3 Lessons to Learn From Cracker Barrel’s Rebranding Mistakes

Unless you’ve been isolated on a remote island with little to no connection to the outside world, you’ve likely heard about the recent marketing blunders at Cracker Barrel, the 46-year-old Southern restaurant chain. Multiple articles have examined the situation, indicating that the senior executives failed to understand their customers and the changes needed to regain their enthusiasm.

Over the past several decades, there have been numerous examples of marketing mistakes. You might assume that future marketing executives have learned how to avoid similar errors; however, there will always be clients and marketing or public relations firms willing to take risks.

Some of the more memorable examples include:

• Coca-Cola replacing its original formula with “New Coke”

• Kendall Jenner’s Pepsi logo can ad

• Ayds Diet Candy ad debuting as the AIDS epidemic started

• Bud Light promoting a controversial influencer

We could provide numerous additional examples, including Cracker Barrel. More importantly, I’m curious about the costly rebranding and marketing mistakes made and the lessons we can learn from them.

Related: 3 of the Biggest Risks That Come With Rebranding — and How to Overcome Them

Do you really know your customer?

Before we talk about marketing mistakes, let’s cover why I believe most of them are made. Everyone thinks they know their customers well. Yet I have two questions.

1. Do you truly know your customers — like, really know them?

2. If so, do you feel confident about their likes and dislikes of your service and quality levels?

I often pose these questions to myself and to fellow entrepreneurs: Do you truly understand your customers? Many respond with confidence, believing they grasp their customers’ needs and feel they meet or even exceed expectations. However, there are times when they express uncertainty, feeling they don’t fully comprehend their customers’ true expectations.

As an entrepreneur and CEO, I dedicate much of my time to managing the daily operations of my company. However, I also invest significant time in researching marketing concepts, particularly in digital and social media strategies. I genuinely enjoy working with the latest technology. While new technologies add value to my work, I also recognize the immense importance of direct communication with customers and the implementation of fundamental marketing strategies.

Talk with, not to, your customer

When it comes to understanding my customers, I take an approachable method. I feel that I can gauge my customers’ wants and needs because my staff and I actively engage in conversation with them. In fact, we prefer talking to our customers rather than relying on email, text or chat boxes.

Our company is dedicated to addressing our customers’ needs by ensuring we are available for both existing and new clients. We adhere to a same-day communication policy. Even if we don’t have an immediate answer, we follow up with a proposed timeline or commit to providing the necessary information as soon as possible.

Additionally, we personally call each client when a transcription is delivered. We ask if they are satisfied with the transcription and if there is anything else we can assist with. Recently, a new customer stated in a follow-up email that, “It was easy to get a hold of representatives by phone and email.”

Some of you may be thinking, “I have tens of thousands, or even millions of customers. There’s no way to communicate personally with each one.” I understand, but there are still effective ways to get “up-close and personal” with your customers.

• Analyze customer data: Extract essential data from your Customer Relationship Management (CRM) system to understand buying habits and trends.

• Gather direct feedback: Ask customers about their likes and dislikes.

• Analyze competitor data: Are your competitors offering similar or unique services?

• Walk in your customers’ shoes: Become a customer, i.e., ghost shop your retail or online stores.

Regardless of your company’s size, if the CEO or owners are not directly communicating with customers, particularly the smaller ones, you are missing a valuable opportunity to understand their thoughts and feelings.

Related: 3 Methods to Help You Determine What Customers Really Want (and Really Don’t Want)

Rebranding mishaps

In my opinion, most rebranding failures stem from internal rather than external factors. Executives often become enamored with ideas that customers have not asked for. A classic example of this is Coca-Cola’s introduction of “New Coke” in 1985, which involved phasing out the long-established “Classic Coke.”

According to The New York Times, Coca-Cola had a 32.3% market share compared to Pepsi’s 24.8 percent share in 1985. Were customers demanding that Coke change its formula for a smoother, sweeter taste? No, they were not. However, the executives at Coca-Cola believed that making Coke taste more like Pepsi would help increase their market share. In this instance, it seems that company leadership misjudged their customers’ emotional and nostalgic attachment to their flagship product — a simple but costly mistake.

The recent Cracker Barrel fiasco presents a different scenario. Senior executives seemed determined to eliminate any “rural themes” from the restaurant, leading to the creation of a new logo that no longer features the iconic “Uncle Hershel” character. Additionally, they introduced redesigned dining areas with a brighter interior while removing the “country decor” that has made Cracker Barrel famous since 1979.

There’s little doubt that Cracker Barrel’s interiors and menu could use a refresh. However, customers strongly opposed the new logo design and rumors of a complete restaurant remodel. Were Cracker Barrel customers actually demanding these changes? Apparently not.

Hiring a San Francisco-based marketing agency to rebrand an iconic restaurant chain with deep Southern roots was likely not the best decision. Cracker Barrel ultimately announced that it would retain its current logo and had parted ways with Prophet, the San Francisco marketing agency. The company’s CEO recently stated at an investor summit that the logo rebranding was intended to make the logo more recognizable on billboards. However, logo and brand recognition were not significant issues for customers.

The main rebranding lessons for both Coca-Cola and Cracker Barrel are similar: Understand what your customers truly want and do not underestimate their nostalgic connection to your brand.

3 rebranding lessons

Rebranding remains an important tool for any company, but there are several factors to consider before implementing major changes.

First, consider whether the proposed changes reflect your customers’ desires or just your own. Executives often become attached to ideas that customers may not want or appreciate. While I don’t have access to Cracker Barrel’s customer data, it seems likely that it was company executives, rather than customers, who wanted the updated logo and complete dining room makeover.

Lesson learned: Brand equity and emotional connection can outweigh product improvements. When making significant changes, tread carefully and test broadly.

Attempting to “appeal to everyone” can dilute what makes the brand unique. Once a rebranding strategy is in place, ensure that your customers understand the reasons behind the changes. It’s important to recognize that not everyone will be pleased.

For example, in 2009, Pizza Hut, a well-established restaurant chain, decided to rebrand itself as “The Hut” to attract a younger audience. However, this strategy failed because customers found the change inauthentic and forced. While they aimed to attract a younger demographic, their long-standing customers were put off by the new name.

Three years ago, I changed my company’s name from Transcription Outsourcing to Ditto Transcripts. This change was deliberate and costly.

One reason for rebranding was that potential customers often asked if we “outsourced” our work, implying that we used overseas transcriptionists. In reality, we only employ U.S.-based transcriptionists because we believe that producing high-quality transcripts requires skilled employees whose backgrounds we can verify. Although the rebranding campaign was expensive, it resulted in increased business and more inquiries from new customers.

Lesson learned: Make certain any change has purpose and can be easily explained.

Related: The Strategic Guide to Successful Rebranding

Keep the main thing, the main thing. In other words, keep the core of your business recognizable. Change is difficult for most people. Nevertheless, if done with purpose and clarity, most customers will react positively. However, make sure that your core business, your bread and butter, remains the same and is easily recognizable to loyal customers even after changes are implemented.

Weight Watchers built a successful business by educating millions of people about the benefits of counting calories and eating healthy meals. Their pre-packaged meals and eating guidelines helped people shed pounds and inches.

In 2018, Weight Watchers changed their name to “WW,” which meant “wellness that works.” The company wanted to move away from the “diet” mentality and adopt a more generic brand name. However, the change did nothing but confuse people. Why? No one understood what “WW” meant. The mishap resulted in a 35% drop in share price and lost memberships.

Lesson learned: Don’t abandon brand recognition unless you have a stronger, clearer message to present.

Launching a rebranding campaign can offer significant long-term benefits, but if not executed correctly, it can also damage your company’s reputation and value. Entrepreneurs often encounter various challenges, and if rebranding is on your agenda, ensure that you learn from past mistakes and have a clear understanding of your customers’ wants and needs.

Unless you’ve been isolated on a remote island with little to no connection to the outside world, you’ve likely heard about the recent marketing blunders at Cracker Barrel, the 46-year-old Southern restaurant chain. Multiple articles have examined the situation, indicating that the senior executives failed to understand their customers and the changes needed to regain their enthusiasm.

Over the past several decades, there have been numerous examples of marketing mistakes. You might assume that future marketing executives have learned how to avoid similar errors; however, there will always be clients and marketing or public relations firms willing to take risks.