Growth Pillars Help Popeyes Exceed Expectations


Popeyes Louisiana Chicken

Popeyes Louisiana Chicken has found ways to overcome the sluggishness that afflicts much of the rest of the fast food world—and it doesn’t just involve being one of the favorite forbidden treats of the Kardashian clan.

The company is combining menu flexibility and innovation with savvy promotional tactics, strong customer service and a digital technology push to defy the QSR blues and continue to log impressive growth. Global and domestic same-store sales increased again during the first quarter, albeit not at the stronger pace of last year.

And Popeyes is far from finished exceeding the industry norm. “Over the next seven years, we plan to drive our domestic restaurant average unit [sales] volume from approximately $1.4 million to $2 million,” CEO Cheryl Bachelder said this week on a conference call, achievement of which would drive up franchisee profits. And she plans to continue to expand the brand globally by increasing the Popeyes restaurant count to about 4,000 restaurants from about 2,500 now.

“The outlook for this brand is strong,” Bachelder said.

To be sure, Popeyes has been enjoying a 15-minute type of fame per the Kardashian family since member Kylie Jenner vulgarly compared eating a Popeyes biscuit with another physical activity in a Snapchat video last year. Just last month, Khloe and Kourtney Kardashian added to the brood’s buzz-building promotions of the brand with an Instagram pic showing them consuming Popeyes on a private jet on a “cheat day” of eating.

Popeyes Louisiana Chicken Kardasians

But fortunately, Popeyes also leans on some other fundamentals for its success. One of them is a menu of flavorful traditional spicy foods and Louisiana culinary roux. In the first quarter, new products included Spice Packed Wings and Cajun Surf & Turf, but Popeyes also activated value pricing on its core chicken menu to counter burger-chain discounts, Bachelder said.

A just-launched limited-time item is Magnolia Blossom Chicken, which is cut to resemble the petals of the Louisiana state flower and marinated with a blend of sweet orange flavors.

Second, a “passionate team” is a strategic pillar for Popeyes, Bachelder said, because such employees “deliver a superior guest experience that yields more loyal guests that spend more money, which drives sales and profits for our owners. A third fundamental is what she called “routine excellence” on each customer’s visit.

And so far, she told Wall Street maven Jim Kramer, Popeyes has been able to get more out of its workers without having to raise wages significantly, as some other fast fodder chains have begun to do in the wake of political pressure, union protests and marketplace indicators that they needed to hike pay.

“We’ve got to be careful about not moving on wages too quickly,” she said. “For our guests we want fair prices and for our people we want fair employment opportunities and fair wages.” That calls for “caution and conservatism on how fast we go on wage rates so that we can keep the economy thriving and give the best opportunities to our guests.”

Boosting the use of digital technology is both one antidote to wage pressures as well as a way to boost the customer experience further. Popeyes is available for delivery via Postmates in New York City, for instance. And the chain is working on what Bachelder called “a unified technology platform that will transform how we operate our restaurants, communicate with our team members and interact with our guests.”