Popeye's 2004 Annual Report Download - page 9

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(Top to bottom)
3pc Chicken Combo,
Popeyes Naked Chicken
StripsTM, Southwest
Shrimp and Garden Salad
with Popeyes Naked
Chicken StripsTM
What are the biggest challenges for Popeyes in the year ahead?
First, we must continue strengthening our base concept. Our economic
model must be as strong as possible. Clearly, when we have strong
restaurant economics, the system growth we seek will occur much more
quickly. Secondly, now that we are once again developing franchises
domestically, we have to approach the process as if it were the first time.
We did not sell domestic franchises for almost 14 months; however, we used
that time to improve the sales and development process. Inquiries are
increasing and agreements are being signed. I think we will see steady
progress through 2005, driving toward a much stronger 2006.
What are the biggest opportunities in the year ahead for Popeyes?
We have great opportunities to build frequency. Popeyes has a larger pool of
customers than most hamburger restaurants because of the size of our trade
areas. We know that the visit frequency of chicken QSR is about half that of
hamburger QSR in terms of average visits per month. That means we have a
very large pool of customers who love to come to us for our bone-in chicken
and unique sides, but they have not discovered other reasons to visit us. We
have a great opportunity with some of the menu initiatives currently being
tested to really build frequency. I believe very strongly that it is much easier
to convince a current loyal customer to visit more frequently than to go out
and find people who are not aware of the brand and try to convince them to
come in for the first time.
What are some of those menu initiatives?
A key initiative for the brand is the development of boneless products.
Our Popeyes Naked Chicken StripsTM product line — which was successfully
launched in January 2005 creating a strong demand from consumers — is
a great example of the products we will bring forward in the boneless arena.
We are already making great strides. Second among our menu initiatives is
the brand’s commitment to providing “better for you” alternatives. We are call-
ing this initiative “Healthy Matters” and it includes testing new and improved
salads, wraps, and working with our ingredients and our current products to
improve their wholesomeness and healthiness. With these improvements, I
feel confident that frequency among our current guests and traffic during
lunch and snack day-parts from new customers will increase. Third, we are in
the process of strengthening our lunch sandwiches, and have several great
tasting test products that should provide lunch customers a reason to visit
Popeyes for lunch more often. Once a strong base sandwich program is in
place, it will provide a great platform for sandwich LTOs (limited time offers),
which can have a significant impact on our effort to increase visit frequency.
What will Popeyes look like a year from now?
I believe Popeyes will continue to become a stronger brand over the next
12 months. By working with our operators, I expect 2006 will bring alignment
to brand communications, a larger re-image presence in our existing markets,
a menu that is more consistent and relevant to our customers, operations
that are responsive to what our guests expect, and a business that provides
stronger sales and profits to our franchisees. I am excited about the potential
for the coming years and believe strongly that Popeyes is poised for
accelerated growth and brand enhancement.