The Real Reason Applebee’s Is Struggling
The Real Reason Applebee’s Is Struggling: Since 1980, when they first opened their doors, Applebee’s has been a go-to place for casual eating.
In 1986, they became everyone’s favorite Neighborhood Bar & Grill. Before that, they were called TJ Applebee’s Rx for Edibles and Elixirs.
During the 1990s, they grew a lot, and in 1998, they opened their 1,000th site. That’s a big deal, especially given that they only had 250 locations across the country in 1992.
Applebee was at its best in the 20th century, but times? They have grown.
The chain seemed to be at its best in the early 2000s, when it had more than 1,500 stores and was growing in countries like Ecuador, Chile, and Jordan.
They did a lot of things right, like adding healthy options to their menu and starting their Carside To Go service.
But Business Insider says that the number of Applebee’s that close each year has been going up since 2016, and the chain still has falling sales and other problems.
Hundreds of places have shut down, so what’s going on with this place, which used to be a popular hangout?
When considering affordable lunch options, Applebee’s menu prices offer great value for your money.
Millennials aren’t impressed
It’s no news that the way people eat is changing around the world. People are more health-conscious and more aware of where their food comes from. Thanks to millennials, eating styles are also changing.
Applebee’s started what Business Insider called a “comprehensive business transformation” in 2016. The goal of this change was to bring the chain up to date and make it more appealing to younger customers.
Locations were redesigned, kitchens were redone, and anyone who hadn’t been to Applebee’s in a while would see a totally different menu.
In 2015, the Huffington Post said that Applebee’s was changing into what they called a “millennial bar.”
They said that Applebee’s had added trendy new items like brisket nachos, sweet potato fries, platters to share, new drinks, and three new menu categories: Shareables, Bar Snacks, and Pub Plates.
Trying to get more people in the door sounds like a great idea, but it didn’t work at all with millennials. Even worse, the renovation cost owners millions of dollars, which is not easy to get over.
They alienated core customers
When HuffPo wrote about Applebee’s new image in 2015, they said that families were a big part of their old image that was missing from their new one.
Applebee’s main customers for years were families, but all of a sudden, they weren’t.
Applebee’s knew it was important to find the right balance. John Cywinski, head of the brand, told Fortune, “We want to reach more people, but we can’t turn off Boomers or Gen-Xers in the process.”
But it did happen that way. By 2017, the people in charge of Applebee’s had to face the harsh reality that not only had they failed to attract millennials, but they had changed so much that their regular customers were no longer interested.
Cywinski told QZ, “From my point of view, this led to decisions that confused Applebee’s regular customers, as the restaurant purposely moved away from what I’ll call its Middle American roots.”That kind of mistake can ruin a business.
Casual dining as a whole is failing
The craziest thing is that Applebee’s wasn’t wrong when they said they needed to change things up a bit to appeal to a younger crowd.
They’re not the only ones having trouble with millennials. According to Business Insider, casual dining places like Ruby Tuesday and TGI Fridays are also dealing with the same huge shift in tastes.
There are a few things going on here, and one of them is that millennials tend to go to fast casual restaurants like Chipotle and Five Guys instead of more traditional casual eating places.
They are also more likely to order delivery than previous generations. However, because supermarkets are more fairly priced and companies like Blue Apron offer meal delivery kits, they are more likely to just cook at home.
According to Business Insider and TDn2K’s Restaurant Industry Snapshot, another reason why casual dining is failing is that there are just too many places and the market can’t support them all.
They’re late to embrace shifts in industry trends
Early in 2018, the CEO of DineEquity Inc., the company that owns Applebee’s, talked to the Los Angeles Times (via Phys.org).
They were trying to fix both Applebee’s and IHOP. Stephen P. Joyce says that most of their problems came from forgetting what their customers really wanted.
Part of this is a more efficient use of technology, which is an industry trend that they have been slow to join.
Joyce said that they would add things like delivery choices and ways to make it easier to place an order. Victor Fernandez, an industry expert at TDn2K, says that mealtimes are another problem.
People are eating at weird times more and more, and they want options that will let them eat whenever their plans require.
Applebee’s is making it easier to order and eat there by finally releasing their own mobile apps and, believe it or not, putting WiFi in all of their sites.
Diners can now pay with their phones, which has been needed for a long time.
The have weird views on technology
Even the need to check Facebook every five minutes isn’t a reason. Think of business meetings over appetizers, friends eating lunch while still needing to check their email, or parents getting a quick bite to eat while waiting for their kids to let them know they’re ready to be picked up.
WiFi is a must-have in the modern world, but Applebee’s seems to be slow to catch on.
Back in 2014, Today reported that Applebee’s had filed for a trademark on “No tech Tuesday,” which seemed to indicate that they were thinking about asking customers to put away their phones for a good, old-fashioned, face-to-face dining
experience — at least for one day of the week. We tried to find out more about the plan, but we couldn’t.
The chain’s manager, Dan Smith, denied that people would be asked to keep their phones in their pockets, but it’s still a strange thing to even think about doing in the modern world.
The food quality isn’t great
You can’t change stations or scroll through social media without seeing food pictures. Food that is both tasty and healthy.
Applebee’s hasn’t really stepped up their game to compete with other restaurants in the 21st century, and that shows in another part of today’s social media-driven world: online reviews.
Consumer Affairs says that the Applebee’s reviews they’ve read give the chain a pretty sad 1.5 stars out of 5. That alone is enough to make people not want to go there right away, and that’s just the beginning.
There are a lot of reviews of Applebee’s on Tripadvisor, and some of the pictures on the site are even more disturbing.
Reviews are just people’s opinions, but photos are proof, and The Detroit News says that not much on Applebee’s menu looks good on Instagram.
Just look at that picture of the Southwestern Steak Salad that went viral (via BuzzFeed) at the end of 2017. Even though the picture on the menu looks great, the dish itself doesn’t match up.
Even Chili’s joined in to make fun of the picture, which doesn’t make things better.
There’s a lack of diversity
So, let’s say you’re on a trip. You’re going somewhere on the other side of the country from where you live, and you want to try some local foods while you’re there.
Applebee’s is the only place you won’t go, which is a problem.
The Detroit News says that Applebee’s is too strict, which is another piece of the failure puzzle. Every restaurant has the same menu, which can be a good thing or a big problem.
There is no special menu that highlights local foods. For example, you won’t find fresh seafood on the menu in Florida and Maryland, but you will find Creole meals in New Orleans in the same spot.
And it’s funny, since the name of the place is “Neighborhood Bar & Grill.” Everyone always knows what they’re going to get on the menu, so there’s no reason to go out of your way to try a new place.
They’re not the healthiest
The Center for Science in the Public Interest gives out the Xtreme Eating Awards every year. It’s not really an award that anyone would be happy to get.
Applebee’s Build Your Sampler plate won the top spot in 2016, and it’s easy to see why. Even if you share it with a group of people, there’s no way to make this dish even a little bit healthy.
It can be made any way you want, but the worst way to eat it is on a platter with 3,390 calories and 11,650 mg of salt. The American Heart Association says that people shouldn’t try to get more than 1,500 mg per day.
Let’s put it this way: if you order an appetizer and split it with three other people, then order a main course, you’re still getting the same amount as two full meals.
Even though Applebee’s has some good options, it’s easy to fool yourself into thinking you’re making smart choices when you’re not.
The Oriental Grilled Chicken Salad is a good example. Sounds good, doesn’t it? You’re eating 1,310 calories and 2,230 mg of salt, so… not really.
They committed social media suicide
In 2013, Applebee’s did something that News.com.au called “social media suicide.” They said it was a textbook example of how not to handle a problem in the digital world.
It all started when an Applebee’s waitress shared a picture of a receipt with no tip and the words, “I give God 10%, why do you get 18?”
Not cool, but what really started all the trouble was when Applebee fired the waiter. They said she had broken a contract clause, but social media didn’t believe them.
Applebee’s posted an early morning apology to the customer and “disciplinary action” to the waitress for violating the customer’s privacy a month earlier when they posted a photo of another receipt with a customer’s full name.
They were called out on it, which wasn’t a big surprise.
In just a few hours, the whole mess got more than 35,000 comments, most of which called Applebee’s bias out. Thousands of people wanted to stop going to the chain, which is not good for business.
There were allegations of harassment
Restaurant work is hard, and at the beginning of 2018, news came out that Applebee’s was making it even harder for women.
Vox says that more than 60 employees of Applebee’s and its sister company, IHOP, have filed sexual harassment cases in federal courts.
That’s only 2010–2018 lawsuits. Women filed lawsuits against individual franchise owners, claiming they were ridiculed or threatened with job loss if they refused sex requests.
Applebee’s and IHOP both put out official statements to try to get away from the idea that they fostered a toxic and abusive work atmosphere.
Vox also points out that they’re not the only ones who have been accused of this.
But they also say that they are at the top of the pile and that it’s hard to know how many people have come forward because most cases are handled privately by the US Equal Employment Opportunity Commission.
FAQs-The Real Reason Applebee’s Is Struggling
Applebee’s is struggling due to various factors, including increased competition, changing consumer preferences, and a decline in overall casual dining sales.
The rise of fast-casual restaurants and delivery apps has intensified competition, drawing customers away from traditional sit-down chains like Applebee’s.
Yes, changing consumer preferences have played a significant role. Many consumers are now seeking healthier and more diverse dining options, which Applebee’s traditional menu may not fully cater to.
Applebee’s has made efforts to introduce healthier menu options and revamp their offerings, but they may have struggled to keep up with the rapidly changing food trends and preferences of consumers.
The overall decline in casual dining sales has impacted Applebee’s, as fewer people are opting for sit-down dining experiences, leading to decreased foot traffic and sales.
Yes, the popularity of delivery services has affected Applebee’s, as more customers now prefer to order food from the comfort of their homes rather than dine out.
Applebee’s has implemented various strategies, including menu innovations, remodeling efforts, and promotional campaigns, to attract new customers and retain existing ones.
Applebee’s has faced criticism for its perceived lack of uniqueness and authenticity compared to independent restaurants or niche establishments, which has impacted its brand image.
Like many other restaurants, Applebee’s experienced significant disruptions during the pandemic, including temporary closures, limited capacity, and a shift to takeout and delivery models.
Regional differences in consumer preferences, as well as the age and income demographics of certain areas, can impact Applebee’s performance, as it may struggle to resonate with specific markets.
Internal issues, such as ineffective marketing strategies or operational inefficiencies, could potentially contribute to Applebee’s struggles in maintaining its market position.
The overall economic climate can influence consumer spending habits, and during times of economic downturns, consumers may cut back on discretionary spending, including dining out, which can affect Applebee’s performance.
Applebee’s can consider further menu innovations to cater to changing tastes, enhance its brand image by focusing on unique experiences, and invest in digital marketing and delivery infrastructure to meet evolving customer demands.
While Applebee’s faces challenges, the restaurant industry is dynamic, and with effective strategies, adaptability, and continued efforts to meet customer needs, there is a possibility for Applebee’s to recover and find success in the future.