After a disappointing 2024, Dine Brands—the parent company of Applebee’s and IHOP—is looking to turn things around with a stronger emphasis on value meals and a more impactful marketing strategy. CEO John Peyton acknowledges that while marketing is crucial, how you market is just as important as what you market. The challenge is standing out in an industry saturated with similar messages and promotions, as originally reported by CNBC.

Breaking Through the Noise

The restaurant industry is currently embroiled in a “value war”, with brands like McDonald’s and Outback Steakhouse aggressively advertising full-meal deals to entice budget-conscious customers. Applebee’s, despite attempts at pop-culture relevance—including mentions in Netflix’s Tom Brady roast and a prominent role in the movie Challengers—has struggled to cut through the clutter.

“You’ve got most of the restaurant companies advertising value and full-meal deals, making it harder to break through with a unique message,” Peyton admitted. However, success stories like Chili’s show that a well-executed strategy can make all the difference. Chili’s Triple Dipper and $10.99 burger combo campaign helped Brinker International’s stock soar, with a staggering 27.4% same-store sales growth in its most recent quarter.

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Defining the Right Customer: Value vs. Premium Experience

One of the biggest takeaways from Dine Brands’ struggles is that not all customers are created equal. Businesses need to define the type of customer they want to attract:

• The Value-Conscious Customer: These customers prioritize affordability and are drawn to deals like Applebee’s “Two for $25” promotion, which currently accounts for about 20% of its sales. For them, price matters more than ambiance or experience.
• The Premium Experience Customer: These customers are willing to pay more for a superior dining experience, better service, or unique menu offerings. They seek a restaurant that provides not just food, but an enjoyable and memorable experience.

Finding the right balance between these two customer segments will be critical for Dine Brands in 2025.

The Role of Social Media and Marketing Innovation

Beyond promotions, Dine Brands acknowledges the need to enhance its social media presence and connect with younger consumers. Peyton recognizes that the company must “be more relevant” and “be part of the conversation and the culture.” To support this shift, Applebee’s is searching for a new president with a strong marketing background who can lead the brand in a more dynamic direction.

IHOP, under new leadership from Yum Brands’ Lawrence Kim, is also working to reinvigorate its image through innovative menu items and improved digital engagement.

2025: A Year of Cautious Optimism

While Dine Brands is implementing strategic changes, its outlook for 2025 remains modest at best. The company projects that Applebee’s same-store sales will range between a 2% decline and a 1% increase, while IHOP’s growth is expected to fluctuate between a 1% decrease and a 2% gain.

The lesson for restaurant brands—and businesses in general—is clear: marketing alone isn’t enough. Companies must craft unique, compelling messages that resonate with the right customers. Whether appealing to value-conscious diners or premium-seeking patrons, success will come to those who know their audience and can cut through the noise with an engaging, differentiated strategy.