Popeyes Final Report PDF

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1 Introduction Popeye’s Louisiana Kitchen is an American fast food restaurant that was founded in 1972 in New Orleans, Louisiana and headquartered in Miami, Florida. Popeyes is known for their fried chicken and is competing against many other fast food restaurants that serve similar food items including burgers, sandwiches, poutines and more. These competitors include McDonald’s, Wendy’s, Chick-Fil-A and many other alternatives, as they are all fast food restaurants that sell similar food items. To enhance the business, Popeye’s needs to use their strengths to develop opportunities and eliminate weaknesses to remove competitive threats. Chick-Fil-A had posted a tweet critiquing Popeyes’ new chicken sandwich, and Popeyes’ reply then went viral within minutes. The tweet immediately turned into a meme and increased the demand for their new product that was selling nationwide. This displayed the global outreach that their social media accounts have and their capability to market internationally. Our goal is to analyze Popeye’s as a business and through doing that we have determined that it would be beneficial to relaunch the chicken sandwich. In doing that, we will devise a plan to ensure that all areas have been researched and there will be sufficient supply at each restaurant. Stakeholders Analysis Popeye’s external stakeholders are their customers and the main goal is to satisfy and meet their needs. It is clear that a majority of the customers who ordered chicken sandwiches discovered the company or gained interest through Twitter. In terms of Twitter demographics, 34% of Twitter users are females and 66% are males (Omnicore, 2019). This shows that more males are using Twitter and that the tweet and memes regarding the Popeye’s and Chick-Fil-A Twitter feud has a male-dominated reach. It is also shown that 37% of Twitter users are between the ages of 18 and 29 and that 25% of users are between the ages of 30 and 49 (Omnicore, 2019). A majority of Twitter users are millennials, also known as Generation Y. Since Popeye’s chicken sandwich became popular through the means of social media, specifically Twitter, gathering data on Twitter users (which ages use it the most) allows us to segment the individuals who take interest on Popeyes’ product. It is clear that a majority of individuals aged 18 to 29 use Twitter and are the age segment that we are aiming to attract. Franchises need to make sure that they are equipped with all the supplies to produce products in a fast and efficient manner. This begins with the employees, being trained and able to prepare each product with ease. Next comes the equipment used to make the chicken sandwich, such as a deep fryer to fry the chicken. It is important that each part of the chain to create the sandwich is up to code and is clean and up to all regulations. The way that the product is delivered and served is also very important. Employees whose job it is to assist customers in order taking need to make sure that they put forward great customer service skills so that the customer leaves the store satisfied with not only the food, but with a good overall experience. Marketing Mix Product Popeye’s Chicken is offering their tangible good that is well known as the chicken sandwich to the public. The chicken sandwich satisfies people's physiological needs, as it is food, something that is a basic need and necessity to all human beings. Since Popeye’s is a fast food restaurant, it also satisfies people's esteem needs, as people choose to eat the food that they serve due to contentment in the quality of food being received by the customers. Popeyes is a very popular fast food restaurant, especially after being recognized on Twitter, the company has built a strong brand name and satisfied its customers, which resulted in a high demand for their

2 chicken sandwiches. People felt included in the trend of the product by ordering the chicken sandwich, thus meeting their esteem needs. Price A chicken sandwich at Popeye’s costs $3.99 (Fast Food Menu Prices, 2019), which was satisfied by customers due to the high demand for the product. Popeyes’ competitor, Chick-Fil-A, charges $3.29 (Fast Food Menu Prices, 2019) for their chicken sandwich, which is 70 cents lower in price than Popeye’s chicken sandwich. It is clear that even though Chick-Fil-A is one of Popeye’s direct competitors and sells a similar product, customers were loyal to Popeyes’ product instead, despite the fact that the price is 70 cents higher. This proves that the sandwich is valued due to its taste and quality, which is why increasing the price will benefit the company. It will benefit the company through creating a profit for the company, and by raising it by a reasonable price will not heavily impact loyal customers, as they are essentially waiting for the relaunch to happen. Place Placement and distribution of the product is important, as we must ensure that the chicken sandwich is accessible to potential buyers. It is important to have the product accessible in all, (or at least in the most populated areas or areas appealing to target market), Popeyes locations, as it is one of the most popular foods on the menu. For example, Toronto is the capital city in Toronto and would therefore want the chicken sandwiches available in the Popeyes’s stores, since it reaches around 2.93 million residents and is a popular tourism spot (due to the location of the CN Tower). Promotion Popeye’s has been doing a great job gaining recognition from individuals through Twitter, which is what influenced individuals into buying their chicken sandwiches. However, it is important to note that memes and internet trends eventually fade away and become fads, which is a possible outcome for Popeye’s chicken sandwich. After relaunching the product, the high demand for the product and its popularity could be very short-lived, or a competitor could possibly come up with a marketing plan to drive individuals away from Popeye’s. Therefore, it would be a good idea to not only rely on the internet and Twitter, but also create another promotion strategy to attract customers. For example, building good public relations can benefit the business and its product greatly by attracting customers and convincing them to come back and make more purchases. Customer satisfaction through building sustainable relationships with individuals will lead to good reviews on the internet and more sales, as customers value respectful and kind employees. Crest Model Competition It is clear, based on empirical data, that Chick-Fil-A is not only our greatest, but tentatively our sole competition. During the Battle of the Chicken Sandwich of August 2019, a poll was conducted via Twitter, to establish the hierarchy of fast-food chains with respect to chicken sandwiches. The poll was held on Twitter by USA Today, in which people cast their votes over Twitter to declare a better chicken sandwich. As seen below, a s bracket was set up, pitting two competing restaurant brands against each other, with the winner to be cast by Twitter votes of loyal customers. The winner of the poll was Chik-fil-A, then Popeyes, then Wendy’s, and lastly KFC. To keep up with the newly branded Battle of the Chicken Sandwich Wendy’s attempted to throw in a bid, with a tweet that read:

3 “Y’all out here fighting about which of these fools has the second-best chicken sandwich. — WENDY'S SPICY NUGGETS ARE BACK!!! (@Wendy’s) August 19, 2019” (Easton, 2019) However, this proved ineffective against Popeyes new chicken Sandwich, the likes of which had seen recognition from the seemingly, widely accepted top-contender in the bracket; Chick-Fil-A. “In the first round, the top seed Chick-fil-A easily took down KFC with more than 80% of the vote. Meanwhile, chicken sandwich newcomer Popeyes vanquished Wendy's, capturing 69% of the vote, to set up the final round we all expected.” (USA Today Money, 2019) In the final round, Popeye’s saw itself pitted against the aforementioned Chick-Fil-A, with a social media campaign at its back, Popeyes was very close to unseating Chick-Fil-A, as the producer of the top chicken sandwich in the market. “54% of the 5,062 votes cast in our Twitter poll were for Atlanta-based Chick-fil-A and 46% for Popeyes Louisiana Kitchen.” (USA Today Money, 2019) “And the fast-food chain with the best fried chicken sandwich is . . .Chick-fil-A!” (USA Today Money, 2019) Moving forward, it seems clear that although most competitors have come forward with their own strategy to benefit from the “Battle of the Chicken Sandwich” the two leading in contenders are still Chick-Fil-A and Popeyes respectively. Popeyes will benefit from focusing in large part, it's resources towards direct marketing competition with Chick-Fil-A; to give the ‘rematch’ they want. Regulatory Due to the inherently fast-paced nature of the operations, ‘fast-food’ franchises often push the businesses to a regulatory extreme. This includes food quality, cleanliness and most notably, employment regulations. Being a multinational franchise, Popeye’s must comply with many individual regulators as it pertains to the quality of their ingredients, namely, the chicken. In Canada alone, Popeyes Louisiana Kitchen must comply with the Canadian Food Inspection Agency Act (1997), Feeds Regulations (1985) as well as the Safe Food for Canadians Act (2012). In the US, the namesake market, the franchise must comply with the US FDA, a seemingly stringent department of the US Department of Health and human services. With the increasing demand and popularity for Popeyes, the company will have to hold a larger inventory of product, especially chicken. This means that proper storage for the new influx of inventory (such as freezers and fridges) must be accounted for, as well as preparation methods that are approved. Additionally, to reduce the risk of overworking employees, supplemental workers should be hired to provide relief and allow all workers to work respectable hours; following the surge in demand for Popeye’s Chicken Sandwich, there has been an unquestionable strain put on the staff, leading to an immediate sound of concern from the many of the overworked employees; Many employees at Popeyes are working extra hours — some over 60 a week — to handle the demand. One employee said he was "working like a slave in the back" to fill sandwich orders during an 11-hour shift on Saturday (Taylor & Ciment, 2019) Moving into the future, Popeye’s will have to make sure that they put systems into place to prevent employees from experiencing exhaustion. Although, a chicken shortage is what ended the exponential demand for the sandwich, this does not mean that there is not another potential bottleneck; the capabilities employees and the realistic expectations therein. Popeyes stands to suffer another devastating setback, one that should be avoided, to maximize profits during the potential

4 Economic Popeyes chicken sandwich was previously priced at $3.99, being 14% higher than a chicken sandwich from Chik-fil-A, priced at $3.49, yet still sold 1000 sandwiches a day and accounted for 30% of total Popeyes sales while it was still available. Even though this product was offered at a premium price, the fact that the restaurant sold out of the item makes it evident there is economic strength and that consumers are willing a higher price for their food. This also shows that the purpose of Popeyes chicken sandwich isn’t to be cheaper, rather it is aiming at being the better choice. Concurrently, sales from Popeyes notably skyrocketed after the Twitter feud with Chik-fil-A, leading consumers to try the new sandwich, increasing popularity, and creating a surge for chicken sandwiches within the fast food industry. (Markets Insider, n,d.) Though the extraordinary demand for the chicken sandwich lead to the exhaustion of supplies, Popeyes is said to return bigger and better, with the chicken sandwich being permanently on the menu and not just seasonally. “Depending on how Popeyes handles the sandwich's return, "there will be a boost" to its business, Smallwood predicts” (Maynard, 2019). Popeyes already holds a valuable position in the minds of consumers, therefore with the right marketing used when the chicken sandwich returns the company is seen to create a second, and longer lasting boom in its industry. “About 92% of chicken sandwich buyers said they were ‘extremely’ or ‘somewhat likely’ to return to Popeyes to buy another sandwich, once it is back on sale” (Maynard, 2019). The loyalty of Popeyes customers along with the fact that 46% of Popeyes consumers have an annual income of about $80,000 or more makes it evident that when the sandwich does come back, consumers won’t be too worried about the pricing. Social/ Technological The publicity that the tweets received, made the sandwich a want for many individuals. “In terms of fast food franchises specifically, this limited availability strategy was likely first used by McDonald’s in order to market the Shamrock Shake in 1970 and, later, the McRib (which actually flopped when it was first introduced on the market, then became the subject of national clamor every time it was reintroduced sporadically throughout the 1980s and 1990s). But it wasn’t until the advent of social media that this stratagem truly gained widespread traction, with various case studies from KFC’s Double Down to Starbucks’ pumpkin spice latte” (Dickenson, 2019) Inherently the thrill is in the temporary nature of the deal as well as censorship or forbidden nature of the item. People get FOMO (Fear of Missing Out) on this item. Since there was so much discussion about the sandwich online, the shortage must have been unsettling for many that did not get to try it. People are choosing this good to fulfill their interest and curiosity with all the conversations that have evolved about the sandwich. Through Maslow’s hierarchy of needs, as Popeyes’ famous sandwich is a food item, it meets people’s physiological needs, as you need food in order to survive. However, since the sandwich was extremely popular, people wanted to buy it because of the influence of the media, which is then fulfilling people's esteem needs of feeling included and accepted by society. The public outreach that social media has is very instrumental to Popeyes’ success in launching the chicken sandwich. Popeyes was able to make it an international good that was highly sought out by many. In knowing that, Popeyes needs to use their global outreach to their advantage and continue to promote all products in hopes that another will go as viral as the last.

5 Conclusion/Recommendation In terms of the product it should remain the same. Through this viral tweet, Popeye’s has developed loyal customers. The product was enjoyed by many. Popeyes still has the opportunity to rectify what happened during the last launch. By taking this opportunity, and making sure that everything runs correctly, this shows customers that the company is evolving, and which will increase their loyalty. The main problem was the amount of supply. During the relaunch of the sandwich, we need to integrate a system that allows each store to count and determine the amount of stock they have after each transaction. In doing that, it will eliminate the potential of running out of inventory to produce the sandwich. Last time there was more demand than supply, and customers became outraged when they went to multiple Popeyes’ locations that had all run out of the sandwich fairly quickly. We need to make sure that all customers are satisfied, and to do that, we must make sure that there is enough supply so that all people who would like to purchase the sandwich, are able to do so. When it comes to price, we do believe that it would be beneficial to increase the price of the sandwich. The sandwich already holds value to many customers, that is why so many people went out to buy it. A slight increase in price will allow customers the comfort of knowing that they are paying for quality food. Also, that there will not be a shortage of supply in the relaunch. In the social aspect of the relaunch, it would be useful to use their social media platforms to announce it to those who were eager to purchase the sandwich during the previous launch. That way, Popeye’s is able to market to the old demographic, and also gain new customers through new social media viewers and followers. Social media has become very influential in many people’s lives, so it is a way to nationally reach customers. Through social media, also comes articles. When the relaunch is starting, we need to make sure that all the reviews are as positive as possible.

6 Appendix A SWOT ANALYSIS WEAKNESS

STRENGTHS 

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Developed social traction in regard to product An effective social media team The quality of the chicken sandwich The global outreach of the marketing campaign- Viral sensation Capable use of Twitter as advertising Recognizable brand name and logo Celebrities have advertised the chicken sandwich for free Recognizable brand name

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THREATS

OPPORTUNITIES  

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Global expansion frontier Global advertising from internet, sandwich going viral. Foreign consumers show interest Diversify chicken sandwich package with deals and promotions Chicken Sandwich can become flagship product of Popeye’s Brand can become more valuable from menu addition of chicken sandwich Entering Asian markets

The evaluation of product sales Preparation of inventory to keep up with demand Strong competition Viral promotion online may die out As a business lack of franchises, most being at gas stations. Weak online presence

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Since it became a global trend, other companies began advertising their idea of the perfect chicken sandwich Missed Revenue: Chicken shortage have caused many Popeyes locations to turn away customers and lose potential business. Negative press: people were causing scenes at Popeyes locations that had run out of the chicken. o “"I had customers nearly fight some of my coworkers because they were told that we were not serving the sandwich because we had run out," a manager at an East Coast Popeyes said.” (Ciment & Taylor, 2019) People were excited then outraged because the sandwich had sold out in various locations. Highly competitive category (fast food) Customers are becoming more health conscious

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Ability to build off previous momentum of chicken sandwich

References

8 Dickenson, Ej. [The Rolling Stone]. (September 3, 2019) The Human Costs of Viral Food Crazes. Retrieved from https://www.rollingstone.com/culture/culture-news/popeyeschicken-sandwich-viral-food-craze-cancelled-879220/ Easton, Chloe. (August 26, 2019). Popeye’s Chicken Sandwich, is it worth the hype? U-Wire. Retrieved from Factiva. Fast Food Chicken Prices from KFC, Popeyes, and Chick-fil-A. (2019, March 28). Retrieved from https://www.fastfoodmenuprices.com/fast-food-chicken-prices-from-kfc-popeyesand-chick-fil-a/. Here's why the new Popeyes chicken sandwich is proof the US economy is doing just fine | Markets Insider. (n.d.). Retrieved from https://markets.businessinsider.com/news/stocks/why-new-popeyes-chicken-sandwich-issign-of-economic-strength-2019-8-1028464389. Maynard, M. (2019, August 28). Popeyes Chicken Sandwich, Now A Sell-Out, Is A $65 Million Marketing Win. Retrieved from https://www.forbes.com/sites/michelinemaynard/2019/08/28/the-popeyes-chickensandwich-now-sold-out-is-a-65-million-marketing-win/#f1944cf79d60. Maynard, M. (2019, October 3). Who Bought The Popeyes Chicken Sandwich - And Will They Be Back When It Returns? Retrieved from https://www.forbes.com/sites/michelinemaynard/2019/10/03/who-bought-the-popeyeschicken-sandwich--and-will-they-be-back-when-it-returns/#166b4f581eca. Molina, Brett & Tyco, Kelly. (August 26, 2019). America's best chicken sandwich: Is the winner of our poll, Popeyes or Chick-fil-A? USA Today Online. Retrieved from Factiva. Omnicore. (2019, September 5). Twitter by the Numbers: Stats, Demographics & Fun Facts. Retrieved from https...