Wendy's New Twist, Pretzel Buns, Tests Well

It may not be the solution to its low ranking among Hispanic consumers but Wendy’s is poised for the national rollout of a Pretzel Bacon Cheeseburger that has reportedly tested extremely well in markets such as Miami and Northeast Ohio and led Janney Capital Markets analyst Mark Kalinowski to predict that same-store sales will increase 3% to 5% after its launch “at some point during 2013.”

Nation’s Restaurant News’ Mark Brandau broke the story of Kalinowski upgrading Wendy’s stock from “neutral” to “buy” based on sources telling him that the test of a burger tucked inside a roll that somehow evokes a pretzel “was one of Wendy’s most successful … from the last 20 years.” But he tempers the rave review with a more cautious observation from Technomic EVP Darren Tristano.



“My immediate reaction would be don’t bet on the bun,” Tristano says. “It’s all about the beef, so I’m not so sure a pretzel bun introduction is going to be as big an impact as would be necessary for someone to make an advised, intelligent decision about buying their stock.”

For its part, Wendy’s is remaining “mum” about the whole thing, USA Today’s Bruce Horovitz reports. “We're not sharing details of this sandwich today," spokesman Denny Lynch writes him in an e-mail. "It's not in any of our restaurants.”

That said, Christopher Muller, professor of hospitality at Boston University's School of Hospitality Administration, tells Horovitz that  “this could be a very, very big deal. I don't know why, but there's nothing else on the market quite like it.”

And if it proves as popular as reports have it, he predicts that others will surely follow. 

Ad Age’s Maureen Morrison, meanwhile, reports that a new study by market-research firm Placed finds that Hispanics were least likely to visit Wendy's, which is now the No. 2 burger chain, compared to McDonald's, Burger King and Taco Bell.

The report, "Dining Out in America: The Quick-Service Restaurant Landscape,” is based on a survey of 70,000 U.S. smartphone panelists in April. It found that Hispanics are 16% less likely to visit Wendy's than the average U.S. consumer.

“While the report didn't give specific reasons, it's likely Wendy's is not high on Hispanics’ fast-food list in part because the chain isn't spending as much to lure the demographic as are rivals,” Morrison observes. Although she cites a new campaign launched earlier this month that targets Hispanics, it only spent about $11.7 million on Spanish-language network TV in 2012, according to Kantar Media data, compared to McDonald’s spending nearly $85 million on Spanish-language networks.

“At nearly 17% of the total U.S. population, Hispanic consumers represent a rapidly growing customer base for foodservice operators,” a Technomic report released in April stated. “As Hispanic buying power climbs by 50% to $1.5 trillion in 2015, this group will have a larger economic impact at restaurants and other foodservice locations. Restaurant operators and suppliers that understand their unique preferences will be well-positioned ….” 

The chain is not staking all of its future on the baker’s oven, however. The Packer, which covers the fresh produce industry, reports that it “plans to buy 2 million pounds of strawberries and 1 million pounds of blueberries from now through September to meet customer demands for the seasonal salad.” It also reports that Wendy’s salads were rated by Zagat’s as No. 1 in the fast food category -- beating out Panera, Chipotle and Subway -- last year.

Despite Wendy’s reticence about discussing its buns at present, it hasn’t been keeping its thoughts about the value of breads totally under wraps.

“Wendy’s began testing pretzel bun burgers this year and discussed its plans to play with its breads, including pretzel buns and flatbreads,” with Columbus BusinessFirst reporter Dan Eaton last summer.

“Five-star breads at three-star prices,” Gerard Lewis, Wendy’s SVP of culinary innovation, told him at the time. Eaton wrote yesterday that “I’m still waiting on that Bahn Mi sandwich Lewis mentioned.” It reportedly consists of grilled chicken, cilantro, tomatillo sauce, cucumbers and carrots. And a Hawaiian Teriyaki with chicken, a ginger-based Asian sauce and grilled pineapple, peppers and onions.

With a condiment or ingredient for just about every taste in the North American marketplace -– including hard-boiled reporters -- it sounds like a concoction cooked up by a marketer, doesn’t it?.

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