|
|
|
|
|
|
|
|
A Really Big Idea. Burger King's CEO has turned around the chain with a radical notion: give people what they want. By Bret Begun. NEWSWEEK. May 23, 2005 |
|
|
Greg Brenneman starts his morning in the middle of the night. He's up at 4:15, then races his Porsche to the office in Miami. He hits the StairMaster for an hour in the corporate gym, lifts weights, showers and is at his desk before 7. This discipline is relatively new: through the years, Brenneman's weight has see-sawed by 90 pounds. But he's a faithful convert to healthy living. Coffee? He drinks decaf: "I'm wound tight enough." Lunch is often a salad. To relax, he skis and trains for triathlons. He was hiking on a mountain last July when he got a call from business partners wanting to offer him a new job. "I was at 13,800 feet," says Brenneman. The position: CEO of Burger King. |
|
Opposites do attract. Hiring a decaf-drinkin' triathlete to run the home of the Whopper may seem like an odd choice, but so far it's a match made in burger heaven. Brenneman, 43, inherited a troubled company. The chain had gone through 10 CEOs in 14 years and was in danger of losing the No. 2 spot behind McDonald's to Wendy's. But Brenneman reversed the skid. The company has reported solid same-store sales growth month after month since he started last August. Brenneman could have easily looked smart just adopting the McStrategy. The industry leader was enjoying its own upswing, eliminating supersizes and pushing salads. Instead, Brenneman went after his antithesis: the guy who downs fast food up to five times a week and wants decadent items, like the 760-calorie Enormous Omelet Sandwich (two omelets and cheese slices, three strips of bacon and a sausage patty on a bun). |
|
The strategy is just about giving his best customers what they want. "We'd love to have everybody," says Brenneman, in his office at a table supported by a plaster Whopper. "But you better figure out who will drive business."
It sounds like a "no-duh" strategy now. But as recently as 2003, Burger King was struggling with an unpopular new low-fat sandwich. Brenneman was struck by a market study that showed hard-core fast foodies made up only 18 percent of the population but accounted for 49 percent of business. His new priority: stock the pipeline with items for these "Super Fans": men, 18 to 34, who like football and are "gray collar" workers, because their jobs aren't a bright spot in their lives. The trick is to turn the volume up to 11. Like spicy? A chicken sandwich with pepperjack cheese and jalapenos is near. Need a jolt? New Red Bull-inspired coffee is coming with 40 percent more caffeine than regular&emdash;for those who "partied a little hard the night before," says Denny Post, chief concept officer.
Burger King gets away with its food with 'tude partly because, as No. 2, it doesn't face the same public pressure as McDonald's, the dark force in "Super Size Me." "McDonald's takes more of the brunt of the press and nutrition Nazis," says Brenneman. He's used the cover that McDonald's provides to focus on Super Fans with edgy advertising and a reborn "Have It Your Way" tagline that pushes "democratic indulgences," says Brenneman. Ad agency Crispin Porter + Bogusky has restored Burger King's cultural relevance, too, with the buzz-making subservientchicken.com (where a chicken-costumed human responds to commands) and spots starring a fictional Dr. Angus, who promotes a diet of the chain's Angus burgers. CP+B president Jeff Hicks says Dr. Angus spoke to Super Fans as a "cool uncle" would, with a "voice that has a little adolescence. It's a different voice than our competition."
For Brenneman's burger battle plan to succeed, he says the "doom loop," a pattern of disrespect between the company and franchisees, must end. He stopped it at Continental Airlines in the '90s when he and the then CEO Gordon Bethune ended 16 straight years of losses by getting carrier employees focused on its Super Fan: the business traveler. "Greg's John Wayne, getting everybody to pull in the same direction," says Stephen Pagliuca, managing director of Bain Capital, one of Burger King's owners. Like in the movies, Brenneman wants everyone on script. So just as Bethune did, Brenneman sends out a weekly voice mail to update workers on progress.
Brenneman's most radical innovation has less to do with burgers than bricks and mortar. Burger Kings are among the costliest restaurants to build and the least profitable in the industry. At a franchisee convention in Las Vegas this week, Brenneman's unveiling a design that shaves about a third off start-up costs. Since nearly 70 percent of business is at the drive-through, dining rooms will shrink (and get a Starbucks-style, industrial-chic makeover). Seats won't be nailed down&emdash;his pet peeve, since Little Leaguers couldn't gather at one table after a win. Brenneman also wants franchises open earlier: since its debut in March, Enormous Omelets have helped grow breakfast sales 20 percent. An initial public offering could come next year, he says. Longer-term goals include a revamped value menu. As a reward for all his work, he'll treat himself to an occasional Whopper. "Everything in moderation," says Brenneman. Except for those Super Fans.
© 2005 Newsweek, Inc.
