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Carls’ Jr., Hardee’s Sticking with Premium-Price Burgers

Filed under Advertising, Branding, Coffee, Menu, Nutrition

Ever the contrarian, CKE Restaurants CEO Andy Puzder thumbed his nose at most burger-chain trends as he vowed to keep Carl’s Jr. and Hardee’s selling indulgent burgers to “young, hungry guys.”

Expect more LTOs like the Southwest Patty Melt, not salads.

Specialty coffees like McCafé offers or frappés like Burger King has added? Nah. Puzder said he’s not interested in the “more-variety approach.” Also not appealing are the value menus that McDonald’s, Burger King and others are touting. He repeated his oft-given opinion that nothing edible is priced at 99¢.

Puzder dismissed any suggestion that Carl’s Jr. or Hardee’s might add more salads or other healthier fare. “I challenge anybody in the industry to come up with a healthier menu than ours,” he said during today’s Q4 earnings call. No doubt he was thinking of Carl’s Jr.’s Original Grilled Chicken Salad (270 calories, 9 grams of fat, 800 mg of sodium) rather than the current LTO, the Southwest Patty Melt Six Dollar Burger (890 calories; 63 grams of fat; 1,970 mg of sodium). Puzder said he’s “not feeling any pressure whatsoever” to add “healthy” items. In fact, he said he feels more pressure to come up with new indulgent burgers for the chain’s core audience of 16-to-24-year-old males.

“I think consumers are interested in more premium products as they have more money in their wallets, and we’re going to take advantage of that,” Puzder said. Aside from many markets in California, where Carl’s Jr. is heavily invested, Puzder says the company sees signs of some economic recovery.

Behind Puzder’s swagger was CKE’s earlier announcement of solid gains for Q4 and fiscal 2012, ended Jan. 30, 2012. For the year, Carl’s Jr.’s same-store sales were +1.9%, compared with -4.8% for 2011. Hardee’s comp sales were +5.2%, compared +4.4%. Fourth-quarter blended same-store sales for the two brands were +3.6%, compared with +2.3% a year ago. Average sales for the 1,313 Carl’s Jr. units was $1.411 million and $1.117 million for the 1,921 Hardee’s units.

Additionally, the chains report strong social-media response to last month’s Southwest Patty Melt campaign with model Kate Upton.