With about half of its 461 stores open for more than a year, Boston Chicken is trying to keep customer traffic brisk by testing new entrees and offering lower-price dishes-like its $2.99 vegetable pot pie. A source close to Boston Chicken said stores in mature Southern and Eastern markets in particular aren't doing as well as the company anticipated.
Boston Chicken early next year also starts serving breakfast, offering baked goods prepared and distributed by flagship stores in each market.
A spokesman denied reports that Boston Chicken's revenues are being artificially pumped up by franchising fees, saying such fees represent "less than 12% of revenues." On the strength of opening 85 new restaurants, the chain's third-quarter earnings more than tripled from the year-earlier period to $4.7 million; systemwide store revenue rose 134% to $99.3 million.
Nevertheless, the biggest bird west of the Mississippi has invited yet another marketing guru to its nest. Six months after recruiting former KFC USA President Kyle Craig as chief concept officer, Boston Chicken has now hired Blockbuster Entertainment Corp.'s former chief marketing officer, Jim Hilmer, as a consultant working on new menu and store design ideas.
Mr. Hilmer's work is being incorporated into one franchisee's new store format, opening within weeks in Winston-Salem, N.C. The facility boasts a new interior design and graphics; the menu offers meat loaf, ham, fresh baked bread, soup and desserts.
Mr. Hilmer engaged Blockbuster agency D'Arcy Masius Benton & Bowles, St. Louis, to design marketing support for the added menu items. But DMB&B backed out of the project a few weeks after accepting the offer, citing a conflict with client Burger King Corp., whose national media buying the agency handles.
Bayer Bess Vanderwarker, Chicago, still has the main $35 million Boston Chicken ad account. The chain's agreement to have the Leap Partnership prepare alternate creative strategies fell apart earlier this year.
Boston Chicken, which this summer moved its corporate headquarters to Denver from suburban Chicago, last month also recruited Gary Naifeh from nearby Coors Brewing Co. to serve as VP-national marketing.
"Rotisserie chicken is just too narrow a focus to drive frequency," said Ron Paul, president of restaurant consultancy Technomic, Chicago. "Deep down everyone realized that if you're going to get your target customer to come more than once a week, you have to add to the menu."
Competing chicken chains won't make it easy for Boston Chicken.
KFC Corp. early next year will broaden its commitment to home-style cooking with the opening of Colonel's Kitchen, a test unit in Dallas serving chicken and other entrees along with an array of side dishes. Under the direction of new USA President-CEO David Novak, KFC is the latest in a string of fast-feeders to experiment with Boston Chicken's style of upscale fast-food.
Next April, KFC's new image campaign from Young & Rubicam, New York, will salute all the chain's chicken choices, including the Colonel's Gold rotisserie chicken introduced in 1993. A KFC source said the image spots won't include the actor who portrayed founder Colonel Sanders in commercials this year.
Now operating 200 stores in 35 states, Kenny Rogers Roasters in November hired the Morrison Agency, Atlanta, for the chain's account, which next year will grow to $3 million to $5 million. Tinsley Advertising, Miami, previously handled. The chain last month also doubled to 16 the number of its side dishes.
Jeffery D. Zbar contributed to this story.