Applebee’s Neighborhood Grill and Bar has been in a prolonged sales slump for five consecutive quarters, which must have hit the casual dining giant hard, considering its previous five consecutive quarters of gains that ended abruptly in mid-2015.

1. NEW BUSINESS PITCH
See you tomorrow
January 2017

2. NAME BRAND PITCH TYPE
Creative
MARKET DATE
December 15 , 2016
The Data You Need to Win This Pitch
DESCRIPTION
Applebee's is stuck in a prolonged sales slump and is, once again, searching for a new creative agency after working with Barkley for less than a year.
Changes in leadership and new advertising and communications agency relationships have not ignited sales at Applebee's Neighborhood . Applebee's
is owned by DineEquity Inc., which also owns the IHOP chain, and is the country's largest casual dining chain with nearly 1,900 U.S. restaurants.
Applebee's sales at longstanding U.S. locations have declined in the first three quarters of 2016 following declines in the third and fourth quarters of
2015. Such sales have now fallen in five consecutive quarters after five consecutive quarters of gains that came to a halt in mid-2015.
Applebee's is Searching
for a Creative Agency,
again.
th
U.S.

3. Client Profile / Market
Applebee’s International, Inc., is an American company which develops, franchises,
and operates the Applebee's Neighborhood Grill and Bar restaurant chain.
As of December 2015, there were 2,033 restaurants operating system-wide in the
United States, one U.S. territory (Puerto Rico) and 15 other countries, all owned and
operated by franchisees. The company is headquartered in Kansas City, Missouri
after moving from Lenexa, Kansas in September 2011. On September 3, 2015, it was
announced that owner DineEquity would be consolidating its headquarters for
Applebee's and IHOP to DineEquity's Glendale, California location. As a result,
President Steven R. Layt chose not to relocate and resigned effective September 4,
2015.
The Applebee's concept focuses on casual dining, with mainstream American dishes
such as salads, shrimp, chicken, pasta, and "riblets" (which is considered Applebee's
signature dish). All Applebee's restaurants feature a bar area and serve alcoholic
beverages (except where prohibited by law).
FINANCIAL OVERVIEW
- Source: AccessConfidential.com -
COMPANY BACKGROUND
MAIN COMPETITORS
2015 Sales (mil)
2015 Employees
Employee Growth Percent
Assets (mil)
Net Income Growth Percent
Sales Growth Percent
4,700
33,595
-
-
-
+4%
Mr. Darin P. Dugan
Senior Vice President,
Marketing and Culinary
Ms. Mindee (Elam) Plugues
Vice President of Marketing
Communications, Applebees
DECISION MAKERS by
mindee.plugues@applebees.com
(913) 890-0767

4. Casual Dining in the U.S.
$ 58B
TOTAL
CASUAL
DINING
SALES
- Technomic -
TOP CASUAL DINING CHAINS
CHAIN NAME 2015 U.S. SALES ($000) 2015 U.S. UNITS
Applebee’s 4,739,442 1,878
Olive Garden 3,743,000 841
Buffalo Wild Wings 3,567,155 1,145
3.5%
SALES
GROWTH
- Technomic -

5. Casual Dining in the U.S.
11,894Total Casual Dining
Units in the U.S.
+1.5%Unit Growth
In 2015
$4.4MAverage Estimated
Sales Per Unit in 2015
- NRN.com -
- NRN.com -
- NRN.com -
TOP & WORST
% Sales Growth
+16.3%
-3.7%
Estimated Sales Per Unit
$11.3 Million
$1.7 Million

6. Casual Dining in the U.S.
Casual Dining is losing shares to other segments
like Limited Service Restaurants.
Sports Bar concepts, steak specialists and brands
with a contemporary adult beverage programs
tend to lead the Casual Dining segment’s growth.
Restaurant
visits
In 2015
90%
Other Restaurants
10%
Casual dinners
2%
Casual Dining
Restaurants
visits drop
$7.5b
SALES
+8.1%
SALES GROWTH
2,676
UNITS
+4.3%
UNITS GROWTH
SPORTS BARS PERFORMANCE IN 2015

7. A Closer Look at the Casual Diner
ONCE A WEEK OR MORE OFTEN
49%
45%
38%
49%
HISPANIC WHITE AFRICAN AMERICAN ASIAN
FREQUENCY BY ETHNICITY
45%
Americans eat at a Casual
Dining Restaurant at least
once a week or more.
Thinknow Research
Statista.com
Thinknow Research
Statista.com
74.1% $13.75
60% 40%
Consumers choose
casual dining restaurants
for dinner
Average eater check
of Asian casual dining
visitors go to spend time
with the family
Casual dining consumers
visit upscale casual dining
restaurants at least once a
month

8. Consumer Picks
NRN.com
NRN’s Consumer Picks Report
ranks casual dinner chains by
consumers’ ratings over 10
attributes including: Food
Quality, Cleanliness, Service
and Atmosphere.
The overall score is weighted
by the importance customers
place on each attribute.
1 The Cheesecake Factory Varied Menu 74.2
2 The Melting Pot Varied Menu 73
3 Bonefish Grill Seafood 71.7
4 Red Lobster Seafood 71.1
5 Romano’s Macaroni Grill Italian / Pizza 70.5
RANK CHAIN SEGMENT OVERALL SCORE

9. Sales 2015
$2,5 M
Average Sales
Per Unit
Stats: Applebee’s
1,860
Outlets in
the US
% change
$4.7B +4%

10. Applebee’s Rated by Consumers
NRN.com
Consumers Rating
(NRN Consumer Picks Report)
Rank 31
Overall Score 58.8
Food Quality 65.7
Value 45.5
Cleanliness 62.1
Service 61.1
Manu Variety 63.4
Reputation 60.1
Atmosphere 58
Craveability 46.9
Likely to Recommend 62.4
Likely to Return 56.1
One reason DineEquity has said
Applebee’s is having trouble is
that consumers aren’t
perceiving as much value
Same-store sales decline in the
3Q 2016
5 straight quarter of
same-store sales

11. Applebee’s Playing With Fire
Applebee's installed new
wood-fired grills across
every single location
across America.
Applebee's is converting
to USDA Choice steaks
and is hand cutting them
in house on a daily basis.
The move changed the
flavor and taste profile of
40% of menu items
Investment on
the initiative
(including advertising spending)
$75M

12. Fast Food industry in numbersTaking on Delivery
In May ‘16, Applebee's and SkipTheDishes, North America's fastest
growing food delivery networks, announced an official nationwide
delivery partnership.
For the first time, select Applebee's restaurants will begin offering
delivery with live GPS tracking in major cities across North America,
with plans to expand to additional cities in coming months.
Working with a third party delivery service has been found to raise
restaurant sales volume by 10% to 20%.
AMERICANS AND FOOD DELIVERY
51%
26%
300%
Americans use delivery services to purchase
meals from casual dining restaurant.
Order takeout or delivery at least once a week
Growth of digital ordering and delivery
compared to dine-in traffic since 2014.

13. CASUAL DINING
RESTAURANTS
CONSUMERS
QUICK DEFINITION:
Casual Dining Restaurant Consumers
Our Casual Dining Restaurants Consumers demographic
refers to consumers eating at Applebee’s’ top competitors,
like Olive Garden, Buffalo Wild Wings, Chili’s Grill & Bar and
Outback Steakhouse.
We’ve excluded Applebee’s fans in order to better highlight
the differences between Applebee’s current fans and the
consumers buying the competition.
10%
20%
0
30%
13-17
• • •
•••
18-24 25-34 35-44 45-54 55-64
55%
FEMALE
50%
MARRIED
43%
WITH
CHILDREN
FOODIES
177.8
MOTOR
LOVERS
139.7
FASHION
LOVERS
133.4
BEAUTY &
WELLNESS
141.2

14. 87%
Casual Dining
Restaurant Consumers
Compare the Casual Dining Consumers
Demographic with Applebee’s Audience
Applebee’s audience
overlaps with our
Casual Dining
Restaurant Consumers
demographic by 80% in
top interests, including:
Beauty & Wellness,
Fashion, Food and
Motors

15. CASUAL DINING CONSUMERS:
BEAUTY & WELLNESS
Applebee’s audience over
indexes as Beauty & Wellness
Aware (160.0)
They are enthusiastic about
cosmetics (cosmetic
connoisseurs 179) and physical
activities (Active & Fit 162.0)
Hair care products collect very
high popularity points (169.1)
COSMETICS
CONNOISSEURS
158.6
ACTIVE & FIT
152.7
BEAUTY & WELLNESS
AWARE
141.2
CLICK HERE TO SEE
TOP BEAUTY BRANDS
HAIR
CARE
144.5
APPLEBEE’S
AUDIENCE CROSSOVERS

16. CASUAL DINING CONSUMERS:
FOOD
Applebee’s audience over
indexes as Foodies
(Foodies 184.4).
They are highly over indexing on
the Self-Conscious Snackers
trait (186) .
Like Applebee’s competitors’
audiences they are Social
Drinkers (134.8) and they are
interested in Gourmet &
Specialty Foods (190.0).
CLICK HERE TO SEE
THEIR FOOD BRANDS
SOCIAL
DRINKERS
FOODIES
177.8
POPULARITY
SELF-CONSCIOUS
SNACKERS
157.9POPULARITY
147.3POPULARITY
GOURMET & SPECIALTY
FOODS
166.0POPULARITY
APPLEBEE’S
AUDIENCE CROSSOVERS

17. Motors is another interest
shared by the two audiences
analyzed.
Applebee’s fans are more
attracted by cars. Indeed
they over index as Car
Experts (147.6).
Racing Drivers are slightly
over indexing (115.0)
CASUAL DINING CONSUMERS:
MOTORS
MOTOR
LOVERS
157.9
POPULARITY
MOTORCYCLES
136.3
POPULARITY
RACING
DRIVERS
122.0
POPULARITY
CLICK HERE TO SEE
THE TOP MOTORCYCLE BRANDS &
RACING DRIVERS
APPLEBEE’S
AUDIENCE CROSSOVERS

18. Applebee’s’ audience is less
interested in fashion (142.1).
They heavily over index as
Swayable Shopaholics (182.6).
They are in love with accessories
(181.0) and are interested in
Athletic Apparel (133.5)
CASUAL DINING CONSUMERS:
FASHION
SWAYABLE
SHOPAHOLICS
182.6
POPULARITY
FASHION
LOVERS
173.9
POPULARITY
ATHLETIC
APPAREL
134.4
POPULARITY
TOP APPAREL RETAIL STORE
KNOW
MORE
APPLEBEE’S
AUDIENCE CROSSOVERS

19. CONSUMER
INSIGHTS SUITE
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