Corporate Training
September 21, 2012
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It’s easy to see why some women are creeped out by Hooters, the chicken-wing chain known for buxom waitresses in tight orange shorts. The wall-to-wall dark wood, posters of bikinied Hooters girls, and tables of titillated guys downing pitchers of beer and making cracks about the chain’s “great wings” makes for a decidedly frat house vibe. Yet Chief Executive Officer Terry Marks’s makeover of the ultimate guys’ place depends heavily on paying more attention to its core customers’ wives and girlfriends.

Marks, a former Coca-Cola (KO) bottling executive hired last year to redo the chain, wants to remove the Hooters stigma so men aren’t embarrassed to put a visit to the chain on their expense accounts and women aren’t so quick to veto a meal there. “Face it, females are 51 percent of the population,” says John Gordon, principal at Pacific Management Consulting Group. “They’ve enjoyed more employment growth, and you can’t ignore them.”

Hooters is still mostly for guys, who make up two-thirds of the chain’s customers. Marks insists Hooters will remain every bit as sexy and that the iconic uniforms will stay. Instead, he’s concentrating on freshening up the menu (which drew yawns from female diners on research panels), creating a night scene, and bringing more light into the restaurants. “There’s an opportunity to broaden the net without putting wool sweaters on the Hooters girls,” says Marks. “Everything we do should appeal more to women, but nothing we will do will turn men off.”

Facing competition from other so-called breastaurants including Tilted Kilt Pub & Eatery and Twin Peaks, Hooters could use a revamp. After the Atlanta-based chain’s U.S. revenue peaked in 2007 at $960 million, the recession took a toll, and sales have decreased every year since, according to restaurant consultant Technomic. Revenue dropped 3.4 percent last year, to $858 million, while U.S. full-service restaurant revenue increased 1.8 percent, Technomic data show.

The first Hooters was opened as a lark in Clearwater, Fla., in 1983, by six businessmen who didn’t take the beach bar too seriously. The name is a euphemism (you know for what) from a Steve Martin comedy skit and the Christmas lights found in most locations became a trademark after the owners were too lazy to take them down after the holidays. A group of Atlanta investors added capital and the chain has since grown to 430 restaurants in 44 states and 28 countries. Hooters of America, the franchising organization that hired Marks, operates the majority of restaurants and is controlled by a group of investors including international restaurant operator Chanticleer Holdings (HOTR).

Marks has spent much of his 10 months with Hooters improving the menu, which now touts fresh, not frozen, wings and hamburger patties. The chain has doubled the number of salads to six, replacing iceberg lettuce with mixed greens and adding shrimp, spinach, and fresh herbs to give women and health-conscious men more choices. In locations owned by Hooters of America burgers now come with fries, and wings are served with blue cheese sauce after research revealed that customers felt nickeled and dimed buying them separately.

There are signs of traction, says Jessi Isola, marketing director at Oceanside (Calif.)-based Hoot Winc, a Hooters franchisee with stores in California, Washington, and Oregon. More women are showing up at the company’s 18 West Coast locations, she says. On a recent weekday at a Hooters in Chicago’s Near North neighborhood, Jeaneth Mazzocco, 38, had just finished a batch of classic wings with co-worker James Pierson, 47. Mazzocco dines at Hooters about once a month, although she admits that their work colleagues at University of Illinois at Chicago “find it funny that we go.” Pierson brushes aside such thinking. “It might have been seen as scandalous 40 years ago,” he says. “We’re going there for the food.” The beautiful girls are just a “gimmick” to get diners in the door, he adds.

Hooters is also renovating 70 percent of its U.S. stores, adding amenities such as street-level patios and replacing some of the dark wood with more contemporary furnishings to evolve beyond the beach shack vibe. Bars will now be set up in the center of some restaurants to lure late-night partiers, who can sample an expanded menu of cocktails and wines. And flatscreen televisions have replaced old TVs to showcase the costly professional sports programming packages Marks is adding so Hooters can make a promise to show every game. Chief Marketing Officer Dave Henninger says National Football League games and Ultimate Fighting Championship mixed martial arts bouts are huge draws for couples.

One of the most important design changes, however, will be larger windows in the restaurants so people outside can see in. Explains Henninger: “For those folks who are convinced there’s something to hide inside a Hooters, this new design should disabuse them of that notion.”

The bottom line: Four years of revenue declines have forced Hooters to revamp its appeal. Women, even fully dressed ones, are welcome.

About author

Dr Shailesh Thaker

Dr. Shailesh Thaker is a world-renowned management thinker and trainer on organizational behavior and development. He is the CLO of Knowledge Plus Inc., a highly reputed training firm based in Ahmedabad, India, helping organizations to achieve international benchmarks in management practices.

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