A New Chapter for Cracker Barrel
Last summer, Chief Executive Julie Felss Masino faced a storm of criticism as she pushed forward with a major revamp of Cracker Barrel, from updating the rustic logo on restaurant exteriors to removing vintage trinkets from the walls. The backlash was intense, with critics mocking her glasses and labeling her as "woke." She even received unsolicited business advice from President Trump regarding the logo redesign and company management. Meanwhile, activist investor Sardar Biglari threatened to remove her through a proxy battle.
Despite these challenges, Masino delivered a new outlook that proved so optimistic that shares surged by as much as 35%. Her ability to survive the controversy came from abandoning her original plans in response to customer and social media backlash, and refocusing on the brand’s core customers—a move many CEOs struggle to achieve.
“What I’ve always admired about Julie is her grit and determination; people underestimate her,” said Greg Creed, former CEO of Yum Brands, who led Taco Bell while Masino worked there.
Masino told investors that her new strategy to revive the family-dining chain, which had suffered significant losses in sales, profits, and customer traffic, is showing results. Loyal customers have returned as the company refocused on serving the favorite foods, deals, and nostalgic experiences that its most dedicated fans remember.
“The food is even more delicious, made the way they remember, and the service will be out of this world,” Masino said.
One notable success has been merchandise celebrating the 250th anniversary of America and other heritage items, which sold quickly at Cracker Barrel stores. Items like U.S. Constitution T-shirts, flag pillows, and patriotic smock dresses were in high demand.
The return of nostalgic favorites such as campfire meals and ham dinners has also helped attract guests back to the restaurants.
In addition to improved earnings for the past quarter, Cracker Barrel also raised its expectations for sales and profits for the remainder of the fiscal year. The stock rose sharply, closing up over 22% and reaching its highest price since last September, when political attacks on the brand continued.
However, Cracker Barrel still faces challenges. Restaurant customer traffic declined by 6.7% compared to the previous year in the three months ending in May, an improvement from the prior quarter but still a loss that executives are working to reverse. The company's market capitalization has dropped by around $550 million from its peak last year.
Masino, who previously appeared on TV and spoke at conferences, has been less visible this year, focusing instead on internal improvements and reworking her plans. Her tone has shifted from one of renovation to preservation.
“We have been clear. We put the remodel program on pause this year, given everything that happened to us,” Masino said during an investor call.
Instead of staging a pop-up in Manhattan last year, the company is now promoting its brand at Speedway Motorsports races this summer. It is updating paint and bathrooms in Cracker Barrel restaurants but has no immediate plans to resume the extensive store remodeling that sparked so much controversy.
Many CEOs struggle to navigate controversies of this scale. Board members can grow impatient, leading to a CEO’s removal. In 2024, for example, Starbucks ousted its handpicked CEO amid a unionization drive and a social media uproar over comments related to the Israel-Gaza conflict.
When assessing current and future CEOs, corporate boards are increasingly looking for leaders who can adapt in difficult situations, both internally and externally, said Seema Threja, global head of executive recruitment firm Spencer Stuart’s hospitality and leisure practice.
“Leaders are no longer being judged in a vacuum,” Threja said. “It’s about learning agility. Can a person take a hard signal and adjust?”
Masino, recruited to Cracker Barrel in 2023, initiated a multiyear brand update aimed at modernizing its stores, menu, and design to attract new customers to the vintage chain. The company saw some promising results from food updates and marketing tie-ins when it unveiled a new, simplified logo as part of a fall campaign in 2025.
But when the redesign was rolled out more widely, it plunged Cracker Barrel into a culture war, with critics accusing it of abandoning its heritage and loyal diners. Some of the online backlash was fueled by bots.
“Cracker Barrel should go back to the old logo, admit a mistake based on customer response (the ultimate poll), and manage the company better than ever before,” Trump wrote on social media last August as the backlash reached a boiling point.
By late August, Cracker Barrel announced it would revert to its previous logo featuring the “Old Timer” icon and barrel. In early September, it suspended its restaurant redesign test. However, the company’s shares fell by more than a third by the fall from its late-July high.
Masino took action. She cut ties with the marketing firm behind the rebranding campaign and revamped the company’s leadership structure, bringing back a former vice president for menu strategy and elevating a veteran field operator to oversee store operations.
In the kitchens, workers returned to traditional kettle cooking for sides like green beans and stopped freezing biscuits in batches. Cracker Barrel asked customers for feedback and promised to keep refining its offerings.
Even so, activist investor Biglari launched a new proxy fight to remove Masino and another board member, Gilbert Dávila. Cracker Barrel shareholders voted approximately 75% of shares in favor of keeping Masino, enough to retain her position. Dávila, a marketing specialist and board member since 2020, did not receive the necessary votes to stay and resigned.
The company has trimmed costs, laid off corporate staff, and reduced big marketing spending.
At the store level, some workers reported that the company has encouraged them to sell more popular retail items like squeezy children’s toys, along with drinks and take-home meals. They have also been urged to greet guests quickly, even during busy hours.
While weekends remain busy, weekdays can still be slow. Restaurant visits have gradually improved this spring, but remain down by 5.7% in May compared to the previous year, according to Placer.ai, which tracks foot traffic.
Restaurant teams and executives are focused and working hard, Masino said, but Cracker Barrel’s recovery remains fragile. The company warned that rising gasoline prices and lower-income consumers cutting back on dining out could affect sales.
“It’s just some real hard work,” she said.
No comments:
Post a Comment