1. Backlash for Burger King
Marketing boundaries were stretched for restaurants this week when the Home of the Whopper demonstrated a breakthrough way to trick a third party into plugging BK’s signature sandwich. A new 15-second commercial delivered a voice command to Google Home, the search engine's virtual assistant, prompting the device to retrieve and recite information about the Whopper from Wikipedia.
Picture the scene: You’ve turned on the TV in the next room while scurrying around the kitchen to make coffee. All of a sudden, your Google Home device starts reciting the sandwich’s features, scaring you to death, because you didn’t hear the BK prompt. But your robotic device did.
Home users didn’t like the trick, and let Google know as much. The tech giant indicated it wasn’t involved in the ploy, and the commercial’s mention of “Whopper” suddenly stopped triggering a recitation of the sandwich’s features.
But marketers and consumers were given a glimpse of a breakthrough new way of sounding a commercial message inside American homes, when would-be patrons might not have their mental screens raised.
2. About-face on Chipotle’s Tasty Made?
After the about-faces of recent weeks, and a big one possibly coming in days, Chipotle could switch its logo to a U-turn sign.
It recently reversed a long-standing aversion to conventional marketing techniques to launch its first-ever national TV ad campaign. Similarly, it decided not to proceed with the rollout of a second concept, ShopHouse Southeast Asian Kitchen, and has not yet opened scheduled additions to its Pizzeria Locale and Tasty Made Burger ventures.
Now come questions about the future of Tasty Made. Mark Kalinowski, restaurant analyst for Nomura/Instinet, speculated this week that the better-burger concept could be scrapped or spun off following the departure of the divestiture’s godfather, Director of Operations David Christman, to a manufacturing company.
On a happier note, the Chipotle chain is heading for a dramatic reversal of its same-store sales trend. Kalinowski and other restaurant analysts expect the brand to post a comp gain for its next quarter of at least 15%, compared with a prior-quarter figure of -29%. Unfortunately, much of the leap is the result of comparisons with the prior year, when sales were in a freefall.
3. Taco Bell rethinks delivery
The quick-service giant isn’t doing an about-face on plans to follow the rest of the chain segment into delivery, but it’s certainly changing its approach to getting there.
Niccol indicated that the problem was the degradation of product quality, which made the customer’s experiences only okay. “OK usually ends in a slow death,” he said.
4. Walking back a second bid for Panera
For about 15 minutes, all signs pointed to a restaurant bidding war of Goliath proportions. A lone New York City tabloid reported that 3G Capital, the Brazilian fund that once wholly owned Burger King, was mounting a last-minute bid that would top JAB Holding’s $7.5 billion offer for Panera Bread Co.
3G is still a principal owner of Restaurant Brands International, the parent of BK, Tim Hortons and, soon, Popeyes. One of its main investors is Warren Buffett, the owner of Dairy Queen. Suddenly, the fast-food landscape would have been scrambled again.
The New York Post story was based on unnamed sources, but it provided nitty-gritty details. For instance, the article said Panera was prepared to pay JAB a $215 million fee for breaking the sales agreement.
Within hours of the story’s online appearance, all stakeholders, including 3G, said the report was categorically untrue, and the issue was dropped. But the flurry of excitement delivered a lesson of sorts: In today’s bidding for restaurant chains, an offer topping $7.5 billion is no longer unbelievable.
5. Utah’s puritanical move
We’re stretching the calendar a bit to include a reversal from two weeks ago that should have had full-service operations gulping antacids and picketing their statehouses, regardless of where they operate. Yet the industry seems to have barely noticed.
After tentatively loosening up restrictions in recent years on selling alcoholic beverages in restaurants, Utah pulled a dramatic 180 by changing the definition of driving under the influence. The state became the first in the nation to lower the legal threshold to the point that a single drink would take an imbiber to the limit. The implication, of course, is that restaurant patrons will severely cut back on wine and cocktail purchases to avoid any risk of being legally drunk while behind the wheel.
The questions are: Will other states follow, and what are restaurants doing today to ensure the answer is “no”?