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Sonic Toaster Melts Address Daypart Dilemma

Filed under Advertising, breakfast, LTO, Marketing

Facing a daypart marketing problem, Sonic Corp. today should announce new LTOs for lunch and dinner that have a familiar name.

The new offers are a pair of burgers on toast that aren’t exactly patty melts. The Bacon Cheddar Toaster Melt piles grilled onions, bacon, Cheddar cheese and hickory barbecue sauce on a beef patty and puts it all between two thick slices of Texas toast. The Mushroom Swiss Toaster Melt does the same build with grilled onions, sautéed portobello mushrooms, mayonnaise, Swiss cheese and beef patty. The Toasters are priced at $1.99 for Jr. size, higher for quarter-pound size.

If the Toaster name’s familiar it’s because Sonic uses it for its Breakfast Toaster sandwich, giving a bit of a breakfast echo to this lunch/dinner promotion. That’s all good because Sonic executives complained to analysts last month that promotions just aren’t having the sales-ripple effects across daypart like they used to.

“Historically, when we promoted an item, we found that we would see sales growth about across multiple day parts. But during this recessionary environment, that’s really not been the case,” Sonic Chairman-CEO Cliff Hudson said during the recent Q4 earnings call. He blamed Sonic’s problem, in part, on its having multiple dayparts, although McDonald’s, Burger King, Jack in the Box, Hardee’s and other competitors are similarly multi-daypart.

“Many of you know that we have, over the years, grown multiple dayparts so that we have business distributed across five dayparts: breakfast, lunch, afternoon, dinner and evening. So it’s been a challenge for us with this change in the economy to use the resources we have: dollars for advertising, menu items, new product news, to be able to move business across these multiple dayparts because of what I referred to earlier and that is prerecession, one promotion really driving business generally,” Hudson told analysts.

“Now, that promotion drives that product in the related day part but not generally. And so for our competitors that just have two day parts to drive, the majority—the significant majority of their business are surrounding or involved with lunch and dinner. It’s a different challenge for them driving same-store sales versus this five-daypart structure that we have built over the years.”

I think Sonic’s deeper problem was that the initial TV advertising done by new (as of February 2011) agency Goodby Silverstein & Partners was way off base. You may recall a werewolf and a vampire incongruously pitching the then-new Ring Leader burger in the early commercials. Humpty Dumpty pitched breakfast burritos. Hudson as much as admitted the problem last month. “When we moved to hamburger promotion early summer, May into June, we found that was not working in the manner that we had hoped and expected,” he said.

Now, Hudson said, Sonic’s advertising is “a little bit more food-focused.” That’s clear in the 30-second commercial for the Toaster Melts, which is all food, no Halloween costumes.