Question

1. What target market did Applebee’s pursue in its recent overhaul? In what ways did Applebee’s attempt to appeal to this group?

2. How did Applebee’s comprehensive business transformation alienate Baby Boomers and Gen-Xers?

3. Why was Applebee’s marketing strategy unsuccessful in attracting Millennials as well as retaining its core customer base?

Video Source: “The Real Reason Applebee’s is Struggling,” Mashed, July 2, 2018, https://www.youtube.com/watch?v=taE9o9Uz5MI

Answer 1

(1)

In Applebee’s recent overhaul they decided to pursue Millennials as their target market. Referring to the 5-step process to selecting a target market. “Step 1 is identifying the appropriate targeting strategy. Step 2 is determining which segmentation variables to use. Step 3 Developing market segment profiles. Step 4 evaluating relevant market segments. Step 5 selecting specific target markets. They decided to develop a new target market and we can assume they followed this 5-step process. They attempted to appeal to this group by redesigning their locations, kitchens were overhauled, and the menus looked completely different. They also tried adding trendy food options such as brisket nachos and sweet potato fries, according to the video.

(2)

Initially Applebee’s did not intend to alienate Baby Boomers and Gen-Xers, but never the less they did. They didn’t just alienate the Baby Boomers and Gen-Xers, they failed to get Millennials in the restaurant as well. They changed their menus and their food didn’t live up to the pictures on the menu, it was an expectation versus reality moment for Applebee’s and that is unappealing to most people. Also, every Applebee’s menu is the same and that can-do damage in the market. People will expect different food at different places depending on which foods are locally grown and could be used to spice up the menu and bring in customers. Overall, the changes to the menu and the locations (and the changes that have not been made but should be made) have alienated their past target market generations.

(3)

There were many reasons the Applebee’s marketing strategy was unsuccessful in attracting Millennials as well as retaining its core customer base. One reason is that every Applebee’s in the U.S. has the same exact menu, that means there is no intent for customers to come back or try new locations because they can’t expect regional food variations. Another reason is because of their caloric overload. Their food contains extremely high calorie marks as well as high sodium levels. Even thier oriental grilled chicken salad has 1,310 calories and a whopping 2,230 mg of sodium. This is unappealing to their target markets especially because people across the U.S. have been on health trends and have been trying to live healthier life styles. Finally, the last reason is because they have poor servers and poor management. They have had issues with servers complaining on social media about receiving no tip and that has been a big controversy. Also, they have had many allegations of sexual harassment and Applebee’s has done a lot to mask the problems instead of addressing it and taking action. This is alarming to potential customers.

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