I certainly can’t quibble with the inventiveness and volume of really fun work Crispin’s done for Burger King. But it’s enlightening to read this BusinessWeek report of BK’s recent sales and struggles:
Chuckles and kudos aside, CEO John W. Chidsey now has a problem. He has missed a sharp turn in consumer spending and sentiment. While competitors like McDonald’s (MCD) blanketed the market with dollar deals this spring, Burger King stuck with ads that wooed its male “superfans”–and alienated thousands of parents. And sales in April alone show the results: a 7% rise for McDonald’s as Burger King revenues remained weak in many markets after a dramatic fall in March. “That caught us a bit off guard,” admits Chidsey, 46.
Chidsey is tweaking his strategy to draw in more budget-conscious consumers, but he remains committed to wooing the young men he calls “our core customers.” He says Burger King will put more of its $300 million ad budget into promoting value offerings and plans to increase overall advertising by up to 25% next year. But after years of carefully working to repair relations with the chain’s 1,200 franchisees, he recently authorized a move to take 20% of the marketing payments that soda makers give owners and funnel it to headquarters to boost the global ad budget. The franchisees, who own 90% of Burger King’s 11,800 restaurants, filed a lawsuit on May 4 demanding that Burger King return the money. “The singular action of seizing these funds has completely destroyed what John built with the franchisees,” says one angry owner.
This is a problem. If the franchisees need to sue to get their money back, it could be because they don’t care for the Crispin work (the article mentions the recent Spongebob campaign) or they feel it’s just not goosing sales enough. Maybe this too shall pass if and when the economy turns, but it sure doesn’t sound good for lovers of CP+B’s work who want to see more.
And the comments section of the article is quite lively.
