A&W; Better Beef. Better Eggs. Better Chicken.
Susan Senecal, President and COO
Tom Newitt, Senior Director of Marketing, Brand Communications
Robert Cifarelli, Manager, In-Restaurant and Online Communications
Sarah Hillifer, Manager, National Sales Promotions
Julia Cutt, Assistant Marketing Manager, Social Media
Chris Staples, Creative Director
Ian Grais, Creative Director
Leia Rogers, ACD
Eric Arnold, Art Director
Bob Simpson, ACD
Laura Rioux, Broadcast Producer
Lisa Nakamura ACD
Nic Quintal, ACD
Jordan Cohen, Writer
Michael Mayes, Writer
Kerry Bhangu, Print Producer
Alex Fleming, Interactive Designer
Anna Pellici, Interactive Producer
Max May, Writer
Sean O'Connor, Writer
Dan Szczepanek, Writer
Karine Doucet, Writer
Tom Shepanksy, Partner
Chelsea Stoelting, Partner, Group Account Director
Albane Rousselot, Account Executive
|Business Results Period (Consecutive Months):||Q1 2014- Q2 2015 (18 months)|
|Start of Advertising/Communication Effort: ||Q4 2013|
|Base Period as a Benchmark: ||2013|
If you’re going to make a change it might as well be a big one.
In 2012 A&W faced multiple challenges that required the iconic restaurant to significantly re-evaluate the most fundamental aspects of its business. Any one of these challenges would have prompted strategic reconsideration, but together they created the conditions for a change that has generated incredible results.
Since A&W opened its first restaurant in Winnipeg in 1956, offerings like the Mama Burger and Papa Burger, along with Root Beer in a frosty mug, have become entrenched on its menu and in the hearts of its Baby Boomer target. This target differentiated A&W from core competitors, since McDonalds, Harvey’s and Burger King have all traditionally targeted a younger demographic. For years this distinction served the brand well, but as Boomers have aged, their need for QSR has decreased. This started to limit the growth of the brand.
Several external issues compounded this challenge and magnified the need to re-examine the brand’s approach. First, new competitors were appearing in what has become known as the “fast casual” segment. Burger-based restaurants such as Five Guys and Hero Certified Burgers debuted with offerings that increased both the price and quality of burgers.
Second, in 2012 Canada was still stumbling out of the recession. While A&W definitely competes in a broadly affordable price segment, its core offerings are priced at a premium to competitors. There was an emerging need to provide a reason to help consumers justify their choice of a burger.
Third, many consumers were paying more attention to the quality of foods they were consuming. In the past few years an increasing number of people have begun to make food choices based on ingredients. More than avoiding cholesterol or trans fats, it’s an expectation that food be free of chemicals and processed ingredients. This started as a niche concern but has become more mainstream. Consumers initially focused mostly on foods found in grocery stores, but we wondered if there was an opportunity for A&W to introduce this notion to the QSR category. Whether it’s a burger or a breakfast entrée, people want natural ingredients. This growing expectation was part of the environment as we considered how to evolve the brand and the campaign that would communicate its promise and point of difference in the market.
Adding fuel to the fire were a few other considerations. A&W’s sales and guest counts were declining, and our major competitor was beating us on both “best tasting burger” and “best quality beef” scores. All this resulted in a new mission to create appeal with a new, younger consumer. It was apparent that this group had a real interest in the food they were buying, whether it was breakfast or a burger. They wanted ingredients they could feel good about eating. That meant two things. First we had to put these offerings on the menu, and second, we had to get the country to know about it.
Our primary business objective was to attract a younger consumer into A&W by first delivering a better burger experience, and eventually by repositioning the core menu offering on the basis of better ingredients.
The growing consumer demand for “better burgers”, as evidenced by increasing sales of premium burgers in QSR and rapid expansion of the fast-casual burger segment shaped the objectives set for the brand.
• Grow market share dollars in QSR burger to 14% in 2014.
• Increase same store sales by 3% in 2014.
• Increase guest counts by 2% in 2014.
•Grow A&W’s share of the QSR burger market among 25–44 year olds from 14% to 16% (Burger Servings) by December 31, 2017, and be the fastest growing in this demographic among QSR burger chains, ongoing.
• Reposition A&W as Canada’s only quick-service restaurant serving a great tasting burger made with pure natural ingredients, and achieve the “best tasting burger” score among QSR burger chains by December 31, 2017.
• Increase unaided ad awareness from 22% to 27%.
Over $5 million
Business metrics highlighted the need to evolve A&W’s position in the market, both in terms of the product and the core customer to be targeted. Still a number of questions had to be answered about how to communicate our story. Could our existing creative work or would a new campaign be necessary? At the product level, what was the optimal way to describe the significant changes to the offering itself? What claims and what language would be the most engaging and persuasive to spread the word about the new offering? All these questions were researched extensively.
Existing vs New Campaign
Given the magnitude of change it was important to examine whether our long running campaign featuring Allen, the A&W Manager, was the correct vehicle for the news. On the positive side, the campaign was well known, meaning we could focus exclusively on the news at hand and wouldn’t need to spend time establishing a new creative platform. Conversely, an established campaign is sometimes not the best choice for significant news, as familiarity can make it difficult for consumers to notice the new content.
We tested multiple concepts to determine if Allen was our best messenger. Research determined Allen was indeed a persuasive asset. People found him incredibly likeable, honest and trustworthy – essential considerations in delivering our message. We also tested a “Man on the Street” concept using Allen against creative that used more scripted approaches. Consumers were incredibly positive about the real world scenario and resoundingly preferred it to fictional situations.
While the idea of better ingredients is pretty straightforward, since it really is all about ingredients in their natural form, subtle nuances in language can have a significant impact on how well consumers understand and embrace the message.
We set out to understand what Canadians thought of as “Better Beef” and what would drive appeal, differentiation and intent to switch brands. The standout area was for a more natural type of beef and within that “raised without the use of hormones or steroids” was the single most appealing and differentiating idea.
Determining the scale of the opportunity
Along with the key variables of campaign style and language, there was another important strategic question: should product reformulation be restricted to the signature burger offering, or should it extend to other core menu items?
Our research indicated consumers were increasingly looking for better quality ingredients, food without unnecessary additives that has been raised respecting the planet and animals. This attitude has grown in incidence and has grown in terms of where people expect to be able to find this kind of food. In the early days it required a trip to an organic market. Eventually specialty stores like Whole Foods were a source. Now it has become something that mainstream supermarkets are offering.
One place consumers definitely weren’t expecting to find it was in quick service restaurants. The association of most QSR restaurants with indulgence, taste and convenience meant people didn’t expect this level of quality. We believed being the first QSR restaurant to challenge this could be powerful, and we turned to research to confirm this.
We replicated the claims research for Chicken as well as Eggs to understand the claims that were most important to Canadians when it came to these ingredients. It wasn’t just better burgers that interested people it was better chicken (antibiotic-free and vegetarian-fed) in hot chicken sandwiches, and better eggs (from hens fed a vegetarian diet without animal by-products) on the breakfast menu. This was significant since chicken and breakfast options are among the fastest growing segments in the QSR industry, and provided the opportunity to further distinguish A&W from its competitive set.
The product story for this initiative is a very tangible one but interestingly the benefit it creates in people’s minds is very emotional. Today, consumers want an indulgent burger (or breakfast or chicken sandwich) but they have concerns that fast food comes with food quality issues. When those concerns go away, not only do people feel better about the food their eating, the food itself actually tastes better. In a category where consumers vote with their taste buds, this provides a critical point of differentiation.
Our communications strategy rested on four core principles.
Make the most important part of the story the hero.
We had a meaningful story to tell. The hero of the campaign was the product news – nothing was allowed to get in the way of that.
Leverage Allen but let others to do the talking.
An authentic product is the core of the campaign. Traditional scripted ads would be at odds with this, so we went unscripted. We filmed real people across the country as they sampled the new product and we encouraged them to give us their honest response. Their positive feedback was as authentic as the product itself.
Reinforce great taste.
It can be hard for people to detect the lack of an ingredient but they can easily detect the thing that’s critical to every burger lover: great taste. Even with the desire for more natural ingredients, a given food choice can be 100% pure but if it isn’t delicious, it won’t really matter. Taste appeal had to come through in everything we did.
Introduce the message and reinforce it repeatedly.
We had a big product change for people to absorb. Being the first to do it required some heavy lifting just to get people to think about what was - or wasn’t - in their burger. The category is dominated by a short-term promotional burst campaigns, but our message needed reinforcement, both in media and creative. We committed to an ongoing campaign to really land the brand promise.
Online Display Advertising
Social Media – Facebook
Past campaigns featured Canadians coming into to A&W restaurants. To launch the Better Ingredients initiative, we took A&W across Canada.
Our launch commercial showed Allen leaving the restaurant and heading out into the real world. The “man on the street” concept featured Allen talking to real people, getting their genuine opinions on the taste and quality of our new burgers. This approach added transparency, generated brand advocates and earned word of mouth endorsement.
We followed up the Beef Guarantee with a $3 Teen Burger promotion, incentivizing consumers to come in and try our new beef for themselves. Inside the restaurants we reinforced our mass media advertising with new POS creative.
Next came the Chicken and Egg Guarantees. This kept A&W top of mind for consumers throughout the year and solidified for Canadians that A&W was doing things differently in the competitive fast food market.
The campaign had a strong online presence which was very product focused. We knew the messaging would spark questions for consumers, and an online presence featuring a website explaining our Ingredient Guarantees, display advertising, and a Facebook campaign provided answers and encouraged ongoing conversation.
The campaign was friendly, down-to-earth and very approachable, in keeping with brand and with the nature of the message that needed to be conveyed. We asked men and women, Boomers and Gen Xer’s, Westerners, Easterners and everyone in between what they thought of our new products, and their positive responses convinced other Canadians.
An important consideration was determining how to communicate our message to our 25-44 year old target audience. We needed to think about the advertising mediums, platforms, and content that our target regularly consumed. We were also challenged by the size of our marketing budget. With only a quarter of the budget of our larger QSR competitors, we knew we had to spend our advertising money wisely.
We launched our first Ingredients Guarantee, “beef raised without the use of hormones and steroids”, in August 2013. We chose marketing tactics that activated every level of the marketing funnel. Building mass awareness was our first goal. We bought more weeks of television advertising, at lower frequencies, in order to keep our message top of mind. Knowing that our target spends considerable time online, we ran our message as 15 second pre-rolls and developed rich media display advertising as well as a social campaign on Facebook.
We looked to three core areas as the measure of the campaign’s success: business results, advertising metrics, and brand health. Every single measure has grown significantly during the campaign.
MARKET SHARE GROWTH
Our goal was to grow our market share dollars in QSR burger in 2014. Evaluated on an annual basis, A&W’s share has grown at 3 times the rate of any other scale competitors showing growth. The two other brands leading the market, McDonald’s and Wendy’s both lost share during this time.
See Chart 1: Market Share Growth
INCREASE IN OVERALL SAME STORE SALES
Quarterly sales reflect sales increase versus the same period the previous year. Net same store sales since launch have continuously exceeded the ingoing goal for 2014 of +3%. The first two quarters of 2015 show even stronger growth. We now have six straight quarters of growth.
See Chart 2 Increase in Same Store Sales
INCREASE IN SAME STORE BURGER SALES
Burger sales have also shown constant growth.
See Chart 3 Increase in Same Store Burger Sales
INCREASE IN CONSUMPTION AMONG 25-44 TARGET
Consumption has grown significantly since the inception of the campaign, specifically among the target we intended to attract. We had established a goal of growing A&W’s share of the QSR burger market among 25–44 year olds from 14% to 16% (Burger Servings) by December 31, 2017. This was achieved by the end of 2014, well ahead of schedule and in an environment when all major competitors’ share has declined.
See Chart 4 Increased Consumption Adults 25-44
BRAND EQUITY MEASURES
The numbers for brand equity show the same positive results as sales and campaign awareness.
As of Q3 2014, A&W overtook category leaders Wendy’s and Harvey’s against the measure of "making food the right way". Since then we have maintained the number one position.
See Chart 5 Brand Equity 1
On the related measure of "serving good quality food" A&W took category leadership from Harvey’s and Wendy’s in the first quarter of the campaign and has maintained it ever since.
See Chart 6 Brand Equity 2
We achieved our objective of becoming first nationally with the “best tasting burger” score among QSR burger chains two years ahead of the December 2017 goal.
See Chart 7 Brand Equity 3
INCREASE IN TRUSTWORTHINESS
A strong indication of campaign impact is trustworthiness. A&W is the only brand in the category that is growing on the measure of trustworthiness.
See Chart 8 Brand Equity 4
The primary advertising metrics for the campaign’s effectiveness are unaided brand awareness, claimed ad recall, and advertising appeal. These are indicators of breakthrough and likeability. The charts below demonstrate how A&W has gained ground relative to the top two performing QSR brands for each metric since the launch of the campaign (results versus remaining QSR competitors are even stronger). In all cases A&W has demonstrated continuous momentum quarter over quarter versus competitors.
INCREASE IN UNAIDED BRAND AWARENESS
Since launch unaided brand awareness for both McDonalds’s and Harvey’s has dropped, while A&W’s has grown.
See Chart 9 Unaided Brand Awareness
INCREASE IN UNAIDED AD AWARENESS
Our ingoing goal was to increase unaided ad awareness from 22 to 27%. We achieved 28% unaided ad awareness, contrasted with significant drops for the same measure for all competitors.
See Chart 10 Increase in Unaided Ad Awareness
INCREASE IN ADVERTISING APPEAL
A&W already led the entire category in advertising appeal. Since launch, our lead over the next two strongest competitors has grown even stronger
See Chart 11 Increase in Advertising Appeal
INCREASE IN GUEST COUNTS
Despite a 2 year decline in total QSR visit, we overachived our objective of increasing traffic by 2%.
See Chart 12 Increase in Guest Counts
The 2014 communication investment (media and production) was $15 million. Burger sales alone increased from $890.6 million in 2013 to $986.8 million in 2014, a lift of over $96 million.
While the product improvements pioneered by A&W are critical contributors to the business success, the campaign developed to spread the message across Canada has unquestionably achieved its task as well.
Majid Khouri, the researcher and objective observer contracted by A&W to measure the campaign, notes, “In 25 years of conducting ad evaluation research across North America, this is the first campaign I’ve seen where nearly everyone in the target who says they have seen TV advertising for A&W can describe, unaided, specific elements of the creative, reflecting an amazing ‘sticking power’ of this campaign. Add to this the significant positive change in brand perceptions we see in the tracking research happening in few months, as opposed to a year or more, further confirms this is the best performing campaign I have seen from an ad tracking perspective.
A&W’s media spend is approximately $15 million, dramatically less than other QSR brands. A&W did not increase spending significantly since it is a fixed percentage of sales.
Although better ingredients add extra cost A&W has not altered prices. Higher volumes offset higher input costs and the price to consumers remained constant.
Although A&W has added new locations during the campaign, all results reported here are based on same stores sales results. Distribution is constant.
Unusual Promotional Activity:
A&W actually reduced price-focused activity and, for limited time offers, switched to promoting the ingredient messaging (i.e. the spicy guacamole Teen burger made with fresh guacamole).
Other Potential Causes:
The market is competitive and overall QSR visits are flat. A&W is convinced the strategy and its execution are working: the company is experiencing its best results since it all began back in 1956.