Industry News | May 11, 2017 | By Alex Dixon | QSR Exclusive Brief

Wendy's Focus on Freshness Drives Strong Sales

Fresh beef? Wendy's says it has led the movement for nearly 50 years. Wendy’s
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Continued marketing around value and ingredients drove Wendy’s to its 17th consecutive quarter of positive same-store sales.

Shares of the brand jumped to the best level in nearly 10 years Wednesday as earnings outperformed analyst estimates for Q1 2017. Wendy’s North American same-store sales increased by 1.6 percent, 0.1 percent behind McDonald’s Q1 2017 sales and ahead of Burger King’s relatively flat sales growth.

“We continue to scream from the rooftops [that] we have a key point of differentiation—fresh, never frozen, North American beef—but we also complement that with great offerings like our 4 for $4, all embedded and grounded in the quality messaging that we have to set ourselves apart,” Wendy’s president and CEO Todd Penegor said in a conference call Wednesday. “As you think about where the landscape is going, we’ve been very disciplined on price for the last several years.”

Wendy’s added its Double Stack burger to the 4 for $4 lineup while also bringing back its popular North Pacific cod sandwich and highlighting its Asiago Ranch Chicken Club in marketing efforts.

And while McDonald’s recently announced a plan to implement fresh beef nationwide by mid-2018 for its Quarter Pounder burgers, Penegor says Wendy’s has been doing it all along and it’s what customers want.

“[McDonald’s] came out with their announcement, we had some fun in the social landscape and social media with that because it does create more awareness and some credibility to what we’ve been saying for almost 48 years,” Penegor says. “Fresh, never frozen, North American beef tastes better and the consumer prefers it. And they must be seeing the same thing if that’s where they need to go.”

Penegor says the brand is going to continue highlighting freshness in its marketing, from “whole heads of lettuce and fresh chopped vegetables every single day” to its move back to original buns and mayo in its burgers and investing in smaller birds to make sure chicken filets are tender and more juicy.

Wendy’s is also on track to have half its restaurants up on mobile ordering by the end of the year, and is testing delivery and a loyalty program. By 2020, the company hopes to achieve $12 billion in sales along with 7,500 global restaurants.