"I knew right away that I had to be aggressive," Lovell says. "You don't get $40 million of free press [the cost of the movie] and not use it."
How to expand presented a problem. Unlike most chains, Coyote Ugly was not famous for its decor or signature dishes but for its attitude (the name refers to a man so homely that a one-night-stand partner would rather chew off an arm to escape his bed--like a trapped coyote--than wake him). "This is about being a strong woman," Lovell says. "You're expected to get on the bar and entertain and serve people, do a show and still make money at the same time." It was a tough hurdle to clear: Half of the first 400 New York coyotes quit or were fired their first night. Piccirillo recalls a new bartender on duty one quiet evening. When five Wall Streeters stood to leave, Lovell warned the coyote, "If they go through that door, you're fired." The bartender ran back, bought the five a round, and danced on the bar. "They stayed for four hours," says Piccirillo. "You don't have to accept a bad night."
Gilbert says that her fear of getting on Lovell's bad side meant that on slow nights she would run out onto the street to round up patrons and, if that didn't work, put $10 or $20 into the till. "You would steal from yourself," she says.
Lovell's Coyote Ugly is more than a tavern version of Chained Heat, however. At the same time they sass men, the coyotes must make women comfortable enough to come in and get on the bar. "Women customers mean more men customers mean more money," says Lovell. And Lovell has specific ideas about music (southern rock), drinks (beer, yes; martinis, no), bartender gender (female), and sales tactics. Coyotes mock patrons into buying shots for them, pour liquor directly into patrons' mouths (a "penalty shot" for naughtiness), serve shots in their navels (a "body shot")--and charge for every drop.
"It's a powerful experience to have a woman half your size pull on your hair, tilt your head back, and pour tequila up to your teeth," says Ben Choi, a New York bar patron. It's lucrative too: "Body shots cost $20. We give the girl $5, and we get $15 for what costs us 50¢," says licensee John Cestare.
After the movie release tourists packed the New York bar demanding a re-creation of the Hollywood experience. "There was a backlash," says Squatriglia. "The regulars got angry when the movie first came out, it was so jammed in here. You couldn't blame them." But there was a financial opportunity in creating bars somewhere between the original 1,500-square-foot dive and the sanitized Hollywood version. So Lovell decided to create larger, nicer variations, with dances choreographed to some of the songs in the movie--ironically, codifying one of the original bar's most spontaneous practices.
Without capital to expand alone, Lovell could either franchise her bar or license the trademark. While franchising would give Lovell control down to decor and drink sizes--à la McDonald's--it involved expensive and time-eating legal filings. So she chose licensing, which let her anoint licensees but did not allow her to dictate operating procedures. Lovell wasn't worried. "At first, Liliana said, 'I don't want that much control. If they're coming to me they know what the concept is. They've seen the movie," says Jeff Wiseman, Ugly Inc.'s general counsel and a onetime Lovell regular at the Village Idiot.
Lovell chose a standard licensing scheme--licensees pay $50,000 up front, plus 5% of gross sales and a quarter of merchandise sales. Jennifer Worthington, an associate producer on the movie, bought the rights for Las Vegas, which opened in October 2001 (in the New York, New York casino, the Vegas bar is the highest earner--$14 million a year; Atlanta, at $1.5 million, is the lowest). Around the same time, Cestare, a 31-year-old club promoter, dropped by the Manhattan bar to see if he could cut a deal. He offered between $2 million and $3 million for U.S. rights (Lovell laughed at him), eventually settling for four cities--Chicago, Atlanta, Boston, and San Diego. Lovell herself renovated a bar of her own at a cost of $1.4 million in New Orleans, where she lives with Piccirillo, a screenwriter, and their four-year-old son.
The lack of franchise regulations made vetting licensees that much more important. After deciding which cities had the right demographics (more than a million people in the area, a young population), Lovell had potential licensees sign a nondisclosure agreement and visit her in New Orleans for a personality check of sorts.
Mike Hudson, a partner in the Dallas bar, describes his visit: "I thought, 'I'm a potential licensee, I'm a VIP, I'm drinking for free tonight.' But at the end of the night Chantal [a coyote] said, 'Buy me a shot.' All I had was $5. She snatched it out of my hand and did a shot and said, 'Thanks, have a nice night.' I said, 'I can't believe you took my cab fare.' She eventually gave it back."
Once they've inked the contract--which grants exclusivity within a 75-mile radius and allows Lovell access to bar records--they prepare to open. First, they choose a location with Lee Killingsworth, Ugly Inc.'s director of business development, who scours heavily trafficked locations for high-ceilinged spaces between 2,500 and 8,000 square feet. Once one is picked, Lovell offers decorating advice and a line of merchandise.
Then the brand work starts. "The hardest part about licensing is making sure they don't stray off course," says Killingsworth, who assembled a 200-page manual of procedures for everything from hiring coyotes to which celebrity birthdays should be celebrated (think Kid Rock and the late Johnny Cash).
