Applebee\u2019s and IHOP owner\u00a0Dine Brands\u00a0thinks its deals can lure away fast-food customers who have grown frustrated with menu prices.<\/p>\n
As\u00a0consumers pull back\u00a0their restaurant spending, Applebee\u2019s and IHOP are fighting against a larger group of rivals than usual for a smaller pool of customers. Dine Brands CEO John Peyton said full-service restaurants, fast-food chains and even eating at home are all competing for diners\u2019 dollars.<\/p>\n
To rise above the competition, Applebee\u2019s has been leaning into value with a slate of promotions that includes the return of Dollaritas, which makes Peyton confident that it can beat out the fast-food chains vying for its customers.<\/p>\n
\u201cThe Whole Lotta Burger for $9.99 \u2014 if you can have our burger for $10, which is great quality, abundant and eat in our restaurant, in our experience, why would you eat a $10 burger out of a paper bag in your car?\u201d he told CNBC.<\/p>\n
Low-income consumers visited less frequently and spent more carefully when they did eat out in the first quarter, according to Peyton. Consumers with incomes under $50,000 account for about 40% to 50% of Dine\u2019s customers, he said.<\/p>\n
Dine Brands reported first-quarter\u00a0earnings\u00a0that fell short of Wall Street\u2019s estimates, and both Applebee\u2019s and IHOP\u2019s\u00a0same-store sales shrank\u00a0more than expected. Still, Dine reiterated its full-year outlook and said sales have improved sequentially. Shares of the company closed roughly flat.<\/p>\n
But it\u2019s too soon to tell if Dine will succeed in winning over diners \u2014 and investors. The company will need to improve its same-store sales growth significantly to meet the full-year outlook it reiterated this year, Raymond James analyst Brian Vaccaro wrote in a research note on Wednesday.<\/p>\n
Applebee\u2019s isn\u2019t the only casual dining chain aiming at\u00a0McDonald\u2019s\u00a0and the rest of the fast-food category. Chili\u2019s, which is owned by\u00a0Brinker International, recently rolled out an ad campaign that calls out the Big Mac and other fast-food burgers for their prices.<\/p>\n
And McDonald\u2019s is certainly feeling the heat. CEO\u00a0Chris Kempczinski told\u00a0analysts on the company\u2019s latest earnings call that \u201ceverybody\u2019s out there with a value message,\u201d which is why the chain is looking to create a nationwide value menu.<\/p>\n
Besides leaning into deals, Applebee\u2019s might also get an edge on the competition from a triad of recent pop-culture moments: a pivotal cameo in the tennis drama film \u201cChallengers,\u201d an Applebee\u2019s-motivated meltdown on \u201cSurvivor\u201d and a shoutout from football legend Peyton Manning during Netflix\u2019s roast of his former rival Tom Brady.<\/p>\n
Not since Beyonce name-dropped Red Lobster on her hit song \u201cFormation\u201d has a casual-dining chain felt so relevant in pop culture.<\/p>\n
\u201cIt\u2019s top of mind for so many people, and it\u2019s because they\u2019ve grown up with Applebee\u2019s,\u201d Peyton said.<\/p>\n<\/p>\n
Applebee\u2019s and IHOP owner\u00a0Dine Brands\u00a0thinks its deals can lure away fast-food customers who have grown frustrated with menu prices. As\u00a0consumers pull back\u00a0their restaurant spending, Applebee\u2019s and IHOP are fighting against a larger group of rivals than usual for a smaller pool of customers. Dine Brands CEO John Peyton said full-service restaurants, fast-food chains and even […]<\/p>\n","protected":false},"author":0,"featured_media":4199,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-4198","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"_links":{"self":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/4198","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/comments?post=4198"}],"version-history":[{"count":0,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/4198\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media\/4199"}],"wp:attachment":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media?parent=4198"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/categories?post=4198"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/tags?post=4198"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}