A CMO change, a big sales slump, or lackluster work that's not getting recognition. Typically, these are the sorts of things that lead to an ad agency change. But not in the case of Denny's, which in a surprise move has dumped its agency of record for the past three years, Interpublic Group of Cos.-owned Gotham in New York. It will be replaced by Greenville, S.C.-based agency Erwin Penland.
Erwin Penland has been a partner of Denny's during Gotham's time on the account, handling in-store advertising among other duties. The move appears to be part of a desire to cut its roster and work with fewer agencies. Said Denny's as part of its statement: "We see the opportunity to both consolidate our business for efficiency and enhance our united national and local marketing and advertising efforts, while upholding the high creative standards that have been set by Gotham."
"It is a badge of honor for us to have worked in a category that's been down since the recession started and help a brand that's 60-plus years old be competitors in casual dining and quick serve on a much smaller budget," said Gotham President Nick Johnson. "And, to do that not just in TV but in digital and social is something we're very proud of. Last year, we won both a Brand Renaissance Effie and a Branded Content Lion for Effies, and that was less than two years after we won the business from Goodby Silverstein. We are very proud of this case study and have had a number of foodservice clients come to us in the past year-and-a-half based on the Denny's work. We're excited to find another partner in the space."
With Gotham, Denny's launched a number of campaigns for quirky products that were unusual for the chain-restaurant category. In October, it launched a Middle-Earth inspired
menu as part of a tie-in for "The Hobbit: An Unexpected Journey," one of the chain's biggest movie promotions. Gotham also created the campaign for Denny's Baconalia limited-time offer in 2011, which included a Maple Bacon Sundae -- a menu it reprised earlier this year.
Gotham also worked with Denny's Hispanic agency, Casanova Pendrill, and Dog Whisperer Cesar Milan on a humorous Hispanic branded-content effort. In 2011, Gotham was part of an effort with DumbDumb, Jason Bateman and Will Arnett's production company with Ben Silverman's Electus, that saw the creation of a branded-entertainment online talk show that took place in a Denny's in Hollywood and featured actors such as Mr. Bateman. That campaign, called "Always Open," was buzzy and won a Cannes Lion.
Denny's marketing leadership has not changed; Frances Allen, who joined in 2010 from Dunkin Donuts, remains CMO.
Denny's systemwide sales were up in 1.2% in the U.S. in 2012, according to Technomic. However, after making it through the recession, the company in the first quarter saw a dip in same-store sales of 0.7%, the first drop in nearly two years. That could be one reason why its looking to trim ad costs.
The chain in the first quarter was promoting value heavily; President-CEO John Miller said at the time that flagging economic confidence was impeding consumer spending. He added that the company will continue to focus on balancing value and limited-time offers.