Bloomberg Businessweek: Club Applebee's? - Experimenting with the Bar/Club Scene

From Bloomberg Businessweek:

In July, Nick Pirrone and three friends were driving home from a St. Louis Cardinals game when they stopped at an Applebee’s in St. Charles, Mo., for dinner. It was after 10 p.m., and when the teenagers walked into the casual dining restaurant, they didn’t find the traditional family-friendly atmosphere they’d grown up with. Instead, they found a karaoke bar. “There were a lot of people drinking and singing Backstreet Boys,” says Pirrone, who is 18. “The place was packed. There was even a DJ.” The four ate half-price appetizers and were so amused by the revelry that they returned a few weeks later with a group of 14. “It was actually kind of fun,” Pirrone explains. “I mean, there’s not much else to do around here. It’s the suburbs.”

For the past few years, Applebee’s has quietly been experimenting with a late-night bar and club scene at restaurants around the country. Some, such as the one Pirrone visited in St. Charles, offer karaoke and trivia nights. Others have fashioned themselves into nightclubs where patrons can gobble spinach and artichoke dip under the Day-Glo beauty of black lights. On Aug. 27 the restaurant chain will take its after-hours makeover national, reimagining itself as a destination called bee’s Late Night, where the Bahama Mama cocktails flow and the lights strobe until 2 a.m.

“Remember when McDonald’s used to be called Mickey D’s?” asks Becky Johnson, a senior vice president at Applebee’s. “That was a street slang term, people playing with the name. We found out that ‘the bee’s’ is how the kids are describing Applebee’s.” By “kids,” she means twenty- and thirtysomething singles who may eat at Applebee’s with co-workers or family members, but who generally go elsewhere—like, to an actual bar—at night and on the weekends. “The bee’s is an overt invitation to them,” says Johnson. “We want them back.”

Until recently, most of Applebee’s 1,870 U.S. locations closed shop at 10 p.m. This is typical for casual dining chains: Chili’s and Ruby Tuesdays usually call it quits around that time, too. TGI Friday’s, originally a singles hangout, tends to stay open later. Applebee’s became known as a place where parents could bring their children and, as Johnson puts it, “you’d walk in, they’d put a balloon on the highchair, and everything was wonderful.” But a lot of other restaurants had that same image; it’s hard to tell one basket of chicken fingers from another.

In 2009 several franchise owners approached Applebee’s parent company, DineEquity, a California-based restaurant group that bought the brand in 2007 and also runs IHOP, for permission to extend their hours. They’d been studying customers’ habits, they said, and noticed that younger adults were eating later. This was in the middle of the recession, and if Applebee’s kept its doors open longer, it might attract new customers. DineEquity enthusiastically agreed. Along with a menu overhaul and more franchise ownership, DineEquity credits its growing late-night scene with helping boost Applebee’s same-store sales two years in a row.

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To read more visit Bloomberg Businessweek.


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