Jamie Spencer
Dine Brands, the parent company of Applebee’s, IHOP, and Fuzzy’s Taco Shop, is launching a bold initiative to modernize its restaurant chains as it faces declining sales and shifting consumer habits.
Challenges in the Casual Dining Sector
For years, Dine Brands has kept America’s most nostalgic restaurants running, but inflation and economic uncertainty have led consumers to cut back on dining out. As a result, consistency in operations, service, and food quality has declined.
According to Dine Brands’ fourth-quarter earnings report for 2024, Applebee’s domestic same-restaurant sales dropped 4.7% year-over-year, while IHOP’s declined by 2.8%.
Introducing “Lookin’ Good”: A Multi-Year Revamp
On March 5, Dine Brands announced the “Lookin’ Good” initiative, a multi-year program aimed at modernizing Applebee’s locations and enhancing customer experience.
The company will begin with 47 Applebee’s restaurants acquired from franchisees last November. Of those, 30 will undergo remodeling in 2024, and five will be converted into Applebee’s/IHOP dual-branded locations.
“We’re focusing on elevating the guest experience through improving operations, enhancing our menu and value offerings, and better communicating the value of our brands through dynamic marketing,” said Dine Brands CEO John Peyton during an earnings call.
The revamped Applebee’s locations will feature a modern design optimized for off-premise dining, which accounted for nearly 22% of sales, according to the latest earnings report.
Expanding the Dual-Brand Restaurant Concept
In addition to upgrading Applebee’s, Dine Brands is expanding its dual-branded Applebee’s/IHOP locations. The concept, which has already seen success internationally, offers cost-saving efficiencies while increasing revenue potential.
“On average, we’ve seen these locations achieve 1.5 to 2 times the revenue compared to a single-brand restaurant,” said Peyton.
Dine Brands plans to open 12 to 14 more dual-branded restaurants across the U.S. this year to boost brand recognition and reach new markets.
This approach allows the company to reduce overhead costs while offering consumers more dining options in a single location.
A Strategic Move for Growth
Dine Brands hopes its modernization efforts will reinvigorate sales and improve customer loyalty. By focusing on restaurant upgrades, menu enhancements, and a dual-brand expansion, the company aims to strengthen its position in the competitive casual dining industry.
