Wingstop has announced that it is shaking up its management organization to bring together marketing and information technology. Seeing that 25 million consumers now place orders on the brand’s digital platform and that 65% of orders are now digital, Wingstop has set a bold goal of reaching 100% of digital orders.
This bold move not only represents a major salvo in the rapidly escalating digital arms race underway in the fast food market, but it is also proof of the awakening of brands to the power of personalized marketing and why it is vital to focus marketing resources beyond traditional mass marketing approaches.
The digital arms race
Many physical brands learned the hard way during the COVID-19 pandemic that the infallible means of mass communication they had used for decades, such as live sports sponsorship on TV, suddenly failed to succeed. reach their audience.
Meanwhile, brands that have built invaluable first-party data by investing in their own media channels – including text and messaging clubs, loyalty programs, and branded apps – have retained much more control. great for reaching their customers, especially during the pandemic when communication speed was critical.
Dining rooms closed? Orders only accepted online or through the app? Cut hours? No problem. Brands could use their own media channels to reach customers anytime and as often as needed, without having to rely on paid media to get the word out.
Additionally, COVID restrictions have forced consumers to transact through low-contact technologies, such as online ordering, curbside delivery and pickup. The resulting major shift of customers to digital channels has put traditional brands on a full-scale rush, struggling to catch up with consumers’ growing digital expectations.
Think about it: before the pandemic, how often did you order online or through the app from your favorite QSR brand? For most of us, the answer is literally never. We just hopped in the car, walked through the drive-thru to order and collect our food. But now, even though in-person dining options have returned (at least for now), digital orders now account for 28% of all orders compared to 10% before the pandemic, according to the Boston Consulting Group.
This digital awareness of consumers represents both an opportunity and a risk for QSRs. For those who are able to respond and enable consumers to transact and communicate digitally and do it well (that is, deliver Amazon-like experiences), they can grab the opportunity for growth. But that same digital alarm clock also means their once-loyal customer base who defaulted to the convenience of the nearest two or three drive-thru windows may not be as loyal now.
Order online and curb pickup or have it delivered DoorDash has opened up many other options for lunch or dinner. Travel a mile or two past your nearest options, and in most places you’ll have a dozen or so viable options to choose from.
The massive exodus from offices to working from home has also changed options and jeopardized customer loyalty. In fact, new customers accounted for over 65% of all online orders this year, according to Paytronix’s Order and Delivery Report, and 81% of QSRs report that their customer bases have changed due to the pandemic, the National Restaurant Association reported earlier this year.
Wingstop’s reorganization is proof that QSR brands realize they need to adopt structures that align IT and marketing functions similar to that of a tech company. Brands are competing with loyalty programs and stepping up investments in digital channels and owned media in a race to build a treasure trove of first-party data. First party data will become more critical than ever in a digitally driven world and soon without the ability to target consumers with the proven third party cookie targeting many brands that many brands have relied on in their digital advertising.
Validation of the importance of one-to-one marketing
Perhaps the most revealing phrase from Wingstop’s announcement was its plan to have two separate agile and collaborative teams that focus on different levels of communication with guests. “One will lead the ‘micro’, one-to-one communication, and the other will lead the ‘macro’, one-to-many communication.” Alleluia!
I am delighted to see the brands finally move from mass marketing to individual marketing and organize teams around the concept. The fast food industry has spent decades inventing the next big bother (“Where’s the beef?”). They measure success by measures of range and frequency that are decades old.
Sometimes it’s like hearing the sound of the needle scratching the record when talking to SMS marketing brands. A media channel owned as SMS will not broadcast 30-second TV spots to 100 million consumers. Instead, you create a highly organized, loyal but relatively small audience of millions of consumers with whom you can build one-on-one engagement and relationships. Too often, for traditional marketers, their perception is that it just doesn’t seem like “the juice is worth it” (one of my favorite phrases I learned living down South for a few. years).
Yet the world has changed. Consumers are now in control of what, when and where to digest news, content and entertainment. Unlike my generation who planned our weekday evenings when our favorite ‘must-see’ TV shows were on and dreaded the cliffhangers that wouldn’t be resolved until the fall, when the new season began, my 20-year-old didn’t. has no idea of the day, night or even in network, his favorite shows are broadcast. She streams everything to every device, anytime, in any order she chooses. Personalized marketing is the only way to achieve it.
More and more QSR brands are starting to see the power of one-to-one marketing. Kim Lewis, Vice President of Digital Strategies for Inspire’s Sonic Drive-In, recently said in a conversation for MediaPost, “While email is a pretty impersonal relationship, texting is a pretty intimate relationship and requires a bit of trust.” She says it’s “one of our most powerful communication channels,” and instead of measuring success by reach and frequency of audience, the company actually uses focused metrics. on the CEO, such as frequency of customers and increase in sales. “Literally the second we push that button, we start to see customers ordering this item and taking advantage of this offer at the drive-in. “
I take my hat off to the direction of Wing stop for recognizing that traditional one-to-many mass marketing techniques are not the only way to build brand and sales in a digital world. And, with this announcement, he’s making a significant organizational change to embrace personalized marketing. Especially in the world of QSR marketing where the majority of the eggs have been placed in the mass marketing basket for so many years. Expect to see more to follow.
Chuck Moxley is a marketing leader with over 25 years of experience developing innovative marketing programs for dozens of B2B / SaaS companies and consumer brands. In addition to being the Senior Vice President of Marketing at Mobivity, he is a leading national expert on technology and marketing convergence and co-author of Audience of a, a book on revolutionary marketing strategies to change consumer behavior and increase revenue.