Saturday, March 18, 2006

Marketing Analyst: Avoid Calling Denny's Copycats

Marketing analyst says: "If the media uses terms like copycat or copycat killers, then people might be less likely to eat there."


Originally published Saturday, March 18, 2006
Experts doubt California attacks will harm restaurant chain

By Muhammed El-Hasan

Unfazed by the news of three fatal shootings at Denny's restaurants in California this week, Lidia Azouz had a meal Friday at the Lawndale Denny's and said she'd be back.

"We're not going to stop coming to Denny's, because we take chances wherever (we) go," said the 17-year-old Hawthorne resident as she stood outside the restaurant with four friends. "You could be driving a car and get shot."

With broad media coverage of the shootings, it's unclear how they would affect business at Denny's restaurants.

As long as customers like Azouz view the violence as isolated and random, then the restaurant chain's business would likely not take a hit, according to some analysts contacted Friday.

"Financially, I really don't see a big impact," said Mark Smith, an equity analyst with Sidoti & Co. in New York. "I think that most people realize that this is just random. ... If Denny's had somehow been responsible, if it was a manager of a restaurant, if they had some exposure to litigation from this, then I think it would have an impact. But I doubt that will happen."

Business likely would slow at the three affected Denny's restaurants, but there shouldn't be problems elsewhere, said Ron Paul, a food industry analyst with Technomic Inc. in Chicago.

"Denny's has a lot of stores, so three stores are not going to put the place under," Paul said. "I don't think it's going to affect other stores."

But some customers may shy away from eating at any Denny's restaurant, said analyst Bob Sandelman, of Sandelman & Associates in San Clemente.

"People probably realize that it's not Denny's fault," Sandelman said. "But people would rather be safe than sorry. And I can see how people might say, 'Hey, let's go somewhere else for now and see what happens.' "

Sandelman added that the amount and approach of media coverage could hurt Denny's.

"If the media uses terms like copycat or copycat killers, then people might be less likely to eat there," Sandelman said.

The Associated Press contributed to this article.

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