logo
Applebee's owner Dine Brands to lean on value, marketing to reverse sales declines

Applebee's owner Dine Brands to lean on value, marketing to reverse sales declines

NBC News06-03-2025

Dine Brands hopes to boost sales this year with a wider swath of value meals and buzzier advertising after a rough 2024 for Applebee's and IHOP.
'We had a soft year in 2024, which disappoints us, but we're focused on improving that in 2025,' Dine Brands CEO John Peyton told CNBC. 'We've got to have compelling messages and compelling promotions and compelling reasons to drive traffic into the restaurants.'
Dine on Wednesday reported fourth-quarter U.S. same-store sales dropped 4.7% at Applebee's and 2.8% at IHOP, ending the year with four straight quarters of domestic same-store sales declines for its two flagship brands. Shares of Dine have fallen 50% over the last 12 months, dragging its market cap down to $386 million.
The company's down year followed three years of strong growth for the company, driven by pent-up demand as diners returned to IHOP and Applebee's after the pandemic. But like many restaurant companies, Dine saw a pullback last year from customers who make less than $75,000. After several years paying higher prices for groceries, rent, gas and other necessities, consumers opted to stay home to cook their meals or visit other chains that offered better deals or flashy promotions.
The slowdown in restaurant spending led a slew of casual-dining restaurant chains to file for bankruptcy over the last 12 months. Familiar names like Red Lobster and TGI Friday's sought bankruptcy protection to reorganize their struggling businesses and offload their worst-performing restaurants. Most recently, On the Border filed for Chapter 11 bankruptcy on Tuesday.
Applebee's promotions have failed to cut through much of the noise from the so-called value wars that have ignited across the restaurant industry, at chains from McDonald's to Bloomin' Brands' Outback Steakhouse. Even a triad of recent pop-culture moments last year couldn't boost its profile: a pivotal cameo in the tennis drama film 'Challengers,' an Applebee's-motivated meltdown on 'Survivor' and a shoutout from football legend Peyton Manning during Netflix's roast of his former rival Tom Brady.
'You've got most of the restaurant companies are advertising value, and they're advertising full meal deals, and so it's harder to break through with a message when there are so many similar messages out there,' Dine's Peyton said.
But it's not impossible to break out from the pack. Chili's, which is owned by Brinker International, won over diners with its viral Triple Dipper and $10.99 burger combo after spending months turning around its business.
In its most recent quarter, Brinker reported same-store sales growth of 27.4%. Thanks to its dramatic comeback, the company has become the rare casual-dining darling of investors. Brinker's stock has soared over the last year, nearly tripling its value in the same period and raising its market cap to $6.29 billion.
For now, the star of Applebee's value promotions, the two for $25 deal, routinely accounts for roughly a fifth of the chain's tickets, according to Peyton. But Applebee's is looking to add to its value offerings later this spring or in the early summer with options that appeal to larger groups or to customers who don't want to order with their dining partner.
Dine is also trying to improve its social media presence.
'At both IHOP and Applebee's, we know we need to do better there. We know we need to be more relevant. We know that we have to be part of the conversation and the culture,' Peyton said.
A new president for Applebee's could help with that goal.
Peyton is currently pulling double duty serving as interim president for the chain after Tony Moralejo stepped down effective Tuesday. Peyton said the company is looking for a replacement 'with a great marketing background' who understands how to connect with younger customers, on top of being a great leader with an understanding of franchising and some restaurant experience. (Yum Brands' Lawrence Kim joined Dine as IHOP's president in early January, succeeding Jay Johns.)
Looking to 2025, Dine is trying to communicate better with its customers and use its menu innovation to attract younger diners, according to Peyton.
But Dine's confidence in its ability to attract customers seems shaky. For 2025, the company is projecting Applebee's same-store sales to range between a 2% decline and a 1% increase and IHOP's same-store sales to range between a 1% decrease and a 2% gain.

Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

EchoStar prepares potential bankruptcy filing amid FCC review, WSJ reports
EchoStar prepares potential bankruptcy filing amid FCC review, WSJ reports

Reuters

time3 days ago

  • Reuters

EchoStar prepares potential bankruptcy filing amid FCC review, WSJ reports

June 6 (Reuters) - EchoStar (SATS.O), opens new tab is considering a Chapter 11 bankruptcy filing as the telecommunications services firm vies to shield its cache of wireless spectrum licenses from the threat of revocation by federal regulators, the Wall Street Journal reported on Friday, citing people familiar with the matter. The company declined to comment on the report. Last month, the Federal Communications Commission (FCC) notified, opens new tab EchoStar it was investigating the company's compliance with certain federal obligations to provide 5G service in the U.S., questioning EchoStar's buildout extension and mobile-satellite service. FCC's actions have severely limited the company's ability to make strategic decisions regarding the growth and investment of its Boost Mobile business, according to a regulatory filing by the company last month. EchoStar has previously disclosed that it missed roughly $500 million in interest payments, citing uncertainty around the ongoing FCC review. U.S. satellite TV provider DirecTV terminated its agreement to acquire EchoStar's satellite television business last year, which includes rival Dish TV, over a failed debt-exchange offer.

Brazil's Azul aims to exit Chapter 11 early 2026, says exec
Brazil's Azul aims to exit Chapter 11 early 2026, says exec

Reuters

time30-05-2025

  • Reuters

Brazil's Azul aims to exit Chapter 11 early 2026, says exec

SAO PAULO, May 30 (Reuters) - Brazilian airline Azul (AZUL.N), opens new tab aims to exit Chapter 11 proceedings early next year, Fabio Campos, institutional and corporate vice-president, told reporters in a press conference on Friday. Asked about plans to combine operations with local airline Gol ( opens new tab, Campos said Azul will now focus primarily on its financial restructuring process. Azul filed for Chapter 11 in the United States earlier this week.

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into the world of global news and events? Download our app today from your preferred app store and start exploring.
app-storeplay-store