CMO of the Week: IHOP's Kieran Donahue

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IHOP is celebrating its 65th anniversary this year and is balancing its modern marketing approach with its classic values. While the company is focused on delivering serving customers and franchisees, they are also experimenting with NFTs, crypto pancakes and TikTok.

IHOP is celebrating its 65th anniversary this year and is balancing its modern marketing approach with its classic values. While the company is focused on delivering serving customers and franchisees, they are also experimenting with NFTs, crypto pancakes and TikTok.

IHOP’s chief marketing officer Kieran Donahue knows that consumers are looking for ways to stretch their dollars. Since she joined the company in February 2021, she has been focused on delivering two main things to customers – quality and value. “Our guests care about value, and they care about quality,” says Donahue. “We look at both of those as our true north. How do we make sure that we have the quality ingredients that our guests have come to expect from us, but at the same time offer affordable prices?”

The brand offers an IHoppy Hour, a daily value offer with select menu items starting at $6 starting at 3pm, as well as bonus offers for free food through its recently launched loyalty program, deemed International Bank of Pancakes, to deliver on this value promise. On National Pancake Day (February 28), the brand will be giving away free Buttermilk Short Stack for dine-in customers from 7am-7pm and loyalty customers will receive double points on other purchases that day.

The brand is celebrating its milestone year with new menu items and by bringing back classic fan favorites.“Our focus is squarely on serving more joy to more people and to continue to bring that vision to life for the next 65 years,” explains Donahue. “We do that by staying close to our guests and close to our franchisees. You'll see there's some focus on new flavors, new entrees in particular. We now have salmon and Salisbury steak and are bringing back a few guest favorites as a surprise.”

Prior to joining IHOP, Donahue held senior marketing roles at brands including Marriott and Hilton. Brand Innovators caught up with Donahue from her office in Southern California to discuss the brand’s 65th anniversary, the company’s new loyalty program and reviving iconic menu items. This interview has been edited for length and clarity.

How are you celebrating the 65th and how are you communicating that with customers?

It's pretty exciting to be at a brand that is now entering its 65th year. You'll see some new innovations throughout the year. You'll also see us go back to some classic guest favorites like Rooty Tooty Fresh and Fruity as a limited time offer. It's two eggs, two pieces of bacon or sausage and two pancakes for $6. It's a really good value. We're also looking at some other things that we might bring back some fan favorites or our guest favorites and probably introduce some new things along the way. 

You launched a loyalty program back in April. Can you share the strategy there?

One of the most important things is the relationship with our guests. Guests have choices today. They want to know that you value them and that when they're spending their dollars with you that it matters. That is really why we launched our loyalty program. We created a currency called the pan coin which is essentially a crypto pancake. We are having a little fun with ourselves and modern currency but also paying homage to the value of our pancakes. When you dine in, you can earn pan coins that can be redeemed for free food. 

We launched in April and we have about 3 million members already, which is terrific. It's more than what we forecasted. We're excited by what we're seeing in restaurant signups. Guests are redeeming a lot of pancakes and also burgers. We're looking forward to continuing to find ways to leverage our loyalty program through our app and our website. We're going to focus on the app a lot in 2023 and how there can be some additional loyalty offers and value through the app.

Can you talk about your NFTs and how you are approaching metaverse?

Our experiment with NFT was “New French Toast,” poking a little fun at ourselves. A lot of people thought that was pretty funny. We literally showed our french toast being on the griddle and on the plate and it just looked delicious. People appreciated that in a lot of ways. We tapped into a trend authentically. We are breakfast leaders, so our first NFT was to show off that we had introduced a new French toast and that was pretty appropriate for IHOP. 

Can you share how you are evolving your omnichannel marketing approach?

Omnichannel is how we plan our marketing and our go-to-market approach. We have guests that care about more than one thing – more than one pancake, more than one sandwich, more than one omelet and more than one entree. We have guests that care about value and quality. In order for us to get all those different messages out to our different guests, we have to lean into the omnichannel to make sure that we’re targeting all the right channels with the right message at the right time. 

We use a full-funnel approach. We make sure that we're putting the message on traditional TV and we're showing up on YouTube and TikTok. We're showing up where our guests are and we're trying to meet them where they are with messages that matter to them in channels that they trust. Digital allows us to connect with guests in ways that we haven't been able to in the past. We can hear what fans think and what they want and have the opportunity to bring menu items back. 

During the pandemic, when people were making little mini pancakes on their griddles at home, we worked with General Mills and we launched our first licensed cereal – mini pancakes. There are so many things that can come from this new omnichannel approach, because we’re actually getting a lot closer to guests and what they want and that allows us to meet them where they are.

Can you talk about how inflation is impacting your business?

According to our research, our guests care about value and quality equally. Our approach is to offer both. We focus a lot on quality ingredients and how we make our food. Pretty much everything we make is made to order. That omelet, those pancakes or that burger are all made fresh every single day on our griddle for your specific order. Quality plays a big part in everything that we do. 

But value is really important too. We look at value in three ways. There's the abundant value –we don't do small portions, we do healthy portions. It's also a limited-time value. A perfect example of that is Rooty Tooty Fresh and Fruity for $6 that we have right now. Then there's our IHappy Hour which are menu items starting at $6 that starts at three o'clock every day. Then there is exclusive value and that's where loyalty comes into play. That's where we're recognizing that you have a choice and where you spend your time and your money. We want to make sure that we recognize that and we value you. We are testing loyalty exclusives and getting feedback from our guests. You'll be seeing even more of that from us in 2023 and beyond.

Can you talk about how your past roles have helped shape your current perspective and approach to your role?

My time with Hilton and Marriott was very formidable. Iit really solidified for me everything around the guest. When I joined IHOP, I kicked off the most comprehensive research we've ever done as a brand to really understand  where our guests were, what they needed from us and where we needed to be so that we could meet them there. That really shapes a lot of how I approach things. Prior to my time in hospitality –which is the majority of my career– I was in retail and fashion and so I also have this belief that marketing has to make the cash register ring. 

I have a newfound appreciation for how things work on the restaurant side. In the hotel space, you have business on the books, you can plan for things in a way that is not the same in the restaurant business. Sure, you can plan for things when seasonality is in the restaurant business but things happen in real time so every day, it means something. We have to work really closely with our franchisees to make sure that we're delivering on our promise every day to our guests. 

Do you have any predictions for the brand or for brands in general for 2023?

Continuation of customer choice is just going to continue. It’s a choice in how they dine – whether they're dining in, getting delivery or picking it up and bringing it home. Then, customer choice on the menu. Those things are here to stay. The other thing that's going to become really important is purpose. Brands will work hard at trying to deliver on that purpose and do it authentically. Our ability to really build on that relationship with our guests is going to be key for us. And we’re going to continue to see more trends pop up digitally and through TikTok. 

From a menu perspective, you're going to continue to see this desire to have both healthy and indulgent options. We all want to be healthier and we aspire to that. We also all need a little break sometimes. We're trying to do a little bit of both, have some choices on the menu that when you want to be a little healthier, you can have some salmon or a plant-based sausage and egg white omelet. But when you really want to be indulgent, go ahead and dig into that thick and fluffy french toast or that awesome Angus beef steak burger. People are going to want to have it both ways and it's just going to depend on what day it is and how they're feeling.

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