S. at the December analyst meeting,” he noted.
Then again, those pieces of the business still seem to be held in higher regard than Yum’s two other American fast-food brands, Long John Silver’s and A&W. “[I’m] wondering whether there is a potential to sell those brands or whether we'll see those brands continue to operate here as it relates to generating incremental cash,” Jeffrey Bernstein, the restaurant analyst for Barclays Capital, asked the Yum officials on the call.
“Our goal with Long John Silver and A&W is to make those brands stronger and to build them working with our franchisees,” countered Novak.
Chief executive David Novak had the harshest words for Pizza Hut’s domestic operations, whose same-store sales fell a head-turning 12% during the last three months of 2009. Oh, sure, the American public loves the chain’s pizza, said Novak, but “the consumer has told us frankly that we are simply too expensive.” He noted that the venerable chain is also focusing on service speed and kitchen operations, so you have to suspect that customers aren’t tossing bouquets in those directions, either.
Novak said the chain is countering its high-price stigma with the “successfully tested” Any Way You Want It promotion, where patrons can get a customized pie for $10.
And how about KFC’s domestic operations? Oy, don’t ask.
“There is no question we have our work cut out for us,” Novak told analysts on the conference call. He ticked off the chain’s three main perception problems in the U.S.: Too much fried food, not enough value, and lousy operations.
The first two objections from customers have been addressed, he said. Indeed, KFC’s new Kentucky Grilled Chicken now accounts for a fourth of all the chicken on the bone sold by the chain.
But operations still have a ways to go, particularly in terms of service speed and not running out of some menu items before the next batch of supplies arrive, Novak acknowledged.
He had nothing but praise for Taco Bell, describing it as one of the company’s sales and profit workhorses, with ample room left to grow in the U.S. market.
The domestic arms of Pizza Hut and KFC, on the other hand, weren’t even addressed when Yum! gathered analysts in New York a few months ago for a close-up look at the company’s inner workings. “we made the conscious decision to not even cover Pizza Hut and KFC U.S. at the December analyst meeting,” he noted.
Then again, those pieces of the business still seem to be held in higher regard than Yum’s two other American fast-food brands, Long John Silver’s and A&W. “[I’m] wondering whether there is a potential to sell those brands or whether we'll see those brands continue to operate here as it relates to generating incremental cash,” Jeffrey Bernstein, the restaurant analyst for Barclays Capital, asked the Yum officials on the call.
“Our goal with Long John Silver and A&W is to make those brands stronger and to build them working with our franchisees,” countered Novak.
Tuesday, December 22, 2009
Meanwhile, in non-Tiger news...
‘Tis the season to hunker down and hope for a better next year, so the restaurant business hasn’t exactly been cranking out news like an elf production line. But a few little-noticed developments in recent days might prompt some hmm’s among the ho-ho-ho’s.
Applebee’s experiments with a server-calling system. A number of franchised stores here and there are testing a tabletop device that allows guests to summon their server if something is needed. Patrons press a button on a tabletop console, which causes a watch-like device worn by their waiter or waitress to vibrate, according to a story in the Sun News, a South Carolina newspaper.
The set-up also monitors how long the guests initially sit before a server approaches. When a hostess seats a party, she waives a watch near the tabletop console. That causes the watch of the wait staffer assigned to the table to vibrate, and an unseen timer starts. If the server doesn’t show within a minute, the manager’s watch buzzes. Then a painful electric shock is directed at the tardy server. Okay, I made that up. But it’s an interesting idea.
Server alerts have been tried for eons. The 160-year-old Tadich Grill in San Francisco, for instance, features tableside buttons on the wall that patrons can press for service. A similar set-up is a signature of a classic watering hole in New York City, the International Bar.
It says a lot that those places are known for the novelty (and kitsch) of having a server-summoning system. Plenty of other converts presumably discovered that the set-up detracted from a guest’s experience. When you have to buzz for someone to take an order, you’re unlikely to coo over the attentive service you’re getting. Unless it’s handled well, patrons might as well take a number, as if they were at the supermarket deli.
Goofy has been pink-slipped by a Disney World restaurant. Other characters had their hours cut, according to a recent post on Examiner, the network of blogs that’s been set up as grassroots news service.
If the posting is accurate, I might soon spot Goofy in a state unemployment classes. The ‘Ohana Restaurant in the Polynesian Resort of Disney World was dropped Pluto’s packmate from the character rotation, or the circulation of people in Disney character costumers during meals, according to the report.
I initially suspected he got a job as the mascot for a Major League Baseball team, since a Goofy would fit just about any of the squads. But that doesn’t explain why Rabbit, a Winnie the Pooh character to which Disney owns the rights, is also gone.
Meanwhile, Eeyore, Piglet, Tigger and Pooh himself reportedly had their circulation hours cut.
And all you see on the airwaves is non-stop reporting about healthcare.
Restaurant marketing makes the list of 2009 campaigns to remember. Unfortunately, the campaigns may not be remembered for reasons the industry should cherish.
For instance, the Wall Street Journal ranked Burger King’s de-friending crusade on Facebook as the year’s fourth best marketing program. In case you’ve forgotten the furor it sparked, the campaign rewarded Facebook users with a Whopper coupon for every 10 acquaintances they “de-friended,” or publicly designated as someone they didn’t want as a friend anymore. About 234,000 people were informed of their newfound leper status before Facebook asked Burger King to knock off the high school nonsense.
It’s vexing to see that effort on the Best of the Year list when KFC’s plug from Oprah Winfrey is on the Worst-of roster. The talk-show hostess informed viewers that they could try KFC’s new Kentucky Grilled Chicken for free, triggering a run on the Colonel’s old Kentucky chicken home.
KFC halted the giveaway, saying supplies had been depleted. But it was never clear if the chain rain out the new product or merely didn’t want to give away that much free food.
In any case, the cut-off triggered more media coverage than we’d see until Tiger was brushing broken car window off his Nike shirt. The logo would be torn off later, no doubt to Woods' delight that nothing else was torn off his body.
Applebee’s experiments with a server-calling system. A number of franchised stores here and there are testing a tabletop device that allows guests to summon their server if something is needed. Patrons press a button on a tabletop console, which causes a watch-like device worn by their waiter or waitress to vibrate, according to a story in the Sun News, a South Carolina newspaper.
The set-up also monitors how long the guests initially sit before a server approaches. When a hostess seats a party, she waives a watch near the tabletop console. That causes the watch of the wait staffer assigned to the table to vibrate, and an unseen timer starts. If the server doesn’t show within a minute, the manager’s watch buzzes. Then a painful electric shock is directed at the tardy server. Okay, I made that up. But it’s an interesting idea.
Server alerts have been tried for eons. The 160-year-old Tadich Grill in San Francisco, for instance, features tableside buttons on the wall that patrons can press for service. A similar set-up is a signature of a classic watering hole in New York City, the International Bar.
It says a lot that those places are known for the novelty (and kitsch) of having a server-summoning system. Plenty of other converts presumably discovered that the set-up detracted from a guest’s experience. When you have to buzz for someone to take an order, you’re unlikely to coo over the attentive service you’re getting. Unless it’s handled well, patrons might as well take a number, as if they were at the supermarket deli.
Goofy has been pink-slipped by a Disney World restaurant. Other characters had their hours cut, according to a recent post on Examiner, the network of blogs that’s been set up as grassroots news service.
If the posting is accurate, I might soon spot Goofy in a state unemployment classes. The ‘Ohana Restaurant in the Polynesian Resort of Disney World was dropped Pluto’s packmate from the character rotation, or the circulation of people in Disney character costumers during meals, according to the report.
I initially suspected he got a job as the mascot for a Major League Baseball team, since a Goofy would fit just about any of the squads. But that doesn’t explain why Rabbit, a Winnie the Pooh character to which Disney owns the rights, is also gone.
Meanwhile, Eeyore, Piglet, Tigger and Pooh himself reportedly had their circulation hours cut.
And all you see on the airwaves is non-stop reporting about healthcare.
Restaurant marketing makes the list of 2009 campaigns to remember. Unfortunately, the campaigns may not be remembered for reasons the industry should cherish.
For instance, the Wall Street Journal ranked Burger King’s de-friending crusade on Facebook as the year’s fourth best marketing program. In case you’ve forgotten the furor it sparked, the campaign rewarded Facebook users with a Whopper coupon for every 10 acquaintances they “de-friended,” or publicly designated as someone they didn’t want as a friend anymore. About 234,000 people were informed of their newfound leper status before Facebook asked Burger King to knock off the high school nonsense.
It’s vexing to see that effort on the Best of the Year list when KFC’s plug from Oprah Winfrey is on the Worst-of roster. The talk-show hostess informed viewers that they could try KFC’s new Kentucky Grilled Chicken for free, triggering a run on the Colonel’s old Kentucky chicken home.
KFC halted the giveaway, saying supplies had been depleted. But it was never clear if the chain rain out the new product or merely didn’t want to give away that much free food.
In any case, the cut-off triggered more media coverage than we’d see until Tiger was brushing broken car window off his Nike shirt. The logo would be torn off later, no doubt to Woods' delight that nothing else was torn off his body.
Wednesday, October 7, 2009
Yum! steers its chains onto surprising turf
Yum! Brands has previewed some scrambles it’ll try in the next few months to juice up sales at its three major fast-food chains. But most were unrelated to the breakfast initiatives being plotted for Taco Bell and KFC.
Instead, the franchising giant is trying to remix its concepts' sales by venturing into some surprising territories. Here are some of the brand-bending undertakings Yum! described to financial analysts during a conference call on Wednesday:
--If you think Taco Bell is all about stuffing skateboarding dudes with as much bulk as they can buy for a buck, steel yourself. The chain will kick off 2010 with a national advertising for its Fresco line, a nine-item array of lower-fat and less-caloric selections.
If that's not enough of a departure from Taco Bell's traditional image, consider what looms on the horizon: "Longer term, we are most excited about breakfast," said Yum! CEO David Novak.
If the Taco Bell chihuahua hadn't passed away, he'd be letting out a Klingon death howl right about now.
--KFC--that's shorthand for Kentucky Fried Chicken, in case you're of a vintage that thinks Col. Harland Sanders was some Civil War hero--now derives 30% of its sales from Kentucky Grilled Chicken. "We have driven awareness to 75% of quick service restaurant users," said Novak, noting that the product is transforming the brand's image.
"We needed to broaden the appeal of this brand and we have done it," he said. Nevertheless, "continuing to drive trial is our top job."
--A major reason for Pizza Hut's 13% same-store sale drop in the third quarter was its image as a place for premium pizza, according to Novak. It shouldn't be a shocker, then, that the chain's new ads focus on chicken wings and a concept-within-the-concept, the bolted-on WingStreet wings brand. WingStreet is being positioned as a separate concept that piggybacks on Pizza Hut's delivery service.
Novak was far less effusive than he has been in past conference calls about Pizza Hut's new Toscani pasta line. He gave no reason why, but did note that the pizza chain has to do a better job of stressing the new diversity of its menu.
Novak noted that Yum! is in the process of choosing a new ad agency for Pizza Hut, precisely "to give the brand a fresh, more differentiated positioning." But he acknowledged that pastas already account for 10% of Pizza Hut's sales and figure into 30% of all transactions.
He also disclosed that breakfast is seen as a big international opportunity for KFC.
"When you look at KFC outside the United States, the only competitor we have is McDonald’s, so why can't we do breakfast?" he commented. "I mean, who is closer to the egg than Kentucky Fried Chicken?"
Novak also mentioned that Taco Bell is working on "a bigger beverage program," without divulging details. But the Orange County Register reported Wednesday night that at least two units in California are testing a juice bar featuring smoothies and a new frozen shake called the Frostbite.
Also available are fingerfood snacks like Mini Crispy Empanadas and Bacon Belly Bombers, along with cupcakes and cookies.
Instead, the franchising giant is trying to remix its concepts' sales by venturing into some surprising territories. Here are some of the brand-bending undertakings Yum! described to financial analysts during a conference call on Wednesday:
--If you think Taco Bell is all about stuffing skateboarding dudes with as much bulk as they can buy for a buck, steel yourself. The chain will kick off 2010 with a national advertising for its Fresco line, a nine-item array of lower-fat and less-caloric selections.
If that's not enough of a departure from Taco Bell's traditional image, consider what looms on the horizon: "Longer term, we are most excited about breakfast," said Yum! CEO David Novak.
If the Taco Bell chihuahua hadn't passed away, he'd be letting out a Klingon death howl right about now.
--KFC--that's shorthand for Kentucky Fried Chicken, in case you're of a vintage that thinks Col. Harland Sanders was some Civil War hero--now derives 30% of its sales from Kentucky Grilled Chicken. "We have driven awareness to 75% of quick service restaurant users," said Novak, noting that the product is transforming the brand's image.
"We needed to broaden the appeal of this brand and we have done it," he said. Nevertheless, "continuing to drive trial is our top job."
--A major reason for Pizza Hut's 13% same-store sale drop in the third quarter was its image as a place for premium pizza, according to Novak. It shouldn't be a shocker, then, that the chain's new ads focus on chicken wings and a concept-within-the-concept, the bolted-on WingStreet wings brand. WingStreet is being positioned as a separate concept that piggybacks on Pizza Hut's delivery service.
Novak was far less effusive than he has been in past conference calls about Pizza Hut's new Toscani pasta line. He gave no reason why, but did note that the pizza chain has to do a better job of stressing the new diversity of its menu.
Novak noted that Yum! is in the process of choosing a new ad agency for Pizza Hut, precisely "to give the brand a fresh, more differentiated positioning." But he acknowledged that pastas already account for 10% of Pizza Hut's sales and figure into 30% of all transactions.
He also disclosed that breakfast is seen as a big international opportunity for KFC.
"When you look at KFC outside the United States, the only competitor we have is McDonald’s, so why can't we do breakfast?" he commented. "I mean, who is closer to the egg than Kentucky Fried Chicken?"
Novak also mentioned that Taco Bell is working on "a bigger beverage program," without divulging details. But the Orange County Register reported Wednesday night that at least two units in California are testing a juice bar featuring smoothies and a new frozen shake called the Frostbite.
Also available are fingerfood snacks like Mini Crispy Empanadas and Bacon Belly Bombers, along with cupcakes and cookies.
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.
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.
Wednesday, June 10, 2009
The search is on. And on. And on.
KFC is hunting for the next Colonel Sanders. Papa John’s wants to find the muscle car that founder John Schnatter sold in 1984 to fund his first pizza. Applebee’s announced Tuesday that it’s commencing a search for America’s “real heroes.”
Add in the now-routine pursuit of customer’s ideas for new menu items, from doughnuts (Dunkin’ Donuts) to desserts (The Cheesecake Factory), and you have to wonder why restaurant chains still bother with ad agencies. They might be better off with Dog the Bounty Hunter, or even Elmer Fudd.
Call it the American Idol Effect. Restaurants are counting on the intrigue inherent in a quest to snag the attention of a public that avidly tunes into talent searches, “America’s Most Wanted” and the “National Treasure” franchise.
But they’re making a mistake if they view white-bread searches as the way to interact with customers, the arch objective in the age of Twitter and YouTube. They might as well announce a hunt to find America’s most adept flagpole sitter.
Many of the searchers should consider how Papa John’s is conducting its search. The objective is the 1972 Z 28 Camaro that Schnatter sold for his start-up investment in the restaurant business. The funds were used to convert the closet of a relative’s bar into a pizza stand.
The now-3,400-unit chain is backing up the search with live updates on Twitter and postings on a microsite, www.papasroadtrip.com. Schnatter himself is supposedly waging the search, but he brought along two interns to generate photos, videos and blog dispatches.
Papa John’s is also using a new gimmick that’s touted as a bridge between the real world and the virtual one. Customers can scan the image of a Z 28 from a Papa John’s pizza box and upload it as a virtual vehicle. The image then becomes an avatar of sorts, a visual point for taking the user on the search. It's as if the car is the sort of marker you'd use in a Monopoly game.
Finally, the search component is backed up with good ole TV advertising. Schnatter is shown delivering pies, so the focus isn’t completely off the chain’s product. There’s also the teaser of a $25,000 reward for the long-lost car.
The marketing ploy may be a search, but it’s supercharged with plenty of ways of interacting with consumers. That blend of the old with the new is increasingly being cited by social media gurus as the way to really cut through the clutter.
Add in the now-routine pursuit of customer’s ideas for new menu items, from doughnuts (Dunkin’ Donuts) to desserts (The Cheesecake Factory), and you have to wonder why restaurant chains still bother with ad agencies. They might be better off with Dog the Bounty Hunter, or even Elmer Fudd.
Call it the American Idol Effect. Restaurants are counting on the intrigue inherent in a quest to snag the attention of a public that avidly tunes into talent searches, “America’s Most Wanted” and the “National Treasure” franchise.
But they’re making a mistake if they view white-bread searches as the way to interact with customers, the arch objective in the age of Twitter and YouTube. They might as well announce a hunt to find America’s most adept flagpole sitter.
Many of the searchers should consider how Papa John’s is conducting its search. The objective is the 1972 Z 28 Camaro that Schnatter sold for his start-up investment in the restaurant business. The funds were used to convert the closet of a relative’s bar into a pizza stand.
The now-3,400-unit chain is backing up the search with live updates on Twitter and postings on a microsite, www.papasroadtrip.com. Schnatter himself is supposedly waging the search, but he brought along two interns to generate photos, videos and blog dispatches.
Papa John’s is also using a new gimmick that’s touted as a bridge between the real world and the virtual one. Customers can scan the image of a Z 28 from a Papa John’s pizza box and upload it as a virtual vehicle. The image then becomes an avatar of sorts, a visual point for taking the user on the search. It's as if the car is the sort of marker you'd use in a Monopoly game.
Finally, the search component is backed up with good ole TV advertising. Schnatter is shown delivering pies, so the focus isn’t completely off the chain’s product. There’s also the teaser of a $25,000 reward for the long-lost car.
The marketing ploy may be a search, but it’s supercharged with plenty of ways of interacting with consumers. That blend of the old with the new is increasingly being cited by social media gurus as the way to really cut through the clutter.
Friday, May 8, 2009
YouTube: Good for the soul?
Catholics use the confessional to ask for forgiveness. Restaurant executives seem to prefer YouTube.
The latest mea culpa was posted Thursday by KFC, after it infuriated freebie hounds by suspending a much-ballyhooed giveaway of grilled chicken. “On behalf of all our employees and franchisees, I just wanted to apologize to you. The response to our Kentucky Grilled Chicken has been overwhelming,” chain president Roger Eaton says in the video. “So we can’t redeem your free coupon at this time.”
Translation: Our chicken was so good that the moochers scarfed up all the samples we were willing to give away. But here’s a raincheck and a promise of a soft drink for your troubles.
He should’ve studied Domino’s handling of the employee shenanigans at a North Carolina unit to see what a regretful chain executive looks like. Patrick Doyle, the pizza chain’s U.S. president, came across as genuinely sorry and outraged that two knucklehead employees would mess with a restaurant’s food. “It sickens me,” says Doyle. “We sincerely apologize for this incidence…We are taking this incredibly seriously.”
Let that be a lesson to any chain that’s considering a YouTube apology for lapses like, oh, maybe serving a snake’s head in some broccoli, or selling a Happy Meal with a condom inside.
That’s assuming T.G.I. Friday’s and McDonald’s will turn to the Tube for their make-nice efforts. Several other chains didn't use the video-sharing site to explain their big-time blunders. Instead, Quiznos just let its recent free-subs fiasco reek in public for awhile. Crain’s Chicago Business quoted an official as charactering the Million Subs Giveaway as a marketing home run despite the fallout with some customers.
Burger King apologized via more traditional media for its “little Mexican” depiction in a European ad campaign, but it has yet to address parents who are outraged by the chain’s SpongeBob SquarePants commercial for U.S. youngsters.
Hey, it’s worth 15 minutes and the investment in a Flip video camera.
Friday, March 6, 2009
YouTube may be more their tube after all
Online videos are supposed to be a great leveler, allowing any pulse-bearer with a camera to become a star. Think of YouTube celebrities like “unsexy newsman” Philip DeFranco, “dance historian” Judson Laipply, or even the skateboarding bulldog.
Yet the big and supposedly un-cool restaurant chains are clearly making more of a splash in that grassroots medium than independents or regional brands. Yesterday proved the point, with the internet buzzing about this goof on KFC from Mel Gibson and Jimmy Kimmel Live!...
…and this response from KFC’s mega-sized parent, Yum! Brands:
And let’s not forget the latest from Jack in the Box, which has been on a video binge with its recent focus on the near-death experiences of mascot Jack Box:
Contrast that with this YouTube video from Pal’s Sudden Service, a regional quick-service chain with a cult following:
…Or this spot from an independent in Utah:
Clearly the big brands are digging into their deeper pockets to come up with better conceived and executed spots. Money, it appears, can indeed buy edginess.
Yet the big and supposedly un-cool restaurant chains are clearly making more of a splash in that grassroots medium than independents or regional brands. Yesterday proved the point, with the internet buzzing about this goof on KFC from Mel Gibson and Jimmy Kimmel Live!...
…and this response from KFC’s mega-sized parent, Yum! Brands:
And let’s not forget the latest from Jack in the Box, which has been on a video binge with its recent focus on the near-death experiences of mascot Jack Box:
Contrast that with this YouTube video from Pal’s Sudden Service, a regional quick-service chain with a cult following:
…Or this spot from an independent in Utah:
Clearly the big brands are digging into their deeper pockets to come up with better conceived and executed spots. Money, it appears, can indeed buy edginess.
Tuesday, February 17, 2009
Popeyes' parent seeks court help with founder's co.
Col. Harland Sanders would probably be comforted to learn his fast-food brainchild, KFC, recently built a sturdier vault to safeguard the formula of herbs and spices he concocted to give the chicken a distinctive taste. Over at the rival Popeyes Louisiana Kitchen chain, dealings with the founder's legacy aren't going nearly as well.
Popeyes' current parent, AFC Enterprises, asked a court today to arbitrate a dispute between the company and the concern that supplies the spices for the Cajun-style chicken that sets the chain apart. The spice mix is supplied by Diversified Foods & Seasonings, a concern started and overseen by Popeyes founder Al Copeland until his death last year. AFC contends that Diversified is charging too much for the peppery blend that gives Popeyes' chicken its kick.
AFC is also seeking a declaration from the court that the franchisor has the right to determine if the spice blend should be changed for regulatory, nutritional or economic reasons. IIf the court grants the declaratory judgement, Diversified couldn't cheapen the mix without AFC's okay. Or, coming at it from the other direction, AFC could determine if some cost should come out of the spicing.
What's more intriguing is the stipulation that AFC has a say over nutritional or regulatory-related changes in the recipe. New York City is pressing fast-food chains voluntarily to cut the salt in their recipes. If they don't go along, they'll likely be hit by a a government mandate to reduce the sodium. Is AFC setting the groundwork to comply with NYC's demand, or a similar insistence from jurisdictions that follow Gotham's ead?
AFC and various Al Copeland proxies have often been at odds. Indeed, AFC came into being in large part to distance Copeland from his chain and another fried chicken chain he acquired back in the 1980s, Church's. The purchase remains one of the strangest foodservice deals ever. Popeyes and Church's were direct competitors, had largely overlapping markets, and showed every indication of being incompatible siblings. What prompted Copeland to even consider such a deal? Many, many observers suggested it was a function of ego.
He ended up losing so much money that he was forced to step away from the two-concept company. However, he continued to supply spices and foods to Popeyes, even as he dabbled with other restaurant concepts, including the Copeland's dinnerhouse chain.
Diversified had yet to issue any public comment on the matter as of this posting. The court request was filed by AFC roughly at the end of the business day.
"While awaiting the decision of the court and the arbitrator, it is business as usual at Popeyes," said AFC CEO Cheryl Bachelder said.
Popeyes' current parent, AFC Enterprises, asked a court today to arbitrate a dispute between the company and the concern that supplies the spices for the Cajun-style chicken that sets the chain apart. The spice mix is supplied by Diversified Foods & Seasonings, a concern started and overseen by Popeyes founder Al Copeland until his death last year. AFC contends that Diversified is charging too much for the peppery blend that gives Popeyes' chicken its kick.
AFC is also seeking a declaration from the court that the franchisor has the right to determine if the spice blend should be changed for regulatory, nutritional or economic reasons. IIf the court grants the declaratory judgement, Diversified couldn't cheapen the mix without AFC's okay. Or, coming at it from the other direction, AFC could determine if some cost should come out of the spicing.
What's more intriguing is the stipulation that AFC has a say over nutritional or regulatory-related changes in the recipe. New York City is pressing fast-food chains voluntarily to cut the salt in their recipes. If they don't go along, they'll likely be hit by a a government mandate to reduce the sodium. Is AFC setting the groundwork to comply with NYC's demand, or a similar insistence from jurisdictions that follow Gotham's ead?
AFC and various Al Copeland proxies have often been at odds. Indeed, AFC came into being in large part to distance Copeland from his chain and another fried chicken chain he acquired back in the 1980s, Church's. The purchase remains one of the strangest foodservice deals ever. Popeyes and Church's were direct competitors, had largely overlapping markets, and showed every indication of being incompatible siblings. What prompted Copeland to even consider such a deal? Many, many observers suggested it was a function of ego.
He ended up losing so much money that he was forced to step away from the two-concept company. However, he continued to supply spices and foods to Popeyes, even as he dabbled with other restaurant concepts, including the Copeland's dinnerhouse chain.
Diversified had yet to issue any public comment on the matter as of this posting. The court request was filed by AFC roughly at the end of the business day.
"While awaiting the decision of the court and the arbitrator, it is business as usual at Popeyes," said AFC CEO Cheryl Bachelder said.
Monday, February 9, 2009
That kind of a week
Some weeks you might as well use a reporter’s notebook to level wobbly restaurant tables. The industry just isn’t making any news.
This, clearly, is not one of them.
Before Day One was officially two hours old, we already had McDonald’s posting another Ripley’s-caliber financial result (domestic comps rising 5.4% in January, a month regarded by most restaurant-chain execs as a possible violation of the Geneva Convention); Starbucks’ unveiling of new breakfast bargains; Domino’s launch of a new ad campaign that humorously riffs on the economic stimulus package and the formation of a new White House cabinet; and Applebee’s getting hit with bad news that few could have imagined (it's not meeting the thresholds needed to maintain its 90% tax abatement on the office it kept in Kansas after being sold to DineEquity in California).
This is also the week KFC is scheduled to introduce its value menu, which will almost certainly be backed by a huge marketing push.
More definitely to follow. Buckle your seatbelts.
This, clearly, is not one of them.
Before Day One was officially two hours old, we already had McDonald’s posting another Ripley’s-caliber financial result (domestic comps rising 5.4% in January, a month regarded by most restaurant-chain execs as a possible violation of the Geneva Convention); Starbucks’ unveiling of new breakfast bargains; Domino’s launch of a new ad campaign that humorously riffs on the economic stimulus package and the formation of a new White House cabinet; and Applebee’s getting hit with bad news that few could have imagined (it's not meeting the thresholds needed to maintain its 90% tax abatement on the office it kept in Kansas after being sold to DineEquity in California).
This is also the week KFC is scheduled to introduce its value menu, which will almost certainly be backed by a huge marketing push.
More definitely to follow. Buckle your seatbelts.
Thursday, February 5, 2009
New menu-item roundup
A few leads have leaked out about the next round of chain menu additions. Here’s a sampling as of early this afternoon:
--Carl’s Jr. may be bringing back its chili dog, judging from a few non-committal posts on Twitter.
--Burger King plans to add a thicker burger, called the Steakhouse XT (the “XT” apparently stands for “extra thick.”
--KFC will roll out its value menu next week. What it touts as a game changer, the addition of chicken that’s supposedly grilled (it’s actually flash-baked on a plate that imparts grill marks) is slated for April.
--Dairy Queen will introduce its value menu next month.
--O’Charley’s will introduce several new brunch items when it changes menus later this month.
--Hardee’s is pushing an “authentic” Chicken Parmesan sandwich.
--Carl’s Jr. may be bringing back its chili dog, judging from a few non-committal posts on Twitter.
--Burger King plans to add a thicker burger, called the Steakhouse XT (the “XT” apparently stands for “extra thick.”
--KFC will roll out its value menu next week. What it touts as a game changer, the addition of chicken that’s supposedly grilled (it’s actually flash-baked on a plate that imparts grill marks) is slated for April.
--Dairy Queen will introduce its value menu next month.
--O’Charley’s will introduce several new brunch items when it changes menus later this month.
--Hardee’s is pushing an “authentic” Chicken Parmesan sandwich.
Clouds in industry's coffee this morning
The bad news is starting early today, with Burger King disclosed a 10% drop in profits for its most recent quarter and O'Charley's posting a $103-million loss for 2008. The standout number: an 18% decline in same-store sales for O'Charley's Stoney River steakhouse chain, and the $7.99 price tag on new promotional items at the company's namesake brand.
O'Charley's said it has cut costs by cutting back its headquarters staff, freezing salaries and undertaking a "redesign" of benefits for hourly employees.
BK blamed its financial disappointment largely on unfavorable currency exchange rates. It stressed that North American comps had increased 1.9%, and noted that it will introduce in some areas a new, "extra thick" burger called the Steakhouse XT.
On Tuesday Yum! Brands also posted a double-digit drop in profits for its most recent quarter. Among the gems delivered in its follow-up call with analysts was the disclosure that KFC will introduce its value menu next week and will roll out the much-ballyhooed Kentucky Grilled Chicken line in April.
O'Charley's said it has cut costs by cutting back its headquarters staff, freezing salaries and undertaking a "redesign" of benefits for hourly employees.
BK blamed its financial disappointment largely on unfavorable currency exchange rates. It stressed that North American comps had increased 1.9%, and noted that it will introduce in some areas a new, "extra thick" burger called the Steakhouse XT.
On Tuesday Yum! Brands also posted a double-digit drop in profits for its most recent quarter. Among the gems delivered in its follow-up call with analysts was the disclosure that KFC will introduce its value menu next week and will roll out the much-ballyhooed Kentucky Grilled Chicken line in April.
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