Popeyes

Jul 27, 2020 | Report Announcements

Popeyes’ brand positioning around a unique, flavorful Louisiana heritage (slow cooking, served fast) provides the brand permission to extend its menu beyond bone-in chicken. Its core bone-in chicken is infused with a Louisiana-inspired seasoning dry rub that is applied to fresh chicken which marinates for 12 – 72 hours and is then hand-breaded. The brand’s resounding social media marketing success around its new chicken sandwich continues to be the talk of the town, allowing Popeyes’ to move to a new level as this product has greatly extended its reach by attracting younger, more affluent customers from larger households along with a higher percentage of women. Notably, Popeyes often ascends to the top of a guest’s preference list within the QSR chicken segment once they have tried its sandwich. It is also notable that its chicken sandwich trial has driven growth in bone-in, boneless & seafood. Further, recent sales have benefit from Popeyes’ historic strength in family bundle home meal replacement (which works well in the current operating environment) and the chain’s value equation built upon layered price point promotions. All of this has translated into a 1Q20 comp increase of +29.2% after 2019 comp growth of +13% with performance also benefitting from fast growth in digital & delivery. However, while Popeyes’ sandwich sales appear to be sustaining, continued system growth may be largely dependent on this trend. Also, Popeyes faces stiff chicken sandwich competition and its huge success with this product line is likely to attract even more competition. In conclusion, while Popeyes’ eye-popping success with its chicken sandwich has helped the brand to showcase its unique, core Louisiana positioning to a greatly extended audience, it remains to be seen how well the brand will leverage this opportunity against a back-drop of growing competition.

 

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