In a very unsurprising development, Advertising Age reports
that Friendly’s, the phantom
restaurant chain will be filing for bankrupcy “as early as next week”
One reads these news and one can’t help wondering… is it
stupidity? Blindness? Arrogance? Ineptitude? A cocktail of all of these factors
and many more?
Because sometimes I am under the impression that companies
like this are brought down by their own marketing team. Death by “Friendly Fire”
as it were.
The chain plans to continue it’s “High Five” campaign. Their
measured media spend, an anemic $7.3 million in 2009 (Kantar) was tracked at a
still anemic $10.3 million in 2010). No word on 2011.
Let’s look at their
top management:
1. Self Delusion:
"People love our brand, but
we've kind of lost relevance,"
Chief Marketing Officer Andrea McKenna told Ad Age last month.
2. Ineptitude: "People's
lifestyles have changed, and they've gotten busy." CMO McKenna continued. To which one can only respond: no kidding.
3. More ineptitude:
Friendly's spokeswoman Maura Tobias told Ad Age via email that the chain plans
to continue the new campaign moving forward.
4. Irrelevance: In
2010 the company had $596.8 million in sales and dedicated $10.3 million in
advertising. This is an anorexic 1.72% of sales dedicated to advertising. A
quick search of Ad/Sales ratios shows that all “eating places” spend 2.2% of
sales in advertising –down from 2.7% in 2010 (Shonfeld Associates). The same
source shows “Eating and Drinking Places” as having an ad/sales ratio of 10.2%.
5. Even more
ineptitude: In 2011, after 6 years of declining sales (Technomic) and
decreasing stores (492 units in 2010, down 3%) Friendly’s finally introduced a
“value menu” called High Five with 5 items for $5.00. Effectively killing their margin.
So how do they advertise their margin-killing “High Five”
menu?
- Show the product?
- Big price?
- Show the product AND a big price?
Nope. See for yourself.
Because consumers don’t want to see the food. Or the price.
McDonald’s conclusive proved that point.
Oh, no, consumers want to zip by some boring billboard, rip
their eyes off their iPhone and Blackberries (and Androids) and try to figure
out what the hell the billboard is saying… and then they react: “Oh, honey, listen, let’s not stop by any of
the 15,000 convenient McD’s, let’s go out of our way to find a Friendly’s and
reward them for appealing to our intellect with a campaign that dares us to
guess what the hell they’re talking about”
Find your keys, indeed!
My quick 2 cents to Ms. McKenna (their CMO) and Harsha Agadi, their new CEO with the
ambitious goal of getting to $1bn in sales:
- Get rid of
your entire marketing team; they destroyed your company. You are now going into
Chapter 11 because of their lack of hindsight, foresight, insights and
everything-sight.
- Go out and
talk to consumers. It’s a wild guess, but I’m fairly sure that your marketing
team (including the agency) haven’t spoken to a real consumer in half a decade
or they would have never created the silly “you found your keys” campaign
- Close the
lowest performing 25% of the stores
- Over-spend
on the top 25%
- Explain to
the middle 50%’s management that they are fighting for their lives.
- Learn from
Starbucks: consolidate your geographical presence to achieve a pocket of dominance.
What’s your lonely store in North Miami doing for you? Really?
- Invest in
search. I typed “Friendly’s” and instead of getting at least some restaurants
near me, I get your going into bankrupcy.
- Invest in
the web. My wife and I go out once or twice per week. We didn’t even know there
was one of you near us
- Drop
television. There’s no way you are going to compete against McD, Denny’s or
anything in that range. If you are spending $10 or $11mm your creative can’t be
at their level.
- Go heavy
into radio (after web)
- Show the
product; what’s this “you found your keys” nonsense? Really? Are you a car
dealership? Show me the product
- Show the
price
