Don't Drink the Tea. Think With the WE.
Dec
2012
6

Papa John’s, Darden Restaurants Suffering Reputation Damage, Stock Value Loss Following Anti-Obamacare Statements

In the lead up to and immediate aftermath of the November general election, corporate leaders from both Papa John’s and Darden Resturaunts threatened job losses and hour slashing should President Obama be re-elected to implement the Affordable Care Act. Now, those same companies appear to be paying the publicity price for their vengeful comments.

Since their remarks, Darden Resturaunts has cut their profit forecast for the next year after seeing their stock drop 8%.

There are many factors to consider when making a profit forecast, to be sure. In addition to negative PR Darden is managing a new merger with Yard House USA and loss of business after Hurricane Sandy. The former, the merger, one would expect to boost profits, though, not squash them.

With respect to Papa John’s, recent research by the YouGov Brand Index shows that the company is suffering from reputation damage:

Papa John’s, Applebee’s, and Denny’s were measured with YouGov BrandIndex’s Buzz score, which asks respondents, “If you’ve heard anything about the brand in the last two weeks, through advertising, news or word of mouth, was it positive or negative?” Results were filtered adults 18+ who have eaten at casual dining restaurants in the past month.

Papa John’s Buzz score high point for the month came on Election Day—November 6th—with a score of 32. Eight days later, the score had dropped 10 points down to 22, when the spam text lawsuit was unveiled. A few days later, Papa John’s dropped below Pizza Hut’s score and is presently at 4.

Another glaring example of the drawbacks of undermining health care for all came when a Denny’s franchise owner suggested he would be adding an “Obamacare surcharge” to his location’s checks. He was promptly rebuffed by the owner of Denny’s:

Denny’s chief executive John Miller privately reached out to Metz to express his “disappointment” with the Florida franchisee’s controversial statements about Obamacare, which sparked a wave of backlash for the national restaurant chain over the past few days. Metz released a statement Monday night expressing “regret” over his statements.

“We recognize his right to speak on issues, but registered our disappointment that his comments have been interpreted as the company’s position,” Miller said in an email to The Huffington Post.

Sadly, it sounds a little like Miller was simply doing PR work of his own, not that he earnestly disagrees with the idea of dodging Obamacare. Hopefully the negative feelings toward companies who desire to take such drastic measures will deter Miller and folks like him from going that route.

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