Applebee's Splits With DraftFCB

Under New CMO, Chain Opens Review for $175 Million Ad Account

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CHICAGO (AdAge.com) -- Applebee's International has put its $175 million advertising business in review, ending its seven-year relationship with DraftFCB, Chicago.
The chain plans to complete the review, led by recently hired Chief Marketing Officer George Williams, by the end of the second quarter.
The chain plans to complete the review, led by recently hired Chief Marketing Officer George Williams, by the end of the second quarter.

New CMO
The move comes a month after the Overland Park, Kan., casual-dining chain named George Williams chief marketing officer. Mr. Williams will lead the review, which he plans to complete by the end of the second quarter. DraftFCB was invited to participate but declined, according to the agency and Applebee's.

"We are eager to write the next chapter in the advertising life of this great brand," Mr. Williams said in a statement from the marketer. "We are looking for the best and brightest minds in the business to bring forward fresh, new and compelling advertising that will make consumers hunger for our food and eager to be a part of the Applebee's dining experience."

A year ago the chain launched its short-lived Applebee's Guys campaign and has since used "food and music"-style creative to promote its menu.

Under fire
Applebee's has been under fire from activist shareholders for poor management and share performance. The chain ended 2006 with a 1% decline in same-store sales. The company's board announced yesterday its strategy committee would need another six to eight weeks to conduct a financial review and evaluate strategic alternatives, including potential sale of the company.

The marketer allocated $56.7 million for advertising costs in 2006, according to its March 1 annual filing with the Securities and Exchange Commission.

DraftFCB is losing agency fees estimated at roughly $3.5 million, according to an executive close to the situation.

Different direction
"After a very amicable seven-year relationship, DraftFCB and Applebee's have mutually agreed to end our relationship due to the direction Applebee's new CMO wants to take the work," the agency said in a statement. "While DraftFCB was invited to defend the account in an agency review, we have respectfully declined. We wish our many friends at Applebee's every success going forward, and we remain committed to ensuring them a very smooth transition to a new agency."

Media-buying and -planning duties will remain at Publicis Groupe's Starcom, Chicago, an Applebee's spokeswoman said.
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