Marketing 50

Hardee's

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Two years ago, one would never have guessed Hardee's would be considered among the better burger joints. During much of 2002, sales were dropping 3% to 4% every month. Industry observers were predicting the CKE Restaurant chain's probable demise within a year.

Desperate to revive the brand, management chucked more than three dozen items from its menu and beefed up its fried "skinny, little burgers." It did so with a clone of its grilled Six Dollar Burger at sibling chain Carl's Jr. , with patties of one-third to two-thirds of a pound of 100% Angus beef. The Thickburger was the linchpin of Hardee's turnaround plans.

"We literally threw out the old fast-food cost-based paradigm for product development and made every ingredient as good as we could make it," says Brad Haley, exec VP-marketing for both brands, who joined Hardee's from AFC Enterprises' Church's Chicken. The 46-year-old fast-food veteran who led the menu revamp had seen worse turnaround prospects when he was VP-marketing for Jack in the Box and helped that chain recover from a devastating E. coli contamination.

Market by market, Hardee's closed stores for the one-night overhaul and opened with its new image the next day. The chain spent most of its $60 million ad budget on a series of painfully frank apology ads via Mendelsohn/Zien, Los Angeles. The ads "basically said that we had screwed up in the past," says Mr. Haley.

Hardee's rocketed 30 points in taste and quality ratings to third behind Wendy's International and Sonic Corp. from worst among its peers, according to Sandelman & Associates' Quick-Track, which named the chain most improved. Hardee's posted its 15th straight month of same-store sales and average unit volume gains, with fiscal year-to-date comparable sales up 8.7% vs. a 0.7% decline the same period the year before.

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