NOTE: Bloomberg Second Measure launched a new and exclusive transaction dataset in July 2022. Our data continues to be broadly representative of U.S. consumers. As a result of this panel change, however, we recommend using only the latest posts in assessing metrics, and do not support referring to historical blog posts to infer period-over-period comparisons.
What’s the secret to tripling sales overnight? For Applebee’s, it’s giving away free food. The casual dining chain runs a Veterans-Day promotion each year offering free meals for veterans—in 2016, it was the highest-grossing sales day of the year.
On November 11, sales were more than triple the 2016 daily average. In fact, Veterans-Day sales have hovered around triple the average daily sales for at least the past five years. This year, Veterans Day falls on a Saturday, which could mean an even bigger spike for Applebee’s.
Of course, all that free food doesn’t go unnoticed. Higher sales normally coincide with higher average transaction values, but November 11 is one of the few days that bucks the trend. Veterans Day had the lowest average transaction values of any day in 2016, down 20 percent from the average daily value of $38.99.
Bottoms Up to the Dollarita
Veterans-Day sales may be little more than a respite for the declining restaurant chain. From January through September this year, every month’s sales have decreased year-over-year. But Applebee’s has seen some success with its latest efforts to resuscitate the brand. The monthlong $1-margarita promotion started strong with a 15-percent sales increase in the first full week of October.
Unsurprisingly, as the Dollarita is lifting sales, it’s also depressing transaction values. The first full three weeks of October show an average transaction value of $36.48, down 5 percent from September and 7 percent from a year prior.
In addition to decreasing transaction values, promotions also eat away at profit margins, but it might be a worthwhile tradeoff for the struggling franchise. In August, Applebee’s announced plans to close more than a hundred stores. But, thanks to all the cheap booze, the first three weeks of October show that monthly sales are on track to produce year-over-year growth, a first for 2017.
Curious how Dollarita month ended for Applebee’s? To track this promotion and others like it, request a demo today.