Applebee's and IHOP each returned to positive same-store sales in 2018. - Mike Mozart / <a href=''>Flickr</a> Applebee's and IHOP each returned to positive same-store sales in 2018. - Mike Mozart / <a href=''>Flickr</a>

Applebee’s and IHOP Plot an Inspired Tech Turnaround by 2022

A steady diet of marketing and promotions returned Dine Brands’ subsidiaries Applebee’s and IHOP to early 2016 sales levels last year. But the restaurant group is keen on upping its technology game, to match its marketing exploits, and keep diners coming back.

Since CEO Stephen Joyce’s arrival to Dine Brands in the summer of 2017, both chains have introduced new tools to reduce customer pain points in restaurant, including server tablets for order accuracy, and wireless credit card readers that allow diners to pay for meals faster.

The measures, in part, led to a large turnaround in same-store sales for Applebee’s and IHOP last year. Yet the restaurant group believes it has a ways to go. Its goal is to reach the levels of what Joyce thinks is the biggest digital player in the industry — Domino’s.

“We have a three-year plan to match what Domino’s can do because we need to get to one-on-one marketing. But right now, the formula is working. We’re doing interesting food promotions, a lot of value orientation,” Joyce said, during an onstage interview with analysts at J.P. Morgan’s Gaming, Lodging, Restaurant & Leisure Forum. “We also looked at Panera Bread, who’s pretty good.”

Technological Inspiration

Joyce offered no additional details on the intricacies of Dine Brands’ three-year technology growth plan, though a look to his inspiration could signify where the chain is heading.

Over the past year, Domino’s has introduced new capabilities, such as delivering pizzas to customers without an address, via “Domino’s Hotspots,” as well as voice recognition software to take phone orders. These initiatives, largely intended to make a marketing splash, speak to Domino’s larger strategy of inserting itself into popular culture at every turn.

Similarly, Panera Bread is highly commended for its consumer app, which offers functionality similar to Domino’s app. Last month, at the New York Hospitality Alliance’s State of the Industry Conference, Bloomberg Intelligence Consumer Analyst Michael Halen said Panera Bread’s app is the best among privately-held restaurants. It’s also been lauded for in-restaurant technology and its success in delivery while maintaining in entirely in-house delivery operation.

Applebee’s and IHOP customers will continue seeing promotions that have worked well for the chains while Dine Brands bolsters its tech, Joyce added. The latter, aided by its IHOB marketing stunt, saw same-store sales increase by 1.5 percent after a 1.9 percent decline in 2017. Meanwhile, Applebee’s Neighborhood Drink promotions, which began in October 2017, led to a 5 percent jump in same-store sales in 2018 compared to a 5.3 percent decline the year prior.

“Everybody says, well, how long can the [Applebee’s] Neighborhood Drink promotion last? Well, it’s not about the Neighborhood Drink promotion, that’s only part of it,” said Joyce. “We’re doing dramatically improved levels of technology. We’re removing obstacles from the customer.”

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