Interesting article on CEC in Dallas Morning News Today

[captslappy]

There was a nice 2 page article in the Dallas Morning News about CEC today. They even got some comments on Nolan Bushnell who says that he thinks the restaurant isn't very innovative. He also dislikes the fact there is so little human to human interaction. He said that this is not the direction hew ould have taken it. His comments are pretty brief. I will see abut getting Vega Nova or someone else the article to add here. Please don't email asking for a copy. Right now I don't have time to mail a bunch of copies or to scan and email it to a lot of people. I will see if I can find an online way to share it with the group.

[chuckrules]

Wow. I'll be looking forward to seeing this on here.

[pizzacam]

Dang I'll buy it here and try to get it on the message board

[puppetmaster29]

I believe this is what you are looking for........

Chuck E. founder smells aging Cheese

He wonders if chain needs new recipe


02:47 PM CDT on Saturday, October 28, 2006

By KAREN ROBINSON-JACOBS / The Dallas Morning News

Serial entrepreneur Nolan Bushnell founded the Chuck E. Cheese's chain of pizza and playland restaurants nearly three decades ago.

"Chuck E. Cheese's should be an innovative entertainment place," said Mr. Bushnell, who launched Chuck E. Cheese's Pizza Time Theater in 1977, about six years after founding video game pioneer Atari Corp.

"It's still animals, attractions, the ball crawl. I don't see a lot of innovation or change. I think it's gotten a little stagnant."

Mr. Bushnell, 63, hasn't had anything to do with running the business since 1983. The publicly traded chain is now owned by Irving-based CEC Entertainment Inc.

Still, his comments highlight the hurdles facing a brand that was born not long after video games.

How do you keep a soon-to-be 30-year-old looking like a spry young thing that can captivate today's techno-savvy tikes?

"I definitely think it's hard," acknowledged Richard Frank, the chairman and chief executive, a longtime veteran of the business who joined a predecessor company, Showbiz Pizza, in 1985.


uWink
Nolan Bushnell launched Chuck E. Cheese’s Pizza Time Theater in 1977, about six years after founding video game pioneer Atari Corp. He hasn’t had anything to do with running the restaurant chain since 1983. "It's a never-ending challenge and probably one of the single biggest challenges that we face."

He added: "I do think we've done a reasonably good job."

Many shareholders would agree.

CEC, which is scheduled to report its third-quarter results Tuesday, went public in 1989 and has seen its market capitalization climb over that period from less than $13 million to nearly $1.2 billion.

"Over that 20 years, just the value of the company speaks to the fact that the management and our people have done a reasonably good job of repositioning the brand," said Mr. Frank.

To Mr. Bushnell's point, average annual revenue per restaurant at Chuck E. Cheese's has been fairly flat over the last few years, stuck in the $1.6 million range.

However, a pretax return on assets of more than 20 percent "puts them in the top 5 percent of businesses in the U.S.," said analyst William Baldwin, a principal with Dallas-based Baldwin Anthony Securities.

Mr. Frank expressed great admiration for Mr. Bushnell and the work he's done. Likewise, Mr. Bushnell, in Dallas recently for a restaurant conference, did not want to come off sounding like a Chuck E. basher.

After all, he was responsible for the company's early growth. By the time he left the company 23 years ago, there were more than 280 stores with annual sales of more than $350 million.

But after launching a chain that was largely centered on arcade-style video games, Mr. Bushnell said he's become less of a fan of that genre, fearing that it lessens human-to-human interaction.

"That's not what I envisioned," Mr. Bushnell said of the brand in its current form. "I envisioned people having fun together. That's not the Chuck E. Cheese experience."

These days he's bullish on the prospects for his newest offspring, uWink Bistro, an entertainment-themed restaurant in the upscale Woodland Hills section of Los Angeles.

The restaurant, which opened Oct. 16, features a touch screen at each table to order food and drinks. The screens also contain games that can be played with other tables or as a stand-alone diversion.

"All of the games are social in nature," he said, adding that they appeal to women in their 20s and 30s. "It's about a relationship among people. The games facilitate that," he added. "There are no games where you have a love affair with the screen."

Chuck E. Cheese's sees its audience as families – primarily moms – with children ages 2 to 11. The average age is about 6, and the company has made a conscious decision not to go after the teen market.

Much of the focus of its innovation has been related to keeping the outlets safe and welcoming, said Richard Huston, executive vice president of marketing, who also came in 1985 as one of Mr. Frank's first hires.

Mr. Huston pointed to features such as the matching hand stamps for parent and child and the removal of walls that make it easier for parents to see their young ones across the room.

The company replaced the ball crawl (a pit filled with soft plastic balls) with climbable "sky tubes" about nine years ago, again for safety reasons.

"Kids are fairly happy with Chuck E. Cheese," he said.

And for the most part, that makes parents fairly happy too.

"Every time we want some fun time with the kids, we come to Chuck E. Cheese," said Patricia Souza, a North Dallas resident visiting a Plano outlet with her husband, Jorge, and their children, Raquel, 10, and Rafael, 6. "It's close to home and they love it."

"We feel safe when we come here with our kids," she added. "Other places, I was concerned because the kids could open the door and get out."

Richardson resident Andrea Lee was visiting the Plano store with daughter Alexandra, 12, and granddaughter Jada Clark, 4 ½. She's seen lots of change since she began bringing her older children to Chuck E. Cheese's 20 years ago.

"It's change for the better," Ms. Lee said, as Jada climbed across the table.

Jada especially likes the faux television studio.

"It makes it look like she's on TV," said Ms. Lee. "I think it's still exciting for the kids ... for the age group that comes here."

Mr. Huston said the brand's games are "way different now than they were 20 years ago."

There are more action simulators and kiddie rides, such as the new horse-drawn carriage.

This year, the company plans to invest about $50 million to upgrade 153 company-owned stores. About half of that money will go for games, rides and attractions.

"They've got much higher quality games in the store [now]," said Mr. Baldwin. "That should have happened a few years ago. I think if you were going to fault them on anything, it would be that they were a little slow on the uptake on the games."

One aspect that many parents find unchanged is the food. And that might not be such a good thing.

"The one thing I would improve is the food," said Ms. Souza. "It seems exactly the same as 10 years ago, maybe even 30 years ago. I wish they had more options, different options."

Earlier this year, parents visiting a nearby children's playland called GattiTown cited the difference in food quality as the deciding factor against going to Chuck E. Cheese's.

"We do get that [suggestion] quite a bit," said CEC spokeswoman Brenda Holloway. She said that as the company remodels stores, it's expanding the salad bar area and adding items to the menu.

"Are we going to have rack of lamb? No," she said, adding that the company focuses on using quality ingredients for the items it does offer.

Mr. Frank said the company will continue to update its image. But he was quick to describe the process as more evolutionary than revolutionary.

"We have carved out a niche in the last 20 years that we think is unparalleled here in the country," said Mr. Frank. "And when you have a niche that's so well defined, you also need to be careful that you're not making so many changes that you ... move away from your customer base."

"We're comfortable that Chuck E. Cheese's does not need a major overhaul or a revolution," he added. "We just want to maintain the vitality of the business."

[captslappy]

Yes... here is the link: www.dallasnews.com/sharedcontent/dws/dn/latestnews/stories/1028dnbusChuck.2e965dd.html (http://www.dallasnews.com/sharedcontent/dws/dn/latestnews/stories/1028dnbusChuck.2e965dd.html)

[chuckrules]

I saved the link. And printed out this recent CEC article.:D :)

[Shiney Happy Jenn]

Quote from the above ariticle by Dick Frank:

"We're comfortable that Chuck E. Cheese's does not need a major overhaul or a revolution. We just want to maintain the vitality of the business"

And THAT my friends is why CEC is in the stalemate it is, and has been for some time now!

It's THAT kind of narrow-minded thinking that has created a creative stalemate within the concept. It's infuriating hearing this coming from the CEO for Chuck's sake! I think the above statement from Mr. Frank pretty much sums it all up.

( Blood starts to boil at this point.....>: )

To Hell with furthering the concept in exciting new entertaining ways....let's just keep the status quo and cash in on simply the brand name.

But would'nt it be better to have that "brand name" associated with something GREAT and EXCITING...like what CEC used to be? I'm not saying we need to go back to the Old Days as i am being realistic and know full well that would be pointless in today's times. What i mean is, would'nt it be better to have your name associated with those things today? CEC is perfectly capable of introducing amazing new concepts in there stores to today's kids and families. Instead, the vibe seems to be that it's more important to make a good stock quote. Today CEC has come to mean a good time..yes, but like the article points out, many Guests have issues with the poor food quality and ( unmentioned) the expense. It has always bothered me that the Company constantly takes the cheap way out when it comes to things ( not everything mind you...but in general on many levels seems to be the impression one is left with sometimes.). It's such a shame, even though i know full well that a business does need to cut costs at times.

There is so much MORE CEC could be doing to wow it's audience but does'nt seem to give a toss. Instead of taking steps to take things up a couple of notches, they are content to simply sit back and collect the checks.

Grrrrr.......my fires have been stoked again now!

>:

[Shiney Happy Jenn]

Reading the above again..

God these high-ups are so freaking BLIND!!! If they could see where most stores are now, and the Guests' perception of the concept currently, maybe they would realize that YES, CEC DOES NEED A OVERHAUL!!

YES, it does need a "revolution"! It needs better shows with the latest animatronics and more money put towards the Entertainment Department!

There will be NO "vitality of the business" if things keep going the way they have over the past few years. Why can't they see this? Those big-wigs up in the glass conference room need to get off there duffs and get down to a CEC location and PERSONALLY experience it. Sales numbers DO NOT tell the whole story!!

>:

[chuckrules]

True. Very true Jenn.>: :(

[CEC3066]

I know for a FACT Dick & Mike BOTH are on the road a LOT visiting the stores my Question is do they just drop in say hi grab a cup of coffee and leave there is NO F'ng way they are paying attention to what is imporant. how much longer do you give this company Jenn? at this rate I say 3-5 years and they're dead.

[Shiney Happy Jenn]

I don't see CEC going under anytime soon really.....they will surely still be around for a while longer as they ARE successful in there nitch.

I think of LOT of the reason is for the "nostalgia factor" with today's parents. Today's parents who take their own kids to CEC's went there themselves as children in the 80's. That has massive appeal in itself....that whole sentimental buzz and all. The "brand recognition" is half of that alone....the fact that yesteryears Guests remember the great time they had at PTT/CEC and now want to share that with THEIR kids. This is great...i am all for that...but the problem i see is too many Guests come away feeling cheated. Many times i have overheard comments about how it's not as "cool" as it used to be. They remember it being a cutting edge, exciting and fun place for the ENTIRE FAMILY...not just the toddlers and kids under 5! This is where The Company is missing the boat big time. They don't seem to "get it" and they never will unless they recieve more feedback from these Guests, or do better research then just looking at sales numbers. Why exclude the older kids and the parents from the fun? Most adults and kids above the age of 6 seem bored or utterly annoyed at the lack of activities to interest them. Why does CEC insist on targeting only the little ones, such a small angle? Why not hit everyone...like CEC originally did ( much like Disney). Disney is bigger then CEC can ever hope to be and a huge reason is because The Disney Company caters to EVERYONE...not just the kids! CEC can learn a lot from that....they are missing millions of dollars by targeting so narrow a audience in my mind. It makes no sense to me really....

Another thing why CEC is successful and why they continue to be is that they have NO COMPETITION these days. Without a similar competitor to worry about, keeping them on the edge of there seats in anticipation, CEC can basically just sit on there butts and not do a damn thing to improve the Guest experince. They DON"T HAVE TO! They are the ONLY "game" in town since they have bought out and eliminated anyone who came even close to them! Things were different when Showbiz Pizza was around ( which the current company originally started...) With the heavy competition from Pizza Time Theatre, Showbiz had to scamble and bulk up it's offerings to kick PTT/CEC's tush. The fiece contest for the Guest's dollar in the 80's was fantastic and classic in all senses as it brought out the BEST that both companies at that time could offer. We saw better entertainment concepts arrive at both concepts, expanded menus, better buildings and locations.....plus all the neat stuff us fans love. Each one was trying to out-do the other, wether it be the latest games, the coolest shows, themed dinner nights, token specials, you name it. It was fantastic! It has been said that competition is one of the best things for a business and it's the truth. It makes a compnay have to WORK for there peice of the pie, not lie back and light em'. The fact that CEC does'nt have to "wow" anyone anymore is because of lack of this.....they don't have to worry now since they are the only place like it in most towns.

CEC is a great concept, but sadly over the past few years it has been diluted to the point of homogenized mush that can only be digested by a 3 year old. It's a shame, as the concept has SUCH potential ( PTT era is a excellent example in it's day....in that time). With today's advances in robotics, video screen technology, lighting effects, not to mention games and other arcade attractions, there is NO EXCUSE why CEC can't be better then it is now. It's a multi-million dollar entity that is at a creative ebb and it needs to wake up fast before it finally sinks. It will happen someday....maybe take some time, but mark my words it will happen if things continue at this rate. Like i have said before, CEC needs to STOP opening "35 new stores" a year...and START reinvesting in it's exsisting stores. One good way of doing this is to introduce new entertainment concepts and get Guests excited again about coming back to CEC.

I should state that these are some heavy topics...and i just want folks to know that i am not meaning to come across as if is am blanantly having a bash at the Company. I am doing so as i care a LOT about this concept and it drives be bonkers when i see how much they are missing and what they COULD be doing and what they COULD become. I have always had a fierce passion for this concept known as CEC, since 1981. It's disturbing to sit here and read statements like the above by Mr. Frank realizing how blind the uppers seems to be, and how they have no desire to further their concept in the innovative ways it was originally founded on.

I pray they see the light...and soon!

[Shiney Happy Jenn]

Just bumping this up, as it relates to a dicussion we are having in another thread.

[Rapid T Rabbit]

If all CEC corporate is thinking about is maintaining their current statue quo...sadly in many respects they have actually retreated in terms of the entertainment value, particularly wherein Chuck E's personal presence on the premises is concerned.

Maybe I'm just venting sour grapes here after having getting to spend 3 hours per visit with Chuck E., to spending an entire day with him, to nothing at all now.

[sungun12]

i really dont see cec going ANYWHERE - EVER. i mean, come on. there will always be kids. kids who want to go to chuck e cheese. that was me when i was little. i was there all the time.

you gotta remember this, too. do you remember chi chi's? anyone?? chi chi's was a pretty famous restaurant, for being a mexican restaurant, and then they started jacking around with the menu and then completely changed it totally and now where is chi chi's? huh? GONE. cec has been around forever and totally killed any other concept that ever tried to compete. remember discover zone? i took my brothers there once and it was DISGUSTING. the concept DOES work, and it always will. i dont see it going anywhere, my store was up a TON this year from last year. man, i really hope it doesnt go anywhere, kind of never thought of workin anywhere else, you know??

[Shiney Happy Jenn]

At the current rate of expansion, cutbacks, and the gradual decline in quality, from my standpoint i see CEC's eventually falling away unless they take some measures to keep the concept up to par.

I see things in a gradual decline, and have been seeing this for the past few years. Numbers do not tell the entire story...and tricky businessmen always have a way of making the numbers seem rosier then they actually are. I'm not saying that Store's are being missled and lied to.....i'm just saying that trusting fully in a Company that has lost some of it's focus is risky.

I think CEC could be doing a Hell of a lot more then it currently is...and i'm certainly not talking about more expansion/more locations! I'm talking about BETTER entertainment, QUALITY food offerings/variety...and a step away from the acursed "Toddler Only" appeal factor. What drives me the craziest though is the bigwigs who have control over this great concept who do nothing but sit on there butts and collect the profits, but so NOTHING to improve it!

That is what gets me the most worked up.

CEC as a concept obviously works, and that is in tribute to Nolan's original idea. Pure genuis if you ask me....and the fact that CEC is still around today, although in a highly dilluted and homgenized form, is proof of the original concepts lasting capabilities.

At least we still have Animatronics there....

;)

[bzier]

Yeah, this ticks me off too, and I know in talking with my current GM and the previous GM of my store, they both agree that the company went overboard the last few years in opening new stores and cutbacks in show and food.

I like the new Salad bar and sandwich presentation, and while it is alot more work, it's a step in the direction of quality product.

I'm glad to see they want to remodel, even though I'm not a big fan of the 'new look'....at least interior-wise.

As for the show, obviously we all know about that. They've gotten so dang cheap, and better begin to invest some more cash into the Entertainment department and into building better shows or else they'll completely lose half of what makes CEC different from everybody else.

I just hope these guys realize the trouble they're gonna be in in the next ten years or so if they don't get back to being creative. I agree with you Jenn...let's make this a place for everybody, not just the toddlers!

[Shiney Happy Jenn]

( Slaps Bzier a high five.....and could almost do that for real since i am currently in Orlando!)

:D

[CEC3066]

i'm trying Jenn I myspaced him to tell him you are in the area I even have his cell # if he will allow me to give it to ya PERHAPS a visit to Brandon might be in the cards, IF SO I think it'd be cool to get a couple of pics one by the stage in the same spot you stould where the Balcony show was and the other where you sat and watched Artie, just to kinda see how things changed since then.

[Shiney Happy Jenn]

Sounds great!

I will have to see if i can fit it in....for years i have wanted to re-visit Brandon. It was there it all started for me, and i have not been back since 1983!

[bzier]

Well Jenn, trust me, A LOT has changed at that store since then. There are definitely some older relics and the store has an older feeling than all of the other stores down here.
It's just too bad that Dan, the store's tech, doesn't spend more time and money fixing up that show. What a waste. >:

[Shiney Happy Jenn]

Just bumping this up as my recent signature quotes have sparked interest in the original aritcle. Well worth reading too......

Enjoy!