QSR 50 | August 2012 | By Sonya Chudgar

Wingstop Takes Flight

Armed with the marketing, infrastructure, and know-how, Wingstop is poised to be the quick-service brand that finally takes wings national.

Andy Howard and Jim Flynn have helped Wingstop to fast growth nationally.
Andy Howard, left, and Jim Flynn have helped Wingstop to fast growth nationally. Wingstop
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Wingstop’s executive chairman of the board, Jim Flynn, isn’t shy about comparing his brand to McDonald’s.

“I want to say we’re going to be the McDonald’s of the wing industry, and basically, we are at this point,” he says. “Because there’s nobody else this big.”

“They’re one of the best-kept secrets in [quick service],” says Gary Stibel, who has consulted for companies from McDonald’s to Yum! and is now CEO of the New England Consulting Group. “In new markets, they can define the way the game is played.”

Indeed, Wingstop is playing a new game. Wings aren’t yet widespread in the quick-serve industry, making Wingstop the first serious player in taking this saucy dish national.

While brands such as Pizza Hut, Pizza Patrón, and KFC do season and toss wings for customers, none of them specialize in it. The closest competitor to Wingstop, in terms of number of locations, is Wing Zone, which tops out at 100 stores. Wingstop, on the other hand, has 515 units dedicated solely to cooked-to-order chicken wings.

The growth strategy is straightforward: From operations to expansion to R&D, Wingstop focuses on multiple facets of the business rather than zeroing in on one.

“We have a lot of singles and doubles, as opposed to waiting for one big idea,” says Andy Howard, Wingstop’s chief marketing officer. “It’s probably 10 initiatives.”

A rundown of undertakings in 2011 includes the debut of the 10th wing flavor, Louisiana Rub; introduction of an iPhone and Android application that increased online ordering by 5 percent; advertisements for national, regional, and local television stations; the company’s first Facebook campaign; a new mystery shopper company that anonymously inspects stores and delivers feedback; and advancement of a sophisticated real estate model, “because it’s still, in this business, [all about] location, location, location,” Howard says.

With more business initiatives than comebacks led by NFL quarterback Tim Tebow, Wingstop expects 2012 to be the ninth year of same-store-sales increases.

The sales streak was initiated and solidified by Flynn, who joined the company in 2003 as president and CEO. Under his wing, the brand grew from 88 locations to 515. In June, Flynn stepped into his current role as executive chairman of the board and Charles Morrison was named president and CEO.

“They have a truly outstanding value proposition,” Stibel says. “They have already differentiated themselves with their product; their product is very good. Their price point is very attractive. They’ve got an outstanding franchising program, which is one of the reasons they’re growing so fast. Their comps are great.”

Competition for Wingstop does not come from other players in the wing sector or even from sports bars, which are traditionally associated with wings.

“The thing is, if you look at our alcohol sales, it’s 2 percent,” Flynn says. “We don’t consider Buffalo Wild Wings a real competitor of ours, because 80 percent of our product is take-home and 20 percent is eat-in.”

Instead, Stibel says, competition for Wingstop arises from other quick-serve joints with the word wing in their names.

“There are an awful lot of people who will say, ‘I’ve been there, and it’s OK,’ but they haven’t even been to a Wingstop,” Stibel says. “Because it sounds so much like Wingstreet and so many other names out there, it’s easy to confuse them.”

He says Wingstop’s focus moving forward should be brand building and marketing so the company can distinguish itself from the wing pack.

In fact, 10 years ago, marketing was foremost on executives’ minds. Howard had the idea to get one of Wingstop’s customers to publicly express his love of the brand, a common advertising technique known as customer testimonial. So it was that Jordan Bazant, the New York–based agent for former Dallas Cowboys quarterback Troy Aikman, received a phone call from Howard in 2003: “This is Andy Howard from Wingstop. I want to talk to Troy about becoming our national spokesman.”

Bazant related the message to Aikman in vague form.

“He tells Troy, ‘Hey, I have this Wing Shack or Wing Joint’—I guess we didn’t have any presence in New York,” Howard says with a laugh. “He tells Troy, ‘They want you to become their national spokesman.’ And Troy says, ‘Well, is it Wingstop?’”

Aikman had apparently been a fan of the brand for years, a regular at his local Texas store who visited once a week. With the company’s identity confirmed, Aikman accepted Howard’s proposal immediately. In 2011, he also joined Wingstop’s board of directors.

After nine years of Aikman as the symbol of the brand, “You wonder, has it run its course?” Howard says. “But as we keep saying, if he keeps helping us sell wings, then he’s going to keep being our spokesman. And he’s actually continuing to do that year after year, so it’s been terrific.”

Wingstop utilized the fourth quarter of 2011 to market through a new avenue: interactive, online advertising. Android and iPhone users got a taste of the Wingstop app, and the brand simultaneously leveraged its first Facebook campaign. The focus of Q1 this year was Twitter.

“We had a national Twitter campaign that launched with March Madness,” explains Jason McEachern, vice president of technology at Wingstop. “We’re doing Foursquare, we’re starting to get into Yelp and some additional channels, but the majority of it is going to be Web-based Facebook and Twitter.”

The Twitter campaign increased followers by 200 percent and online traffic by 300 percent.

Roark Capital Group purchased Wingstop in 2010, and the result was a greater emphasis on franchise development. Flynn says it has paid off; four months into 2012, Wingstop had sold 75 new development agreements, more than half of the year’s goal of 130.

“We’re going to substantially outdo that for the year,” Flynn says.

Sales, meanwhile, show little sign of slowing down.

In February, as the New York Giants beat the New England Patriots in Super Bowl XLVI, Wingstop was quietly accomplishing a record off the field: 5.6 million wings had been sauced, tossed, and carted out the door that day, a 12 percent boost over Super Sunday in 2011.

“We are just jammed throughout that day,” Howard says. “We fill up every time slot from opening to, literally, the close of the day.”

The brand proved it is unafraid to test itself when it broke ground on a fast-casual sports prototype in Texas in March, though Flynn is quick to assure “we’re not going the route of Buffalo Wild Wings or a sports bar.” The concept features a menu with grilled food, added seating, and more televisions.

“It was obvious when we first took over the company that sports have a big thing at home and people like to sit down and eat wings,” Flynn says. “It really does have a positive impact on sales.”

With its attractive value proposition, Stibel says he is confident Wingstop will do more than just break into the QSR 50 in the coming years.

“I think they’ll break your top 40,” he says. “These guys are growing so fast, that they’re likely to be in your top 40 pretty quickly.”