The fast food game is now all about innovation. Instead of offering a stable menu that’s always the same no matter where you eat it — a McDonald’s model (MCD) – Get McDonald’s Corporation report made famous – fast food chains now have to endlessly spin up new limited time offers (LTOs) to keep people excited.
Yes, some people just want a Big Mac and fries, but in a hyper-competitive market, chains usually need something to draw a crowd beyond their regulars. This is one area where Yum! Brands (YUM) – Get yum! Report Brands Inc. the Taco Bell and KFC chains were the market leaders. These fast food restaurants gave us two different variations for fried chicken substitutes for a bun/taco.
McDonald’s and other burger chains have certainly used LTOs, but they choose their places more than Taco Bell and KFC. The creator of the Big Mac actually delved into its “secret menu” by putting some customer-favorite hacks on the actual menu. And, McDonald’s also had its celebrity meals (hello BTS Army) which either consist entirely of existing menu items or mostly with a new sauce or something minor added.
Wendy’s (MAGNIFYING GLASS) – Get the Wendy’s Company (The) report falls somewhere in the middle when it comes to innovation. The chain added new permanent menu items like its Baconator and Breakfast Baconator. He also tried some LTOs like his Hot Honey Chicken Cookie. Now the chain has a new limited-time offer that’s proving wildly popular, but it’s being sold at the expense of another beloved favorite that’s being pulled from the menu.
Wendy’s gives and takes away a Frosty
Wendy’s first introduced the Frosty – a type of thick shake or thin ice cream – in 1969. It came in only one flavor, chocolate, until 2006. Adding another flavor meant adding a second Frosty machine because each can only make one flavor. at a time and requires deep cleaning before you can craft another one.
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Now Wendy’s has added a Strawberry Frosty for the summer, but selling out means the Vanilla Frosty has to be taken off the menu. And while Wendy’s has been teased over the years for the intermediate consistency of its frozen treat, the chain was quick to poke fun at McDonald’s famously broken McFlurry machines.
“We are always listening to our fans and as our most requested item, it was a no-brainer for us to bring the Strawberry Frosty to the menu this season,” Chief Marketing Officer Carl Loredo said in a statement. hurry. “While some of our competitors are still trying to get their ice cream makers up and running, fans can dive into this new strawberry treat all summer long at Wendy’s.”
The problem is that while Strawberry will certainly attract new customers, vanilla-loving fans will be left behind.
Wendy’s delivered strong results
Wendy’s oscillates between pushing value and pushing quality, as it offers $4 and $5 meal deals while advertising fresh, never-frozen beef. CEO Todd Penegor spoke about both menu value and innovation during the chain’s first quarter earnings call.
“[We] keep working to make sure we have a 4 for $4 offer, redeem people in the Biggie Bag at $5 which is compelling value, do the things we need to do on the innovation front to continue to keep our menu fresh and top of mind for consumers to come and even drive things like the Buck Cookies trial promotion that was on the market to start the year to make sure we can keep getting action our customers, bringing them in, making sure that we’re not just focused on increasing dollar sales, but also increasing traffic,” he said.
It has been a successful model, according to the CEO.
“And what we’re really happy about in Q1 with all that context is that we gained dollar share again in Q1. So we’re now 11 straight quarters of either holding or gaining dollar share.” , he added.