How Popeye's Chicken Sandwich Harnessed Social Media

out there in the marketplace. Popeyees is going up against Chick fil A in a Twitter war over which chain has the best chicken sandwich. I wasn't aware of it until just a day or two ago, but I'll tell you, I know it's pretty Who is aware of it. That is Mike Klin, Mike's senior restaurant analyst for Bloomberg Intelligence. He joins us on the phone. So, Mike, um, again, I'm not a big fan of the fried chicken sandwich.

Tell us what's going on out there? Uh? Yeah, so so Popeye's debut, Uh their version of the chicken sandwich. You know, it's it's been the kind of a long time coming. I mean, they're really knowing for their bone and chicken, you know, so I guess this is kind of low hanging fruit for relatively new owner restaurant brands. And uh, you know, it came out and had some

spectacular reviews and um. Surely after the sandwich debut, Chick fil A posted a tweet about their um their chicken sandwich, and Popeyes responded with y'all good, and it just sparked this massive Twitter war with you know, Wendy's jumping in the fray and Mike before which sandwich was better? Yeah, Mike, before you going further. I mean the idea that this is innovation is sort of amazing to me. It's you know, it's basically this company that focuses on chicken sitting around

a boardroom and saying, I have a brilliant idea. Why don't we put it between bread? I mean, what's the

big deal? What is so special about these chicken sandwiches? Well, listen for I mean, chicken sandwiches have just continued to grow in popularity, right, it continues to take kind of share from from burgers, you know, I mean, will look at it, you know, obviously fried chicken sandwiches aren't that healthy for you, but they look at it as a healthier alternative to burgers, and people are into chicken, right, and um, you know, Popeyes has a lot of fanboys,

you know, I mean myself included. I absolutely love Popeyes. So I think when one did come out, there was uh, you know, I think Popeyes knew there was going to be a lot of buzz about it, right because, like I said, this is kind of a long time coming. You know, I don't think they saw this level though of of you know, like this this fever pitch obviously about about the sandwich. You know, it's it's interesting, like I've been reading and there's been apparently a shortage of

chicken sandwiches for Popeyes. I've actually run out and as a so what's that say about the supply chain? Like where all the chickens going? Yeah, so that's interesting. So what I'm hearing it was that it was the buns. Um, I wouldn't be surprised if it's chicken as well, right, because these chicken sandwiches have to be made made to specifications by the supplies, And what Popeyes are saying is,

you know, we already burned through. You know, in two weeks, we burned through all the supply we had pegged for um August and September. UM. So I won't be surprised if they did run out in some stores. You know, I don't think all stores are have run out, but I think what they're trying to do is kind of uh, you know, uh stop themselves from disappointing customers. You know, so, but they have it sounds like they have run out

the supply chain. Um. You know, the supplier has to start making chickens and getting their hands on some buns because you know, obviously the demand is there. I mean also there's some speculation that they've deliberately restricted the supply um to kind of create even more hype, right, so like you have a sandwich now that everybody wants, but not everybody can get, so they can kind of um,

you know extend you know, then the marketing behind this. Yet. Yeah, just to give you a sense of of the flip side, the dark underbelly of the craze, I was working like a slave. This according to one exhausted Papaye's employee, who is describing the harrowing experience of trying to uh serve this incredible craze. I'm wondering if you want to take a broader kind of take on this, what this says about Twitter and the use of it in terms of

marketing for some of these fast food companies. Because we've seen this increasingly sort of burger King versus McDonald's or you know, just the rivals kind of going back and forth and trying to be pithy it. How much increasingly is that a mainstay of the advertising tool for some of these fast food chains. Yeah, that's a great question. Then there's a couple of pieces to that question. But the first thing I'll addresses them the you know, the

marketing piece. I mean, listen, this is it's very low cost for you to hire, you know, a few marketing interns and have them tweet on your account all day. It's a lot cheaper than buying um television, which still has an R o I on it, but or buying radio time, or or putting ads in magazines very very high r o EYES associated with social media marketing. Um,

you know, you're advertising directly where your customers are. Right, Like, my son doesn't watch TV anymore, but he has his phone in his hand all the time he's basically walking around with a billboard in his hand. You know. So, uh, this is gonna continue. Um, we we think it's just gonna Social media marketing is just going to continue to be a larger percentage of the AD budgets of these companies. You know. The other thing you mentioned about the employees, Um,

that was kind of interesting. Yeah, there was an article out last week about a few a few Popey's employees that were talking about a horrible experience. They were so busy they quit mid shift. You know. But um, you know, I'd caution about believing everything you read in that article. I mean they only you know, Popeyes has thousands of stores and there was only there was only five employees interviewed. Um. You know, I know growing up working in a car wash when the day was busy, it went a lot

faster and I kind preferred preferred it that way. So, uh, you know that that there's been a lot of hype and a lot of politicizing I guess of of this situation. You know, Mike Calin, thank you so much for being with us. Mike Calin, senior restaurant analyst and car wash expert for us here at Bloomberg Intelligence joining us on the phone. Have you had one, Paul? I have not, but now I have to go. I mean there's a line out the Chick fil A on electionson Avenue every day.

I know, but it's it's really just chicken on bread, right, I mean, what what I'm just, I'm sort of my mind is boggled. People are getting older and they need health insurance and they want to get it less expensive than it is in most places. Enter e Health, which is a company who shares have returned more than two d P over the past twelve months. Joining us right now. Scott Flanders, chief executive officer of the Health U from Mountain View, California. Scott, thank you so much for joining us.

So just tell us a little bit about, uh, the provenance of the health dot com. Well, we started over twenty years ago helping individuals and families compare insurance plans, and then we evolved to help them enroll. We're a broker and we get paid by the health insurance companies, but we're neutral on behalf of the consumer. So we are consumer centric company and our single mission is to make sure Americans have the best and right insurance for them.

So Scotts, as Lisa mentioned, your stock is up over two over the trailing twelve months. What's really been the driver there for behind the stocks? Now, that's great, Um, it's at the result of the explosive growth in Medicare private Medicare plans better known as Medicare advantage or Medicare

supplement plans. They're about sixty million eligible Americans for Medicare right now, and of those, about thirty six million have opted to buy private insurance plans, many of which millions and millions of which can get zero premium products through Medicare Advantage. And we've been growing because we are gaining share of that growing market. So it's got you basically are like an Expedia for health insurance plans, right it is that a fair way to sort of roughly characterized. No,

it's the perfect description. And just as Expedia carries all the airlines and has all of the flight of plans and prices as well as all hotels, we have all the plans and all the carriers, every doctor, every hospital, every pharmacy, and so we are able to help seniors get into the right Medicare plan. And that real consequence for seniors. It's a it's a stressful decision for them because you know, they use a lot of healthcare at their age, and what we do is we're that neutral

guide to get them into the right plan. And so we've been growing six seven times the growth of the industry because we're on the side of the consumer. Why would companies health insurance companies pay you if you are ultimately trying to make the premiums lower for the end consumer, right, Well,

they their challenges. They also try to enroll seniors in their own plans, and they do a good job of that, but they can only offer the best plan for the senior that is that their company offers, whereas we offer all of the company's plans. And so the reason that they use brokers, and broker's account for half of all enrollments in Medicare is because we reach into millions of seniors that they don't reach, and so they're willing to

pay us. It's an offset to cost they would have anyway, because it's expensive for the health insurance carriers to go out and find seniors and explain to them the benefits and get them enrolled, and so paying a broker is really an offset to a cost that the carrier would have anyway. So, Scott, what you know, as we approached the two presidential election, certainly a lot of Democratic candidates are talking about changes in healthcare laws and maybe even

Medicare for all. How how would that impact your business? Yeah, Medicare for all is a great sound bye, and you know, it's great for a political debate where you're limited to thirty seconds. You know, the challenge of it is what is your definition of Medicare for all. The reason that it's popular when it's not explained is because Medicare working

and seniors are happy with it. The twenty plus million Americans that are on a Medicare advantaged plan today, Our polling shows very high user satisfaction with Medicare advantage and it's been the Trump's administration's plan and objective to get more seniors on Medicare advantage plans because it's cheaper for the government, and colitical studies show it's better health care for seniors, and so seniors like it, and so of course it would be popular to say let's have Medicare

for all. The first thing I point out is seniors don't want Medicare for All. They feel like they've paid into this for their entire working lives and they do not want the system flooded by a hundred and fifty million non seniors. They know that would cause their benefits to be reduced. That's one big obstacle to Medicare for All and seniors vote, as we all know. The second obstacle is we have a hundred and fifty two hundred and sixty million Americans covered by employer sponsored healthcare and

they don't want to give that up. And so I believe the political reality of this as we get deeper into the cycle, it will become more clear. And you're already seeing many candidates like Kamala Harris backing off of Medicare for All, even though she had signed on to the original Bernie Sanders bill. As she's dug deeper into it, her view has evolved, and I think wisely so. Scott Flanders,

thank you so much for joining us. Scott is a chief executive officer of Healthy Trains on the NASTAC under the symbol h TH Companies based in Mountain View, California. We appreciate Scott coming on giving some thoughts about his company and the state of the US healthcare industry. It's

getting to be pretty predictable. When we do get some sort of softening and trade talks, the place to look at is the socks, the semiconductor index, which will inevitably pop vice versa if you have some sort of hardening and trade tensions. That's the one that falls out of BED. Joining us down to discuss what the outlook is for some of these se conductor shares, as well as tech in general. David Garretty, chief market strategist at laid Law and Company, also a partner at bt block. He's joining

us here in our Bloomberg Interactive Broker studios. So we are seeing today popping socks stocks. Micron is up two point six percent, for example, the Socks Index of Philadelphia Sock Exchange Semiconductor Index up two point one per cent. How much more could you see this index and these stocks rally if there was a protracted softening in trade

discussions between the US and China. Yeah, if we were to end up with the situation where we saw maybe a call for six month truce in terms of trade discussions, pushing things out into you know, it might be possible to see you know, if I do a ten percent

rally in these names. But bear in mind that a lot of what's been going on in terms of the equity markets to date have been predicated primarily upon the fact that the Federal Reserve was gonna be accommodative in terms of monetary policy against any economic softening that would occur as a result of these artificially induced trade wars

between the US and China. Uh So, certainly we might say that equities to begin with anyway, including the semiconductor shares, are probably trading at elevated levels, especially when you look at a backdrop where corporate profits already down ten percent year over year from the third quarter of two thousand eighteen. So you know, clearly it's not gonna be profits that are driving the stock market higher. It was either the

expectation of one or two things. Either one of them is going to be monetary policy easing, which we think we saw the Federal Reserve potentially back away a bit from at least against expectations is shown by the futures market, or you know, obviously we need to see a softening here with respected trade negotiations, and clearly, you know there's

some positive noises being made here. But the question really boils down to are you going to see enough maturity on the US side to say, Okay, we're going to back down and stop beating our chest. So and again, it seems that you kind of highlighted what it seems to be kind of the drivers of this market, the push and pull between trade uncertainty and the FEDS ability to perhaps you know, ameliorate some of the downside from

trade uncertainty. Assuming you know the market is pricing in three four, gosh, maybe five rate cuts over the next eighteen months, do you think that would be Do you think the FED will be successful in continuing to drive the economy for it even if there is this uncertainty

from trade. Well, I would say that trying to overcome the uncertainty not just from trade, but trying to overcome the uncertainty that's coming from the current administration is going to be something that the FEDS to be able to offset.

Me A lot of what has been coming out in terms of, if we can call it policy volatility for the administration clearly has made it very very difficult for anybody running a business to plan over you know, a two to a five year horizon for fear of the fact that you know, someone could turn right around in twenty four hours and say something completely opposite of what

had been said before. Difficult to plan in an uncertain environment, and unless the administration we're able to move to a stance where they could give consistent, stable policy views that people could actually plan around, most likely you're going to find that people who are going to be make committing capital not just to the stock market but to the real economy here are going to say, look, we'll just take a glow go slow approach until we've got somebody

more stable that we can deal with. Which tech company big tech do you think has most immunized itself from some of the push pull that we're seeing in the trade talks. I mean, the view around technology g is um Certainly if we look at the ongoing strength that there is around online search, Google still remains a fairly strong factor. Google on their own had pulled out from China.

Not granted, there have been issues where Google has been seen doing some development work, potentially in collaboration with China, but I would argue that on balance it's a fairly small part other overall business. Uh, you might also say that at the same time, Amazon, uh, you know, it certainly has some strength in terms of just being able to displace retail. Granted, this is all happening against a consumer environment where the impact of tariffs could have a

major effect on holiday shopping in two thousand nineteen. This is not necessarily something from which Amazon would be immune. But one would argue if you look at other participants in the retail channel, probably Amazon is still in a position to gain greater share against that. So one might argue that if you want to get away from semiconductors where clearly they're directly exposed relative to trade negotiations, Apple to some extent, also the impact that it's had on

the iPhone in the overseas markets. But looking in terms of some of the tech names, Google, Amazon would be some major names that we would look at as being somewhat insulated, you know, staying with tech stocks. One of the risks that seems so faded a little bit is the regulator the regulation risk for a tech I mean, you know, it seems like it's been a you know, a lifetime ago when we had to tech CEOs in front of Congress and so on and so forth. How much of a risk do you think that is an

overhang for technology stocks. I'm looking at just the NASDACS down two percent from on a trailing twelve month basis. How much of regulatory risk is still out there for the tech sector. I would say the regulatory risk continues to be a concern. I mean, we obviously have a situation situation right now where Congress is adjourned, but obviously wait until September and hearings are reconvened. Also in the meanwhile, it's been interesting to see that tech companies such as

Facebook in the area of digital currencies. Facebook, as we know, would come out back in June two thousand nineteen discussed their effort at developing a digital currency libra um. There was universal pushback from regulators in this regard, but their indications now that Facebook is still planning on pushing forward

to have an early launch. So you know, the fact that a company like Facebook would essentially act against regulators in this case not work collaboratively with them, I would think just argues for further attention to be paid to this area. So further attention just to follow up on the libra Have we determined that it actually is a

cryptocurrency at this point. Uh, it probably is whatever Mark Zuckerberg says it is um, but we would argue that I would But in terms of companies developing digital currencies, I'd much rather look at what JP Morgan is doing with the jpm coin and the fact of seeing that actually developed and deployed, uh, than than putting any great expectations on my part with respect to what Facebook and Libra may do. So touch about that jpm coin, what

is that? Essentially? It was announced back in February of two thousand nineteen. The initial intention was this was a way of trying to put in place a blockchain platform UM with a settlement token, the jpm coin that would be used to speed transfers reduced costs of being able to move money. First, it was targeted mostly in terms of other inter bank transactions, but over time as it started to expand, it has the potential of going out to more enterprise or corporate clients, not just of JP

Morgan Chase, but also it's network of correspondent banks worldwide. Interesting. David Garretty, thanks so much for joining us. David's a chief market strategist at lay Lad Company, also a partner at bt Block, joining us as he's wanted to do in our Bloomberg Interactive Broker studio. We appreciate your thoughts

on the market and on technology and on cryptocurrencies. Well, last night, China indicated that it would not immediately retaliate against the latest U s tariff increases announced by President Trump last week, emphasizing the need to discuss ways to de escalate the trade war between the world's two largest economies. To get the latest on the US China trade discussions, we go to Christopher Balding, Associate professor at Fulbright University

in Vietnam. He's also a Bloomberg opinion columnist. Usually he's based in Saigon, but today he is in Los Angeles, California. Christopher, thank you so much for joining us. So what do you make of the move by China last night to say, hey, let's maybe de escalate this a little bit. I wouldn't read too much into it. At the same time, yesterday, for instance, they were criticizing the US for freedom of

navigation patrols in the South China See. They were also calling for uh um an ending of the embargo against Huawei. Excuse me, um so I I'd be a little cautious reading too much into that one particular statement. So I want to read you something that Jim Bianco of Bianco Research said in an interview with the Market n z

Z it's a German UH newspaper. He was talking about President Trump's tactics UH in the trade war, and he referred Spinal Tap, the sort of cult film from the nine eighties, saying, I think Trump is going to eleven on trade. He's going to turn it up so high that there is going to have to be a deal. That's the way he wants to do this. He will just make it intolerable so everybody has to sit down

and cut a deal. Do you agree. I think there's some truth to that with with with a caveat, And what I mean by that is is if you if you actually go back and look over the past eighteen months, UM, there has been some back and forth, and there have been some stops and starts, but in reality, the trendline has been slow and steady escalation for the past eighteen months, which is where we're at today. UM. So if we

stripped the rhetoric out, UM, it's actually been pretty pretty steady. UM. However, I think what's always important to remember is that UM, domestically, China has a lot more control over its economy, especially with the credit flows UM and how they're working to

keep the economy going UM. So I think their their threshold for pain is quite high, and so they seem intent on essentially making Trump uh bring the pain for lack of a better term, and so I think it's going to be very interesting to see who blinks first in how much pain each side is willing to sustain. So on that front, UM, you know, it appears that, you know, President Trump and the administration are prepared to take the long road here. There's really hasn't been any

indication that they are not. So is your expectation that these these trade discussions or impasse, if you will, uh, we kind of go beyond the election. I'm kind of I'm kind of looking at is the real the election? Is the real indicator about what's going to happen, because it's very you know, even though China might release an overnight statement, I don't think there's a whole lot of evidence that there's going to be any type of significant

movement uh any any time soon. And so I think you really have to expect that Beijing is really hoping for uh, for a much more compliant president, It is willing to make a deal than President Trump. So I guess I'm looking right now at market reaction, which is that people buy it, I mean right now. And I was thinking, perhaps you're seeing a rally on this sort

of de escalation or a parental de escalation by China. Uh, perhaps it's on light volume, but no, we learned it's actually on more value volume in terms of stock trading than we've seen in recent weeks. And I'm just wondering, do you think that traders are wrong, that they just keep getting fooled again and again that there's some sort of progress when it is just sort of a steady escalation and that's what it's going to be until UM, I do think it's going to be a much more

steady escalation. And UM it is a little surprising to me that every time there is this, you know, um overnight negative comment or a Trump tweet, that the market jumps in reaction. And it would seem by now that the algorithms could figure out that to essentially moderate their expectation of a specific statement or tweet so Chris, I know you have a lot of expense experience in the UH in the Asian region gives your sense of kind of the pressure that President g is under to get

not only a deal but the right deal. Well. I think the big issue for him economically is if he were to actually make significant material concessions on economic policy. UM. There's two specific issues. First of all, he's built himself up as the rejuvenator of China, you know, making China great again, and so that would be politically suicidal for

him to to really back down to Trump. The other thing is is that if he was to really open up Chinese markets to competition and reduce subsidies to heavy industry and things like that, UM, there are very serious questions about the stability that that would bring or or the volatility that would bring to unemployment UH, to a lot of industries, UM, potential bank failures, things like that.

So it's questionable even economically if he can do that without being willing to bear a significant amount of pain in the Chinese economy. There was a story today on the Bloomberg looking at how most US companies are planning to stay in China and simply ride out any unrest

with respect to trade negotiations. And you have seen certain banks expand their operations overseas, and I'm wondering, you know, whether they're right in in betting that China won't retaliate against them as part of their effort against the US when they run out of goods to tariff. Well, I think it is a very serious question. And we've seen this with the Canadians, We've seen this with Brits um,

we've seen this with Australians. That China has no qualms about using either business operations or foreign personnel as bargaining chips. And this is dating back many years. This is not just trade war related. Um, So I think it's I think it's a significant risk that those companies are absorbing deciding to stay in there and say China is not going to retaliate against US because they clearly have a

long term pattern of doing so. So, Chris, there seems to be bipartisan support in the US for a meaningful trade deal with China. Is the same thing true in China. Well, the rumors that you hear, and I think there's there's solid evidence to back this up, is that there's a lot of in there's a not insignificant amount of infighting within China about what is how is best to proceed um. It's not lost on even you know, let's say Party supporters that China is becoming increasingly closed off from the

global economy UM. Whether it's being able to vacation abroad as they put currency limits on people, UM, or whether it's invest abroad, all access to information overseas. It's not lost on anyone, even the Party supporters what is happening. So I think there is a not insignificant amount of infighting even within China. Christopher Balding, thank you so much for spending time with us. Christopher Balding is Associate professor at Fulbright University of Vietnam. He is also a Bloomberg

Opinion Calmness. Thanks for listening to the Bloomberg P and L podcast. You can subscribe and listen to interviews at Apple Podcasts or whatever podcast platform you prefer. I'm Paul Sweeney, I'm on Twitter at pt Sweeney. I'm Lisa abram Woyds. I'm on Twitter at Lisa A. Bramloits one before the podcast, you can always catch us worldwide. I'm Bloomberg radio