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El Pollo Loco & Ansira Tie Up to Improve Customer Insight

Zacks

In a bid to drive customer loyalty and engagement, El Pollo Loco LOCO partnered with one of the largest independently-owned digital, customer relationship management and channel marketing agencies in the United States — Ansira, LLC.

The U.S. restaurant industry has been under the weather over the past few quarters as continued soft consumer spending on dining out has dented sales. Resultantly, same-store sales growth has been weak. Foot traffic also declined lowering profits at many restaurants.

Given the challenging sales environment, it is imperative for restaurants to understand their customers and what motivates them to drive profits. Ansira will help El Pollo Loco, by analyzing data, to improve customer insights and individual customer engagement.

Ansira’s data analysis approach will allow El Pollo Loco to better acquire, retain and engage customers as the company continues to grow and invest in its Loco Rewards program.

Meanwhile, in order to survive in a challenging sales environment, restaurant operators like Yum! Brands, Inc. YUM, McDonalds Corporation MCD and Papa John’s International, Inc. PZZA are continuously improvising the menu, re-imaging stores and offering loyalty programs. In this era consumers are increasingly looking for technological convenience, which has shaped the U.S. restaurant space as well, as an increasing number of chains are deploying technology to enhance guest experience.

El Pollo Loco has been keeping up on this front as well. The company announced the launch of several digital initiatives to boost sales, like the loyalty program called Loco Rewards. The company will continue to invest in loyalty program, which it believes will drive frequency and in turn sales in 2018 and beyond.

We note that shares of the company have underperformed its industry year to date. The stock lost 14% against the industry’s growth of 12.1%. Moreover, this Zacks Rank #4 (Sell) stock’s earnings estimates for the current quarter and year have moved down 16.7% and 6.1%, respectively, over the past 30 days. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

Nevertheless, this restaurant chain's growth initiatives, and expansion plans are expected to drive the top line as well as overall performance significantly.

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