Applebee’s Owner Says It Found Formula to Stand Out on UberEats
(Bloomberg) -- Goodbye Neighborhood Wings. Hello Flamin’ Hot Cheetos-flavored wings.
Dine Brands Global Inc., the owner of Applebee’s and IHOP, is winding down its initial ghost-kitchen brand and replacing it with Cosmic Wings, a concept that the company says will better stand out on the UberEats delivery app. It will offer normal and boneless wings and waffle fries with different flavors, and at prices that are generally lower than the previous offerings.
“The intent of that pilot was to derive learning and to understand how to best participate in this space,” said Scott Gladstone, vice president of strategy and development at Applebee’s. “It really highlighted the need for a brand that really stands out.”
The shift in strategy shows how restaurant companies are experimenting amid Covid-19 to win back some of the sales that have evaporated amid widespread social distancing. During the pandemic, fast-food and delivery-focused companies have broadly captured market share from the casual-dining segment, forcing them to try new ideas.
It also underscores how companies can tear down one virtual concept and offer a new one to take its place very quickly -- a move that would be prohibitively expensive and risky for a brick-and-mortar chain.
Dine Brands has reported a series of sales declines in recent quarters, upping the urgency of its quest to find an online presence that resonates. The company, which has said it’s closing some Applebee’s and IHOP locations, is scheduled to report fourth-quarter results on March 2.
Gladstone declined to comment on the performance of Neighborhood Wings. He said the new concept’s Cheetos-flavored menu items and spicier fare will attract customers -- especially younger ones like Millennials and Gen Z.
“Cheetos is on trend, it’s one of America’s favorite brands,” he said.
While Neighborhood Wings’ prices were similar to those at Applebee’s, Cosmic Wings will charge less on average. About 1,300 of 1,600 Applebee’s locations will offer Cosmic Wings.
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