Reading Emil Brolick’s plan to revitalize Wendy’s, I kept getting my chains confused. The strategy has been code-named Recipe to Win, which sounds conspicuously to me like McDonald’s Plan to Win.
Ditto for Recipe to Win’s Six P’s component, which calls for an intense focus on people, product, price, promotion, place and performance. It’s just one P more than McDonald’s five P’s, a cornerstone of the Plan to Win (performance is the only P missing from McD’s pod.)
I’m a big fan of Brolick’s and the work he did for Yum! Brands and, in an earlier stint, Wendy’s. But it sounds as if he’s liberally borrowing at least the rubric from the Golden Arches playbook. Granted, Big Mac’s battle plan has been inarguably the most successful restaurant-company strategy of the last decade. Still, you have to wonder if the ultimate mass feeder and a much smaller brand, claiming product superiority, can truly share the same scheme for besting the other.
It wasn’t a surprise, given the attention Wendy’s is devoting to McDonald’s, that Brolick’s charge will all but challenge the bigger burgermeister in ads that air this month. Commercials will focus on Wendy’s premium sandwiches in what Brolick likened to the “Apple vs. PC” commercials the former aired to great success.
“The spot is much more directly competitive against the Big Mac. Now it never mentioned the Big Mac by name, but it's pretty obvious of what we're talking about,” he said.
Among the other tidbits that were revealed during Wendy’s conference call with financial analysts (as reported in a SeekingAlpha.com transcript):
--Each Wendy’s remodel will cost $750,000 to $850,000, with a forecast 15% return on investment, Brolick said. He noted that 10 test sites were given a facelift last year, and 50 will be updated in 2012.
--What may be the industry’s longest-ever menu test, Wendy’s trial run of breakfast, will be expanded to a Northeastern market this year for more learning, Brolick said. He didn’t reveal the market, but noted that the Northeast is one of the nation’s most intense battlegrounds for morning customers.
Showing posts with label Emil Brolick. Show all posts
Showing posts with label Emil Brolick. Show all posts
Thursday, March 1, 2012
Monday, November 21, 2011
Myth busting
A confused figment of my imagination writes, “Hey, Restaurant Reality Check, how am I supposed to tell fact from fiction in the age of The Onion, the Borowitz Report and KFC’s publicity department? Some of their made-up restaurant stories sound more believable than the real thing. How can a non-cynic know when he’s being fed a whopper?” (signed, Believing It—Or Not?)
Dear Believing,
I was discussing the very thing yesterday with Henry Kissinger and the Fonz. You just can’t tell these days who’s pulling your leg and who’s merely covering the Republican presidential candidates.
Fortunately for you and your confused peers, Restaurant Reality Check can recount how a few persistent myths were disproved, decidedly, by recent industry developments.
Wall Street firms have a hammerlock on executive compensation outrages. A Friendly source—note the capital “F”—blew that one away. In case you missed reports in mainstream media like The Wall Street Journal and The Huffington Post, the restaurant industry has its own instance of a CEO enjoying big-dollar privileges while the corporate rank-and-file burn their pink slips for warmth.
According to the reports, Friendly’s CEO Harsha Agadi billed the company for $234,000 in day-to-day expenses in the year preceding the restaurant franchisor’s recent bankruptcy filing. The charges didn’t include the $190,000 Agadi submitted for relocation.
The contrast with the plight of Friendly’s workers is what made the story a hot one. More than 600 lost their jobs when some 60 stores closed.
We can also refute at this time that the Fribble lobby has secured a federal bailout for the family chain.
E-mail is killing letter writing. Not in the restaurant business. Hundreds of stationers could pop for a second home this year because of the business they’re reaping from disgruntled shareholders and the chains they’ve targeted for takeover.
This morning, for instance, Cracker Barrel shareholders were sent a letter from CEO Sandy Cochran, spelling out why they should rebuff Sardar Biglari in his attempts to wrest control of the family chain from current management. She countered Biglari’s assertions by explaining the chain’s business-building strategies, point by point.
The communication was in response to an 11-page letter that Biglari sent last week to the same recipients. Taken together, the two missives might have made Cracker Barrel’s shareholders the most informed in the business.
But that’s not the only volley of letters helping the Postal Service. Cosi and Brad Blum, the Olive Garden alumnus who wants to run the fast-casual chain, have stamp dispensers churning as well.
Ditto for the CEO-turned-advisor of Wendy’s, Roland Smith. Recent SEC filings include Smith’s resignation letter, which in turn referenced other missives during the summer. The communications indicate that Smith stepped down because he didn’t want to leave Atlanta, where the chain is currently headquartered. It’s moving back to the suburb of Columbus, Ohio, where it was founded.
Smith has been succeeded as CEO by Emil Brolick, who’s collecting $1.1 million in salary, with the opportunity to earn another $1.6 as a bonus. Smith was in the same ballpark.
Survival has supplanted concept development. According to the conventional wisdom, restaurant companies are too preoccupied with survival to consider the development of new concepts.
Not any more.
The last two weeks brought announcements of new concepts from such celebrated operators as Starbucks (Evolution Fresh Juices), P.F. Chang’s (Pei Wei Asian Market, which of course has nothing to do with Chipotle’s launch of ShopHouse Southeast Asian Market), IHOP (IHOP Express) and Jamba Juice (JambaGo, the juice chain’s riff on an express format).
Okay, enough myth busting for now. In our next installment, we’ll take on Yeti and the promises of restaurant unions.
Dear Believing,
I was discussing the very thing yesterday with Henry Kissinger and the Fonz. You just can’t tell these days who’s pulling your leg and who’s merely covering the Republican presidential candidates.
Fortunately for you and your confused peers, Restaurant Reality Check can recount how a few persistent myths were disproved, decidedly, by recent industry developments.
Wall Street firms have a hammerlock on executive compensation outrages. A Friendly source—note the capital “F”—blew that one away. In case you missed reports in mainstream media like The Wall Street Journal and The Huffington Post, the restaurant industry has its own instance of a CEO enjoying big-dollar privileges while the corporate rank-and-file burn their pink slips for warmth.
According to the reports, Friendly’s CEO Harsha Agadi billed the company for $234,000 in day-to-day expenses in the year preceding the restaurant franchisor’s recent bankruptcy filing. The charges didn’t include the $190,000 Agadi submitted for relocation.
The contrast with the plight of Friendly’s workers is what made the story a hot one. More than 600 lost their jobs when some 60 stores closed.
We can also refute at this time that the Fribble lobby has secured a federal bailout for the family chain.
E-mail is killing letter writing. Not in the restaurant business. Hundreds of stationers could pop for a second home this year because of the business they’re reaping from disgruntled shareholders and the chains they’ve targeted for takeover.
This morning, for instance, Cracker Barrel shareholders were sent a letter from CEO Sandy Cochran, spelling out why they should rebuff Sardar Biglari in his attempts to wrest control of the family chain from current management. She countered Biglari’s assertions by explaining the chain’s business-building strategies, point by point.
The communication was in response to an 11-page letter that Biglari sent last week to the same recipients. Taken together, the two missives might have made Cracker Barrel’s shareholders the most informed in the business.
But that’s not the only volley of letters helping the Postal Service. Cosi and Brad Blum, the Olive Garden alumnus who wants to run the fast-casual chain, have stamp dispensers churning as well.
Ditto for the CEO-turned-advisor of Wendy’s, Roland Smith. Recent SEC filings include Smith’s resignation letter, which in turn referenced other missives during the summer. The communications indicate that Smith stepped down because he didn’t want to leave Atlanta, where the chain is currently headquartered. It’s moving back to the suburb of Columbus, Ohio, where it was founded.
Smith has been succeeded as CEO by Emil Brolick, who’s collecting $1.1 million in salary, with the opportunity to earn another $1.6 as a bonus. Smith was in the same ballpark.
Survival has supplanted concept development. According to the conventional wisdom, restaurant companies are too preoccupied with survival to consider the development of new concepts.
Not any more.
The last two weeks brought announcements of new concepts from such celebrated operators as Starbucks (Evolution Fresh Juices), P.F. Chang’s (Pei Wei Asian Market, which of course has nothing to do with Chipotle’s launch of ShopHouse Southeast Asian Market), IHOP (IHOP Express) and Jamba Juice (JambaGo, the juice chain’s riff on an express format).
Okay, enough myth busting for now. In our next installment, we’ll take on Yeti and the promises of restaurant unions.
Thursday, November 10, 2011
Enter the mid-tier burger
Faster than you can say “Forget 99 cents!,” two big fast-food chains are unwrapping burgers that could lure customers away from the low-priced choices that eased the brands through the Great Recession.
Call them mid-tier burgers, priced to fill the gap between each chain’s new premium choice and the smallest sandwiches on their respective menus.
Indeed, “mid-tier product” is the description Wendy’s uses for its W burger, which will be rolled out in December. “This is going out at a $2.99 price point,” new CEO Emil Brolick explained to investors yesterday. “One of the things we want to do is put a product out there that we think is going to encourage people to trade up. Perhaps those individuals that are purchasing [a] 99-cent item will trade up to this product.”
The lure, he said, is a strong flavor and a high-craft aspect to the burger, which has about “two, 2.5 ounces” of fresh beef.
That seems to be the same strategy Burger King is employing with its new BK Toppers line. The burgers are dressed with flavorings like Swiss cheese, mushrooms and barbecue sauce. They’re heftier than the W’s, with 3.2 ounces of beef, but will be priced at $1.99, according to franchisee Carrols Restaurant Group.
That puts it between BK’s regular and Mini burgers on the low-price end, and the new BK Chef’s Choice at the high end, with a price of $4.99.
The two giants aren’t alone in sandwiching mid-priced burgers between their bargains and their biggies. Carl’s Jr. recently added new Steakhouse burgers, arrayed on the menu between its Six Dollar Burger line (typically priced around $4) and its Famous Star singles.
Missing among the converts is the segment’s true king, McDonald’s. First in size as well as sales growth, it’s been relying with stunning success on its beverages and snack-type items, leaving its burger line-up largely untouched since the rollout of the Angus line.
Call them mid-tier burgers, priced to fill the gap between each chain’s new premium choice and the smallest sandwiches on their respective menus.
Indeed, “mid-tier product” is the description Wendy’s uses for its W burger, which will be rolled out in December. “This is going out at a $2.99 price point,” new CEO Emil Brolick explained to investors yesterday. “One of the things we want to do is put a product out there that we think is going to encourage people to trade up. Perhaps those individuals that are purchasing [a] 99-cent item will trade up to this product.”
The lure, he said, is a strong flavor and a high-craft aspect to the burger, which has about “two, 2.5 ounces” of fresh beef.
That seems to be the same strategy Burger King is employing with its new BK Toppers line. The burgers are dressed with flavorings like Swiss cheese, mushrooms and barbecue sauce. They’re heftier than the W’s, with 3.2 ounces of beef, but will be priced at $1.99, according to franchisee Carrols Restaurant Group.
That puts it between BK’s regular and Mini burgers on the low-price end, and the new BK Chef’s Choice at the high end, with a price of $4.99.
The two giants aren’t alone in sandwiching mid-priced burgers between their bargains and their biggies. Carl’s Jr. recently added new Steakhouse burgers, arrayed on the menu between its Six Dollar Burger line (typically priced around $4) and its Famous Star singles.
Missing among the converts is the segment’s true king, McDonald’s. First in size as well as sales growth, it’s been relying with stunning success on its beverages and snack-type items, leaving its burger line-up largely untouched since the rollout of the Angus line.
Labels:
Burger King,
Carl's Jr.,
Emil Brolick,
menu additions,
menu pricing,
menu trends,
pricing,
Wendy's
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