The latest, biggest, new idea for the Applebee’s chain of restaurants did not come from its marketing research or R&D department. It came from customers. And the restaurant is happy to take the idea and run with it.
When a few customers, enjoying late night hours at a local Applebee’s in central Florida, started calling their hangout “Club Applebee,” the chain recognized it had a new option for attracting patrons. Approximately 100 of the restaurants now stay open late and entice adult customers with trivia games, karaoke nights, and even a luau or two. They also offer discounts on appetizers and drink specials.
Drink specials are not unusual in the restaurant industry. Many other competitive chains offer such promotions as well, such as Buffalo Wild Wings or TGI Friday’s. For most food establishments, alcohol is the most profitable item they sell, even with discounted specials. In addition, few people visit bars alone, so even if one customer purchases the discounted special, his or her friends are likely to choose other, more profitable options.
Although Club Applebee’s locations have enjoyed great success thus far, the chain is hesitant to take the notion nationwide. Although approximately 80 percent of the restaurants are open late, not all of them tout “Full Moon Black Light” parties. The reason may have something to do with Applebee’s long-running marketing communications. For years, advertisements have touted Applebee’s as neighborhood spots, where families can share a meal and baseball teams can celebrate their trophy. Parents might be less inclined to stop by if they confront evidence of the party that took place the night before.
- Why is Club Applebee’s mainly a service provider?
- What kind of extension is Club Applebee’s for the Applebee’s chain?
Source: Maureen Morrison, “The Hottest New Joint in Town Is Club Applebee’s,” Advertising Age, August 6, 2012
In my mind, I view this as a market development growth strategy because they have always been open late and served drinks, but they are just beginning to promote it in this way in order to reach new customers. Although this type of growth is less risky than a diversification growth strategy, I am still concerned for their ability to balance their family appeal while trying harder to attract a night-time crowd. I think in the end though Applebee’s is on the right track though for further expansion to a larger market.
C Arias said:
Club Applebee’s is mainly a service provider because it merely offers late night karaoke, trivia games, and luau, and allows for longer nights. These are all services and not products. The type of extension that was used by Applebee’s was market development since they are targeting adult customers who are looking for a new hangout spot, while they seek to maintain families and teams as customers.