Wingstop apparently scored during the Super Bowl.
The NFL’s annual championship game, which has almost singularly taken chicken wings from an obscure product into a major industry menu item, has long been a strong sales day for the Dallas-based chain.
But this year the company sold 16 million wings on game day. “It was a great success for us,” Wingstop CEO Charlie Morrison said on the company’s fourth-quarter earnings call Wednesday. He said that the company had a “nice, strong comp” on the day.
The Super Bowl was part of what Morrison said was a “strong start to the year” following a good end to 2018. Wingstop’s same-store sales rose 6% in the quarter ended Dec. 29, capping off a year in which its systemwide sales rose 16% to $1.3 billion and its annual same-store sales rose 6.5%—its 15th-straight annual increase.
The chain now operates more than 1,200 locations worldwide, about 1,100 of which are operated by franchisees.
Wingstop didn’t provide any details other than the “strong start” comment. “We do feel very good about how we’re coming out of the gate,” Morrison said.
But the company also has high hopes for the rest of the year, in part because of an increase in the chain’s marketing and digital efforts that Morrison believes will continue building sales.
Wingstop increased its national ad fund contribution rate for the chain’s franchisees as well as its corporate stores from 3% to 4% of topline sales growth, starting Jan. 1. That, plus the increase in the chain’s overall sales, means it has a 50% increase in marketing resources.
Morrison wants to use those resources “to attack the 20% gap to our QSR peers in brand awareness.”
“That’s an essential first step in attracting and retaining customers,” he said. “We have a huge opportunity to expand our audience to QSR users as they learn about Wingstop.”
The company is planning to concentrate its television advertising in two 12-week waves. The first one started last week. The second one will start just before the football season begins later this year, when chicken wing consumption increases.
Wingstop also has hopes for increased digital orders and delivery.
Digital now represents more than 30% of the company’s sales, and Morrison said that Wingstop’s long-term goal is to convert all of its orders to digital in some form or another. And Wingstop launched a custom online ordering site and mobile app that has early on increased guest check by 50 cents.
“Digital is important,” Morrison said, noting that the orders have a $5 higher average check than typical orders. And he believes the company can “drive digital without employing discounts and incentives” like other chains.
Wingstop is exploring other areas to drive more digital sales, including self-order kiosks, pickup lockers and a new kitchen display system in the restaurant.
Delivery is another potential area of growth this year. The company has the service available in 30% of the system and by the end of the year that will be up to 80%—at which point Wingstop could start marketing the service.
It’s a more deliberate approach than other companies have used, but Morrison said that approach is working to generate incremental sales.
“We did very intense testing with company stores as well as brand partners to understand the impact delivery will have on the business,” Morrison said.
He added that the company is already 75% takeout. Yet delivery and carryout customers are “two distinctly different guests” with only about 20% overlap. “So 80% should be incremental to the business,” Morrison said. “We think we’re one of the best, if not the best brand positioned for delivery.”
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