What can the media business learn from the $5.00 Footlong? Plenty. Businessweek just featured an article called "The Accidental Hero" which chronicles franchisee Stuart Frankel who pioneered the $5.00 footlong pricing at his two Subway restaurants in Florida that were suffering in the recession....
"Stuart Frankel isn't what you'd call a power player in the world of
franchising. Five years ago he owned two small Subway sandwich shops at
either end of Miami's Jackson Memorial Hospital. After noticing that
sales sagged on weekends, he came up with an idea: He would offer every
footlong sandwich (the chain also sells 6-inch versions) on Saturday
and Sunday for $5, about a buck less than the usual price. "I like
round numbers," says Frankel, a brusque New Yorker who moved to Miami
in 1972 and owned a drugstore before opening his first Subway outlet in
1988.
Customers liked his round number, too. Instead of dealing with idle
employees and weak sales, Frankel suddenly had lines out the door.
Sales rose by double digits. Nobody, least of all Frankel, knew it at
the time, but he had stumbled on a concept that has unexpectedly
morphed from a short-term gimmick into a national phenomenon that has
turbocharged Subway's performance. "There are only a few times when a
chain has been able to scramble up the whole industry, and this is one
of them," says Jeffrey T. Davis, president of restaurant consultancy
Sandelman & Associates. "It's huge."
In fact, the $3.8 billion in sales generated nationwide by the $5
footlong alone placed it among the top 10 fast-food brands in the U.S.
for the year ended in August, according to NPD Group."
What can we adapt out of the story?...
1) Help your clients determine the right pricing strategy. Don't be afraid to ask about margins, what products in the line won't work at the defined price, and how to position that in the marketplace.
2) Always have a value proposition in mind. Subway didn't have to tell customers that they could split the sandwich with a friend or save half for later, but imitators have to share that message and market themselves as competition. Make your value proposition obvious.
3) Use a jingle or catch phrase that people can sing or imitate and play it up. I bet everyone reading this can sing the $5.00 footlong jingle. Help your client become the Top of Mind Awareness leader in their category. Do you have clients in your market that you can sing the jingle to? You should.
4) Know when to optimize the campaign. Subway learned early on that certain sandwiches were not feesable under the pricing structure so they excluded them but left a good selection which didn't tarnish the image to the public.
5) Don't be afraid to go viral. YouTube is full of $5.00 footlong wannabe's, your property website can also host the viral effect and even become the instigator in contests to create the jingle or to do it best.
6) Be looking for the next opportunity. Subway franchisee's are exploring loyalty cards (in my market they already have them and we have been using it for 5 years) or other means to build repeat business and brand equity. What innovative campaign can your clients execute with your coaching?