Why IHOb? IHOP's President Explains the Daring Campaign

The spotlight is on the 1,700-unit brand. Now, it's time to capitalize.

June 2018 Danny Klein

It’s been quite a week for IHOP. Ever since the iconic chain posted to Twitter and Facebook on June 4 with its plan to become IHOb, the Internet went crazy with speculation. More than 3,000 articles, 8 billion impressions later, and the No. 1, No. 2, and No. 4 trending spots on Twitter all at once on June 11, IHOP is sharing the why behind one of its boldest moves in 60 years of casual-dining history.

For starters, the change is not permanent. Not in branding and not in the notion that IHOP is abandoning its past. IHOP is still I-H-O-P and it’s still going to dominant breakfast. The Dine Brands chain wanted to expand its dinner and lunch business, especially as off-premises ramps up (dinner and lunch are where the majority of to-go and pick-up occasions occur typically), and saw this buzz-worthy path as the best way to do so. With a muted campaign, would anybody have given IHOP’s foray into the burger space the attention executives felt it deserved? Surely not to this degree. Now, however, with the spotlight on, IHOP believes its product, made with 100 percent USDA Choice, Black Angus ground beef, will do the rest of the talking.

IHOP president Darren Rebelez took some time to chat with FSR about the IHOb initiative, what the brand hopes it accomplished, and what this practice revealed about the brand’s past, future, and everything in between.

So walk us through how this came to life. It’s far from you average marketing campaign, to say the least.

When we looked at our business, we have such strength at breakfast. We’re so well known and beloved for our pancakes and all of our other breakfast food. But we have this untapped whitespace around lunch and dinner. We’re on a concerted effort to do something about that.

We decided to start with burgers. We knew because we’re so strongly associated with breakfast that we were going to have to do something bold, and a little bit on the risky side to make sure that we broke through—that people would think about us in a different way.

This idea came to us from our team, both internally and working with our ad agency Droga5. Yeah, when I saw it … it was bold. And we had to talk through it. But for us, what it really signified, and this was part of our strategy all along, we’re taking our burgers as seriously as our pancakes. We were going to set out to build burgers that have the highest level of quality we could. To do that, and to convey that in kind of a fun and quirky way, we needed to do something different. So the flip from a “p” to a “b” was a simple way to do that, and I would say that it’s exceeded all of our expectations in terms of how much buzz and interest it’s generated.

Speaking of buzz, just how crazy has it been?

We expected to get attention. That was the whole purpose behind doing what we did. So we knew we would get some interest, but none of us could have ever anticipated it would be on the order or magnitude that it’s become. We’ve had over 3,000 articles written and 8 billion impressions last week. And now we’re trending No. 1., No. 2, and No. 4 on Twitter right now. It is just absolutely blown away any expectations we had.

IHOP

Burgers. Burgers. Burgers. IHOP wants to drive the message home.

What’s the internal reaction been like at IHOP as this whole campaign has blown up?

It’s been a lot of fun, I will say that. Literally everyone here has had their phones blowing up from everybody they know trying to pump us for information, and trying to figure out what the “b” stood for. It’s been a lot of fun. But it’s also been a really great reminder of just how beloved this brand is. And how relevant it is today. I think there’s a misperception out there about our brand that maybe because we’re 60 years young that we’re not as relevant as we should be. Over 50 percent of our guest base is aged 34 and under. So we have a great following with millennials, a great following with Gen Z. So I think this exercise this week, and the level of engagement and support we’ve seen on social media, kind of indicates that. We’re very relevant to a younger generation.

Dine Brands CEO Stephen Joyce said in a recent earnings call that the death of casual dining was “false news” and echoed some of these points.

Look, our brand is loved by all generations. We certainly have seen seniors as well, but we’re focused on families. We get families and with families come people of all ages. That’s who we’ve always been, and particularly now I think this initiative has been a spotlight on that.

Let’s talk about the goal of igniting lunch and dinner dayparts. Breakfast accounted for 49 percent of sales last year and obviously IHOP doesn’t want to detract from that strength. But how can burgers help the brand capitalize on the whitespace lunch and dinner offer?

We had to start with the product itself. We really had to make sure we had a high, high-quality product because everybody knows that we do great breakfast food but we’re not as well known for our other foods. So we started there. We started off with the meat. We’ve got an all-natural, 100 percent USDA Choice Black Angus steak that we make our burgers out of, and we hand-press them on the grill to really lock in the juices and flavors. And we top it with all kinds of high-quality products, whether it’s our custom-cured hickory smoked bacon or thick-cut onion rings, or in the case of our Brunch Burger we put an over easy fried egg, hickory-smoked bacon, and a hash brown potato cake on there. All of that is on our brioche bread bun, which is the same bread that we use on our brioche French toast. We started off with high-quality ingredients that we know are going to deliver.

The second thing we needed to do is let everybody know that we’re actually in the burger business. That’s kind of the phase we’re in right now. We did a teaser campaign and got everybody talking about it. All eyes on us. Now, we’ve had the reveal. There are probably not too many people in America who don’t know that we’re selling steakburgers now.

And then the third component of that was offering a compelling value proposition for the guest to come in and try it. That offer right now is our classic cheeseburger with unlimited fries and a soft drink or iced tea for only $6.99. What we’ve found in our testing is that any time a consumer had tried the product the intent to revisit scores were off the charts. We knew we were on to the right product, we just had to find a way to let people know we had it, and give them a reason to come in. We think we’ve done all three of those and now we’ll see the results of that in the coming weeks.

IHOP

IHOP's Ultimate Steakburgers are made with all-natural, 100 percent USDA Choice, Black Angus ground beef.

What were the earlier tests of the burgers like?

We did four different test markets with some lower levels of media. We wanted to make sure we got this right. In fact, also in that process, we ran the concept of flipping the “p” to a “b” by those guests as well. We pretty much got the reaction from those groups that we’re seeing in social media right now. A little bit of shock. A little bit of dismay. But then once we explain to people that this is more tongue-and-cheek and we’re not changing the name forever—that this is just a way to convey that we’re taking our burgers as seriously as our pancakes—then everybody got it and appreciated it for what it was.

Has there been any negative kickback to the campaign?

One thing I would like to make sure is very clear is that this is not a permanent change to IHOP. IHOP is going to stay. As I-H-O-P. And the pancakes are always going to be there. Our breakfast focus is always going to be there. But we are still conveying that message that we’re taking our burgers as seriously as our pancakes. And the food is every bit as good with these burgers as it is with any of our breakfast foods.

I want to make sure that message gets across because there have been a number of people who have been a bit confused about that and think that we’re walking away from pancakes. In fact, you can get a side of pancakes with your burger if you don’t want fries. Not only can you get both, but also you can get both at the same time. You don’t have to choose.

IHOP

International House of Burgers. An IHOP flagship in California is going all-out for the IHOb campaign.

Returning to the idea of brand value, this really seems to have affirmed what the IHOP name and history means to a lot of people around the country.

This is something that we always knew. If you work or have worked for IHOP, you’ve had this experience. You meet somebody new and you tell them you work for IHOP and the first words out of their mouths are, ‘Oh, I love IHOP.’ That’s kind of a universal thing. We always experience that and we know there’s this love for IHOP. But when you go through a process like this you really get to see just how beloved of an America icon IHOP is. It’s really gratifying to be able to see that love come to life in such a big way.

Where do you go from here? With great attention comes great possibility and expectations, doesn’t it?

We think this has a lot of legs to it. Here are a couple of reasons. One, this isn’t an LTO for us. This is a permanent part of the menu. And you’ll see that when you go into the restaurants. It is a permanent part and the way we view this is this is the first step that we’re taking on really building that lunch and dinner business for the long-term. That’s why we invested so much time and energy in making sure we got the product right and the launch campaign.

The second piece was our growing meals to-go business. We launched our meals to-go platform in Q4 of last year, enabled that with an online ordering platform, and our new mobile app that enables the online ordering. Now we’re in the process of testing delivery with a few providers. The preponderance of delivery orders and off-premise dining occasions is really in the lunch and dinner daypart, more skewed toward dinner. So we think that burgers are a great option for that dinner daypart. People can always get our breakfast food anytime of the day. But as they start to shift their focus more on savory traditional lunch and dinner type of items, we think this fits very well with that.

The value aspect, how important was that to driving lunch business given the fast casual and quick-service competition?

It’s a great value. I would put our burgers up against anyone’s—they’re that good. We’re convinced when people come in and try this quality of a burger at the price point that we’re offering right now, it’s going to be a compelling value proposition and they’re going to come again.

In regards to repeat guests, where does IHOP focus its efforts now that the attention is there?

Our focus right now is on in-restaurant execution. Our franchisees have been very engaged in this process. They’re very excited about the initiative and they’ve been working really hard with their teams to make sure we put our best foot forward on this. I think as things started to unfold last week, the level of urgency started to increase as well. Everybody is really geared up and excited to introduce the world to these new steakburgers.