Can Popeyes Stay Ahead of the Fast Food Decline?

Popeye's store front

Photo: Thursday Review

Can Popeyes Stay Ahead of the Fast Food Decline?
| published March 10, 2015 |

By Thursday Review staff


If you have wandered into any Popeyes location in any city or state in the last year or so you probably noticed the makeover. Most of the Sandy Springs, Georgia-based company’s 1,870 locations have been redesigned and refurbished in an attempt to eradicate all signs of the old, sometimes grungy and ragged appearance that the restaurant once maintained.

The new Popeyes look includes brighter, cleaner ordering areas, more space devoted to the areas where customers stand or line-up to place orders, and a brightly lit restaurant dining room. Cajun motif murals and paintings adorn some walls, and the menu board has been upgraded to make it easier and faster for everyone to make a choice.

Founded in Arabi, Louisiana in 1972, and once based in New Orleans, the chain was nearly bankrupt in 1990 when it sold most of its holdings to AFC Enterprises (America’s Favorite Chicken), the same company which once owned Church’s Chicken. AFC sold Church’s in 2004, and has focused all its energies on Popeyes.

Though it is a moot point now, for decades founder Al Copeland avoided legal issues with the owners of the Popeye the Sailor Man cartoon images and franchise by pointing out his restaurant was too poor to buy the apostrophe. He claimed the inspiration for the name came from the character Popeye Doyle, of the book and film The French Connection. Nevertheless, the restaurant chain decided in late 1980s to officially buy the rights to the famous cartoon sailor from King Features, and marketers tied the two streams of images and characters closely together.

That relationship ended mutually in 2006 when both sides parted ways: indeed, nary a sign of the spinach-eating sailor can be found anywhere in a Popeyes restaurant now, nor, for that matter, will you find Olive Oyl or Bluto or Swee’Pea. At that time all marketing and imagery shifted back toward the New Orleans and Cajun themes.

Popeyes has been helmed by CEO Cheryl Bachelder since 2007. Bachelder served once as the president of KFC, but she was fired by her chairman in 2003—a low point in her career. Nevertheless, she struggled back, and found opportunity a few years later when Popeyes came calling. Since then, she has proven her mettle, as it were, by improving just about everything about the 42 year-old-franchise. The big revamp of the restaurants was accompanied by a name tweak: the franchise is now officially known as Popeyes Louisiana Kitchen. In addition to the makeovers of the restaurants and a spate of new restaurant openings nationwide, up about 300 U.S. stores just since she took over, Bachelder has overseen the improvement of the menu and the recipes.

Bachelder, like the folks at McDonald’s who have discovered the hard way that American tastes and preferences can change—rendering “reliability” pointless—she has watched as KFC lost millions of customers to Chick-fil-A and Popeyes. In interviews with business reporters she has made it clear she believes that one of the most intense demands of any restaurant—fast food, fast casual, or sit down—will be an emphasis on quality products and better food. Processed foods, meats produced using steroids or antibiotics, preservatives, additives, sodium levels, even color enhancers, have all become negative factors for many restaurants, and consumers are now watching these changes.

Popeyes, which does not pretend it is serving health food—this is, after all, deep fried chicken—is able to at least point demonstrably toward its commitment, Bachelder says, to fresh ingredients and homestyle recipes largely devoid of the strange brew of preservatives, additives, steroids, and processed junk found elsewhere. She says that the company’s roots along the Gulf Coast and in New Orleans also mean that the franchise has an obligation to walk the walk, not just talk the talk—thus its linkages to seafood and coastal style cooking, and its frequent homage to a finer style of taste and dining.

Bachelder also says that today’s friend chicken market prefers Popeyes batter, which she says it crafted to be ampler and crispier than KFC’s famous pressure-cooker method.

Reality check: KFC has never “fried” its chicken. Its unique texture and taste is the result of an extreme high-heat pressure cooker method which traps fluids, giving the crust a softer surface value. Popeyes crunchier, crispier batter makes for the kind of coating preferred, Bachelder says, by a growing number of American consumers.

Business analysts believe that Bachelder’s endgame is to stay ahead of the curve—and that curve is the migration of many younger consumers away from the traditional fast food haunts, such as McDonald’s (which has seen 12 straight bad quarters, and its worst quarter ever this year), Burger King, and KFC. The fast-casual restaurants have gained at the direct expense of these once unstoppable mega chains, and that means more customers for Chipotle, Moe’s, Zaxby’s, Five Guys, Panera Bread, Baja Fresh, and a dozen other newer franchises which together has drawn in billions of dollars of the restaurant market. Where McDonald’s lost 1.2% in the last few months, Chipotle, to name one example, grew by more than 20%, a remarkably brisk rate it has maintained for five straight years.

Bachelder wants to hang with this migration, and she sees the menu as the best way to tackle the big shift in the marketplace. And she thinks that her current edge over close competitor KFC will widen as Popeyes embraces the changing preferences which are driving customers away from some of the most iconic of the fast food chains.

According to recent press releases by Popeyes Louisiana Kitchen, the company operates a total of 2,379 restaurants in the U.S., Guam, Puerto Rico, the Cayman Islands, and 26 foreign countries.

Related Thursday Review articles:

Can McDonald's Halt its Decline?; Thursday Review staff; Thursday ReviewMarch 10, 2015.

Tarnish on the Golden Arches; Thursday Review staff; Thursday Review; August 26, 2014.