Why Cracker Barrel Can't Duck Controversy Now

Cracker Barrel Can't Duck Controversy Now
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Cracker Barrel Old Country Store's front porch chairs aren't the only things rocking these days. The restaurant chain specializing in Southern comfort food with attached gift shops stocking throwback country trinkets has courted controversy with a pair of moves that has set off a testy debate.

Cracker Barrel (CBRL) became the first retailer to pull some "Duck Dynasty" merchandise over the weekend after the A&E reality show's Phil Robertson offended many readers by voicing comments that were insensitive to the gay and African American communities in a GQ magazine article.

There was naturally a fair amount of viral applause after the restaurant's swift move, but then came the voices from those that either agreed with Robertson's remarks or felt that his freedom of speech was being challenged. They took to Twitter (TWTR), Facebook (FB) and email campaigns to complain, threatening to boycott Cracker Barrel if the merchandise wasn't returned to the shelves.

A day later, Cracker Barrel complied.

Duck Sauce

"When we made the decision to remove and evaluate certain Duck Dynasty items, we offended many of our loyal customers," Cracker Barrel explained in a letter to customers Sunday. "Our intent was to avoid offending, but that's just what we've done."

"You told us we made a mistake. And, you weren't shy about it. You wrote, you called and you took to social media to express your thoughts and feelings. You flat out told us we were wrong. We listened. Today, we are putting all our Duck Dynasty products back in our stores."

The note may seem overly apologetic, and outright offensive to those that were initially upset by Robertson's incendiary comments.
Then again, Cracker Barrel's strong presence in the South made it an unlikely trailblazer by pulling the products of one of the more popular reality shows on television. There are 7.3 million fans of the show on Facebook, and these are just the social media-savvy fans that happen to be on the leading social networking site. There are 1.7 million followers of the show's official Twitter feed.

Duck Duck Goose

Cracker Barrel's reversal took all of 24 hours, but naturally it's going to look bad from both sides. It initially angered the fans of the show, but then it offended those who were angered by the comments.

It's a strange series of events. Often the loudest cries for boycotts come against those making comments that are perceived to be insensitive. Just ask Paula Deen or Chick-fil-A's Dan Cathy. This is a rare instance where the backlash to the backlash was what won a company over.

Then again, Cracker Barrel is no stranger to controversy.

Two decades ago, the chain came under fire for dismissing several employees -- according to what was reportedly an internal memo -- who weren't displaying "normal heterosexual values" at work. Several years later, some minority employees filed a discrimination lawsuit. That was followed in 2001 with some minority customers claiming that the restaurant was segregating patrons by race. Then there were sexual harassment claims at three of its eateries. Cracker Barrel paid to settle the claims.

Fowl Play

Cracker Barrel has publicly changed its policies so that they are more in tune with the times. It's also clear that the chain is more popular now than ever. The chain has grown to 625 locations, and its stock hit an all-time high late last month.

Many casual dining chains are struggling, but not Cracker Barrel. It has rattled off eight consecutive quarters of positive same-restaurant sales growth.

We'll see if this fresh wave of controversy nips that impressive streak or if it triggers a spike in loyalty. The chairs are rocking back and forth on the front porch, but things are heating up in the Cracker Barrel kitchen.

Motley Fool contributor Rick Munarriz owns shares of Cracker Barrel Old Country Store. The Motley Fool has no position in any of the stocks mentioned.

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