Anti-Obamacare rhetoric from Papa John’s CEO and a major Applebee’s franchise owner appear to have driven down both chains’ consumer perception with casual dining eaters in the US, and are still impacted two weeks after those remarks were made.
Papa John’s CEO John Schnatter’s post-Election Day comments about passing on health care reform costs by reducing worker hours and raising prices coincides with a swift negative reaction among casual food diners seemingly accelerated by the November 13th class action lawsuit accusing Papa John's of sending unsolicited text messages to customers.
Despite Schnatter’s Huffington Post op-ed on November 20th claiming his words were twisted, Papa John’s perception levels continued to experience one of its sharpest drops of the year, sending it well below rival Pizza Hut.
Zane Tankel, the CEO of Applebee’s franchisee Apple-Metro, appeared on Business News and made similar comments, saying Obamacare would force him not to hire any more workers and consider cutting their hours. Applebee’s perception had dropped since his TV appearance.
One exception to these two examples is Denny’s. Franchisee John Metz, who runs 40 locations, said in mid-November that he would add a 5% surcharge to customers' bills and reduce his employees' hours. Denny’s perception with casual diners declined afterwards, but much less so than Papa John’s and Applebee’s. However unlike those two chains, Denny’s has since rebounded close to where they were before Metz’s remarks, potentially due to CEO John Miller’s apologetic statement a few days later.
Papa John’s, Applebee’s, and Denny’s were measured with YouGov BrandIndex’s Buzz score, which asks respondents, "If you've heard anything about the brand in the last two weeks, through advertising, news or word of mouth, was it positive or negative?" Results were filtered adults 18+ who have eaten at casual dining restaurants in the past month.
Papa John’s Buzz score high point for the month came on Election Day – November 6th – with a score of 32. Eight days later, the score had dropped 10 points down to 22, when the spam text lawsuit was unveiled. A few days later, Papa John’s dropped below Pizza Hut’s score and is presently at 4.
Applebee’s had a 35 Buzz score on the eve of Election Day, when a few days later, Apple-Metro CEO Zane Tankel told Fox Business News he won’t build more restaurants or hire more people. By November 17th, Applebee’s score had fallen 20 points. As of this past Thursday, their score was 5.
After Denny’s franchisee John Metz’s Obamacare comments on November 17th, the chain’s buzz score dropped from 10 down to zero nine days later. However, they have since bounced back to 6, a higher score than both Papa John’s and Applebee’s.