Anti-'Obamacare' remarks may hurt brand

Dec. 5, 2012 at 9:11 PM
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NEW YORK, Dec. 5 (UPI) -- Statements made by Papa John's chief executive officer and a major Applebee's franchise owner may have hurt their brand's reputation, U.S. brand experts say.

YouGov's BrandIndex tracks brands daily across multiple sectors simultaneously. Their scores for Papa John's and Applebee's suffered after comments concerning the Affordable Care Act, officials said.

John Schnatter, Papa John's chief executive officer, announced after Election Day he would pass on healthcare reform costs by reducing worker hours and raising prices -- an estimated 5 cents to 10 cents per pizza. This coincided with a swift negative reaction among casual food diners and its score of about 30, dropped to a score of 5, BrandIndex said. However, this might have been accelerated by a Nov. 13 class action lawsuit, which alleged Papa John's of sending unsolicited text messages to customers.

Schnatter wrote an op-ed for the Huffington Post Nov. 20 saying his comments were taken out of context, but it does not seem to have affected the brand's score, officials said.

Zane Tankel, the chief executive officer of Applebee's franchisee Apple-Metro in New York City, which operates 40 Applebee's restaurants that employ 80 to 300 people at each location, said healthcare reform would result in possibly cutting the hours of employees so they would not be eligible for health insurance. Before Tankel's TV appearance, Applebee's score was about 35, but afterwards it sunk to about 5.

Mike Archer, president of Applebee's, followed up saying: "Because final regulations and guidance are still pending from government agencies regarding the Affordable Care Act, exactly how our franchisees will implement the law when it takes effect in 2014 is still uncertain. However, we do know that our franchisees will comply fully with the law and take every measure possible to continue doing right by their employees."

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