Online Exclusive: Marketing News

WENDY'S OVERHAULS MARKETING STRATEGIES

Boosts Budget, Readies First Online Ads, Segments Audience, Plans Product Placements

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CHICAGO (Adage.com) -- After falling behind resurgent rivals with two failed post-Dave Thomas advertising campaigns, Wendy’s International is shedding its folksy image and one-size-fits all message.
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In its place, the burger chain is returning to its square hamburger roots, boosting its marketing budget, targeting three distinct consumer groups and making its first foray into Internet advertising. It appears that Wendy’s has adopted an “If you can’t beat 'em, join 'em” strategy.

Competitve category
“It’s no secret we’ve faced some challenging times at Wendy’s,” said Ian Rowden, executive vice president and chief marketing officer. He said the number of competitors grew from 15 chains that can generate a $1 billion in revenues to 24 by 2004. Wendy's is the third-largest burger chain behind McDonald's Corp. and Burger King Corp.

Since the company's founder, Dave Thomas, died in 2002, the burger chain named for one of his daughters has struggled to find a voice for its ad messages that was as effective of his. Mr. Thomas who starred in more than 800 commercials over 13 years. Wendy's even tried using an "unofficial" spokesman, "Mr. Wendy," a hapless burger evangelist. Wendy's dumped the widely criticized campaign after only eight months. The chain's agency is Interpublic Group of Cos.' McCann Erickson Worldwide.

“We don’t have to be folksy to be what the Wendy’s brand is,” said Mr. Rowden. “The Wendy’s brand has always had a little attitude. Dave had a little attitude and he pushed things differently, but the way the brand was personified through him made it more folksy.”

Period of transition
“The offerings consumers faced in our world have changed a lot,” he said. “Our competitors quite simply got better at what they do, and Wendy’s has been in a period of transition, particularly from an advertising perspective. We have been somewhat out of the dialogue over time, and it’s time for us to take some fairly decisive action on a number of fronts.”

That includes bringing new products to market faster, taking advantage of its reputation for quality service and better advertising.

Mr. Rowden said the 36-year-old brand, for the first time, has targeted three demographic groups: baby boomers, its traditional core; young adults he called Gen Mers, also known as millennials; and Generation Z, who will affect the business going forward.

“We can leverage what we have in different ways to different groups,” he said. “One message at one time broadly targeted for one group doesn’t play anymore for Wendy's.”

New tagline
Built from the consumer insight that taste is what sets Wendy’s apart from its competition, the chain today unveiled its new advertising campaign, “Do What Tastes Right.” The effort is built for flexibility across Wendy's core menu, new products, late-night openings and choice offerings, with additional taglines like “Do Spicy” and “Do Fresh.”

To reach the young adults who love hamburgers, Wendy’s created a character called Smart Square for ads for late-night TV and on the Internet (www.goodtobesquare.com).

Using the Internet
"We knew we weren’t using the Internet in the way we should," Mr. Rowden said. "(This time) We did it in a different way and in a way we hope is a clever way. That square hamburger patty is a positive equity and it’s also what differentiates us.”

On the Web site, Smart Square stars in a 60-second video trailer to introduce the character and round “beadicons” or “beadies,” which serve as metaphors for round burgers. “It’s not Wendy’s trying to be hip but Wendy’s saying we’re in touch with the attitude, mindset and programming of people who love heavy hamburgers,” Mr. Rowden said.

Rival Burger King as had success online with its Subservient Chicken, from MDC Partners' Crispin Porter & Bogusky, Miami.

For older consumers, the trio of raccoons launched in ads last month to illustrate that the chain remains open late will continue and will be expanded for the effort.

Humorous ads
Other creative pushes the edges of humor, harkening back to Clara Peller ("Where's the Beef?"). For its Spicy Chicken line, one spot shows people drinking from a fish tank and a swimming pool to cool down after eating the sandwich. For its Value Choice menu, the chain cleverly spoofs reality dating shows, as a woman decides between five choices for a side item. (In fact, the actress in the ad was on an early episode of dating show Average Joe.)

Wendy’s is boosting its advertising spending, but Mr. Rowden wouldn’t provide a figure. National spending will support TV, print and Internet, and local media buys will support spot radio and TV and out of home. All media will be bought carefully to match the creative with the target and the medium. In the coming months, the chain also will explore product integration with “some pretty high-profile programs,” Mr. Rowden said.

Mr. Rowden is mindful he will be measured by the advertising, but he’s most excited about the strategic shifts to bring the brand into a new era.

Making a bold statement
“We did take some risks,” he said. “I felt really strongly that we needed to make a kind of bold statement. The environment has changed around us and the brands are blurring. We needed to restate ourselves, but in way that holds true to the core brand.”

He admitted that the chain’s product pipeline “dried up” in the 2004 and that new efforts are under way to boost the line. The new feel will be integrated throughout the chain from new store concepts to crew uniforms to signage.

“Advertising isn’t a silver bullet for us,” he said. “The advertising is a risk, but I’ve got faith in the creativity of it. I’ve always believed if you’ve got the strategy right and the right people, you can push it.”

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