Why Restaurant Chains Operate Under Multiple Names Despite Identical Food

Introduction

The practice of restaurant chains maintaining multiple names for their locations is not uncommon, especially in the United States. This phenomenon is best illustrated through the examples of brands like Ponderosa/Bonanzas and Rally’s/Checkers, which operate under both names in different regions, despite serving the same type of food. Such a practice raises the question of why restaurants with identical food products maintain different brand identities. This article explores the reasons behind this practice, focusing on mergers, regional branding strategies, and the preservation of brand equity.

The Case of Ponderosa/Bonanzas and Rally’s/Checkers

Rally’s and Checkers were originally separate restaurant chains but later merged. Even after the merger, both names remained in use because of the established brand equity of each company. A similar situation exists with Ponderosa and Bonanzas, which shared the same namesake due to being part of the same chain. Additionally, Hardee’s and Carl’s Jr. operate under two names for similar reasons, such as mergers and the desire to maintain brand recognition.

The practice of maintaining multiple names is often driven by regional branding. Each location is tailored to the preferences and demographic of its specific area. For instance, Panera and Saint Louis Bread Company, as well as Carl’s Jr. and Hardees, use different names to cater to the market research and customer preferences of each region.

The Role of Market Research and Brand Equity

Market research plays a crucial role in determining which name would resonate more with the target audience in a particular region. By preserving the original names, the merged chains can leverage the established brand recognition and customer loyalty, ensuring a smoother transition and avoiding any potential loss of sales. Even though the food and menu items remain the same, the brand identity can influence customer perception and preference.

For example, Ponderosa and Bonanza operated side by side in the La Crosse Wisconsin area where the author grew up. The Bonanza closed first, and the local Ponderosas likely followed shortly after. Despite the close proximity and similarities in the brand names, both locations were focused on the same core elements: the food, ambiance, and overall experience associated with the Bonanza TV show.

Conclusion and Future Outlook

In conclusion, the presence of multiple names in restaurant chains serves several strategic purposes. Whether through mergers or regional branding, the aim is to preserve market recognition, customer loyalty, and provide a tailored experience that appeals to the local audience. This practice ensures the continued success and growth of the restaurant chain, even in a highly competitive market.

It is worth noting that despite these strategic reasons, the practice is not without challenges. Balancing the need for brand equity with the desire for a unified corporate image is an ongoing challenge for many restaurant chains. However, for brands like Ponderosa/Bonanzas and Rally’s/Checkers, the decision to maintain separate names appears to have been successful, as both brands continue to operate.

Keywords: multiple names, regional branding, restaurant mergers