Industry News | November 2, 2017 | By Alex Dixon | QSR Exclusive Brief

Bojangles’ to Test Delivery, Ramp Up Value Focus

Bojangles’ will launch its limited delivery service test later this year or early next year at 10 restaurants. Bojangles’
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As it faces a challenging and competitive environment built on value promotions and changing consumer preferences, Bojangles’ plans to alter its strategy.

The four-decade-old brand experienced a 2.2 percent same-store sales drop and a 0.2 percent decline in revenue during its third quarter, and it plans to bounce back through accentuating value and testing delivery.

“Consumer spending remains soft, and it appears those with lower household incomes have been impacted more than others. The competition from convenience and grocery store is still a concern for many,” president and CEO Clifton Rutledge said during a conference call Wednesday. “Consumers are staying at home more and using delivery. And of course, aggressive deep discounting from larger national brands with significant greater marketing budgets continues to attract consumers away from small, regional players.”

To combat its competitors’ discounting, Bojangles’ has pivoted toward discounting of its own. These efforts included a Welcome Home campaign in Charlotte during August and September, which leveraged the company’s 40th anniversary to drive traffic and transactions with rollback pricing on certain menu items. Bojangles’ also promoted a Pork Chop Griller Biscuit for $1.99 and five meal combos for $5 during October.

“We tried some things in the value front and learned a lot from our efforts over the past few months, and we will fine tune what we've learned. But ultimately, we believe that consumers are simply trying to balance the need for value and the desire to provide their families with quality, great tasting meal options made hot and fresh every day like what we do at Bojangles',” Rutledge said. “And because we don't have the marketing budgets and reach of some of our national competitors, we must be even more clever and creative. We cannot offer consumers low quality food at rock bottom prices just to get them in our restaurant. That approach simply isn't who we are, nor would it be possible for us.”

Rutledge said that Bojangles’ is reaching out to third-party experts to develop a marketing strategy and to evaluate efforts like pricing and marketing spend.

“Going forward, we need to determine what the right value promotions are for Bojangles'. Promotions that take advantage of the strength and familiarity of the core of our core menu and our established value proposition,” he said. “We also have to be aware how those value promotions impact our franchise partners, because we realize our franchisees must have profitable businesses as well.”

Bojangles’ will launch its limited delivery service test later this year or early next year at 10 restaurants in its home market of Charlotte, North Carolina.

“We believe conducting the test here in our hometown, a significant market for our brand and close to our support center, is important as we evaluate the results of the test. Again, this will be a limited test focusing on gathering data and real-world learnings to help make the best informed decisions regarding future efforts towards delivery. And we believe success in these areas will open up new opportunities for impactful marketing and more consistent consumer engagement, and I'm excited about the future of these efforts going forward.”

Shares of Bojangles’ have risen by about 4 percent since the market opened Wednesday.