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Wendy’s Restaurants: The World’s third-largest quick-serve hamburger chain

Wendy’s Corporate Profile

Wendy’s Company (NASDAQ: WEN) is the world’s third-largest quick-serve hamburger chain globally, with more than 6500 franchise restaurants (80 percent are franchised) and Company restaurants in the US 29 other countries. It claims to serve the best hamburgers in the business, made with fresh beef hot off the grill and a choice of toppings. They also serve chicken sandwiches, fries, Frosty, soft drinks, and various fresh, healthful foods—salads, grilled chicken sandwiches, baked potatoes, and chili. Wendy’s International Inc. also owns Tim Hortons, Canada’s largest coffee and fresh-baked-goods restaurant chain, and Baha Fresh Mexican Grill, the quality, fast-casual Mexican food leader.

You can find the historical story of Wendy’s at:

Present Situation

Wendy’s management said it was planning to enter the UK market with “company-owned and operated” restaurants in early 2021. Furthermore,  recently a spokesman for the burger chain said the Company was “very much looking forward” to returning to the UK, having attempted this in the past.

The chain ran around ten company-operated UK restaurants in the 1990s but pulled out in 2000, blaming high property and operating costs. Wendy’s was founded in 1969 in Columbus, Ohio and today employs more than 6,800 restaurants worldwide. (12 Nov 2020)

Reading is set to be home to the firm’s first branch – almost 20 years after it closed its UK outlets to concentrate on its North American base. Wendy’s said it was planning to enter the UK market with “company-owned and operated” restaurants in early 2021.

A spokesman for the burger chain said it was “very much looking forward” to returning to the UK.

A city council planning application revealed the chain is set to move to a former Nationwide bank in Reading’s Station Road, according to the Local Democracy Reporting Service.

It said it had chosen Reading due to the “right mixture of foot traffic,” “a strong employee base,” and it is a “major transport hub.” A spokesman said: “I can confirm that Reading will be our first site and that the brand was very much looking forward to it and excited about the future as we enter this market.”’s%20said%20it%20was%20planning,to%20returning%20to%20the%20UK.

In 2004 Wendy’s announced that the chain’s national advertising campaign featuring Mr. Wendy would be withdrawn at the end of November, to be replaced with a “Combo choices” campaign that would focus directly on the products served. The Mr. Wendy campaign, which featured a hired spokesperson in the wake of founder Dave Thomas’s death, was poorly received by the public. For some, it was just plain irritating. _________________________________________________________________________

Adapted from A Canadian Case Study on Wendy’s Inc. and Malhotra, N.K (2009), Marketing Research: An Applied Orientation: Global Edition, 6th Edition, Pearson Higher Education

While not admitting the campaign was a failure, it is apparent that competitors have Wendy’s on the run. The number three hamburger chain in the United States (Wendy’s is number two in Canada) was hurting. By the end of 2004, same-store sales (stores that had been open at least a year) had fallen 2.1 percent compared to the previous year. In a competitive market, such a drop signals an urgent need for change.

Wendy’s seems to have been hurt by rivals that finally achieved menu parity from a competitive viewpoint. Wendy’s has long been perceived as the chain with the “healthiest” offerings among the hamburger chains, but over the past 18 months, both McDonald’s and Burger King have introduced upgraded products and salads. Another possible factor affecting Wendy’s overall performance is price discounting. Wendy’s has avoided discounting, preferring instead to push its value menu and various meal combinations.

Wendy’s has always differentiated its brand based on quality. Ever since Dave Thomas started the Company in 1969, its hamburgers have been made with the freshest ingredients and served the way they want them. To Dave, quality was so important that he made “Quality is our recipe” part of the logo.

The replacement campaign that features “combo choices” is more tactical than strategic. It focuses on the here and now but does little to build its image and distinguish it from competitors. It is also very easy for Burger King and Harvey’s to duplicate.

Some industry observers claim Wendy’s current advertising problems stem from the curse of Dave Thomas. When Dave was the central spokesperson in ad campaigns, Wendy’s was “on a roll.” The public liked his warm smile and folksy, down-home image. Since Dave’s passing in 2002, Wendy’s hasn’t had much of an image. Due to product advances by competitors, Wendy’s is now in a position where its quality differentiation is no longer meaningful, and its advertising is ineffective. An overhaul of Wendy’s marketing strategy is needed since the problem seems to go beyond advertising.

Wendy’s must identify a direction that will reposition the brand in the longer term. Executive vice-president Don Calhoun believes that any new advertising campaign should prominently position Wendy’s food and its “quality” heritage. In past advertising campaigns, the essence of Wendy’s positioning strategy was expressed by the slogan “It’s better here.” While that slogan does represent the Wendy’s of the past, Calhoun must consider how rapidly the marketplace is changing. Since competitors have caught up in terms of product choice and quality, Wendy’s now needs a new strategy that will have a greater impact on consumers.

Market Share

Depending on how the quick-serve restaurant market is segmented, Wendy’s market share can be expressed in several ways. Among hamburger chains in Canada, McDonald’s is the clear leader with a 50-percent market share. Both A&W and Wendy’s are tied for second, at 12-percent market share (2003). The revival of the Papa Burger and other menu items from the past has helped rejuvenate A&W in Canada. Burger King follows with about 10-percent market share.

Not considered in these market share figures are competitors in other segments of the quick-serve restaurant market. In this category are chains such as Cara Operations (Swiss Chalet and Harvey’s), Tricon Global (KFC, Pizza Hut, and Taco Bell), and Subway, all of which have more market share than Wendy’s. If these chains are included, Wendy’s share of the market drops to about 5.5 percent of the overall market.

Currently, Wendy’s is rated highly as a popular place to get fast food. Generally speaking, Wendy’s was first to offer healthier food items, which were particularly popular with female customers. One-quarter of Canadians (26 percent) list McDonald’s as the place they frequent most often for a fast-food “fix”, followed by Wendy’s at 12 percent and Subway at 10 percent. Canadians consider Wendy’s and Subway to be the healthiest quick-serve restaurants.

Media Spending and Allocations


McDonald’s currently dominates the quick-serve category with annual media spending (measured media) of about $600 million in the United States. Wendy’s follows with expenditures of about $300 million (estimates for 2004). Wendy’s is a very traditional advertiser, with most of its expenditures in television advertising. In the United States Wendy’s advertising budget is allocated as follows (2001 figures):

$ Allocation (000) %
Magazine 3 200 1.3
Outdoor 6 500 2.7
Internet/ TV 105 000 44.2


In order to maintain Wendy’s position in this competitive market, it is important for Wendy’s senior management to ensure that its customers – the managers and decision-makers, are satisfied with their ‘offerings’/products. Therefore, Wendy’s marketing department has conducted a survey-based study on its customers. It will provide data on how Wendy’s and its competitors are perceived by customers.

The survey questions follow, and the data file is stored on the Blackboard site for 7MARK018w Semester 1, as “Wendy’s Data Recoded.sav “. Wendy’s management team can use the results of the survey and its analysis to make strategic decisions to improve the Company’s standing in the eyes of its customers.


The Task


Please write a memo, of no more than 1,500 words, to Wendy’s management team addressing the following issues:

NOTE: Once you have built the model to predict consumption of burgers, include a section in your Memo to include a short discussion on the merits of the business analytic model in the current climate (Covid-19).

Sample Solution





Subject: Wendy’s Restaurant Managerial Data Analytics for Marketing


Situation Assessment and Recommendation

The restaurant industry continues to become complex. The current business world has become very competitive. With the advancement of technology and internationalization, businesses have to understand consumer behavior. Wendy’s Company has shown weaknesses in the way they operate. Despite the Company having franchises across the world, it will not be competitive without accurate information. From the analysis, the Company is in a competitive edge that needs careful review. Competitors have managed to achieve a competitive menu parity. However, it has managed to claim its “healthiest” hamburger title in the last 18 months. Additionally, after Mcdonald’s and Burger King upgraded the produces and salads, it will not be an easy ride for Wendy Company.

Wendy Company has to consider methods of retaining customers. Some of the options it has been to; a) review its discounting policy, b) push menu and meal combinations, c) improve overall performance, and d) improve advertising methods. Despite the Company having a considerable market share, competitors have caught up with it. Therefore, a new strategy will have to be developed to retain its market share and increase it. To come up with the right plan, the Company should consider using data-driven decision-making. According to the analysis of the problem statement, improving the quality of the recipe is your main agenda. It is also expected to be included in the company menu. Lastly, the Company’s campaign “combo choices” is not strategic since it does not distinguish it from competitors.

With big data and data analysis tools, businesses can now process large sums of data. Mehta, Saxena, & Purohit (2020) defines a consumer as a person who desires or needs to purchase a product. The research also identifies the internal and external factors that form consumer behavior. The consumer behavior concept is an essential constant decision-making process for businesses. Wendy’s Company needs to identify consumer processes in searching, evaluating, purchasing, and consuming products. They need to identify consumer behavior based on social issues, individual factors, and satisfaction. It should also research what satisfies consumers and how to maximize their utility.

Rationale for recommendation

Customer Analysis Based on Demographics and Psychographic Profiles

The research analyzed Demographics in detail to understand the type of customers that use Wendy’s products. Respondents were categorized in terms of age and gender. Demographics categorization will determine social, personal, and psychological strategies to be used in marketing.

The study tried to understand the demographics of respondents based on age. Age is a significant influencer of consumer behavior. It influences social, economic, personal, psychological, and marketing mix to be used. The majority of customers buying Wendy Company’s products were found to be aged between 18 to 24 years, with 39.7%. The research observed the least consumers are those aged between 35 and 39 with 12.4%.

Gender is another important factor that determines consumer behavior. The majority of customers were women. 55.9% of the respondents were female, while men recorded 44.1%. Thus, gender is a significant factor that affects consumer purchasing behavior (Lakshmi, Niharika, & Lahari, 2017). According to the research, female consumers need different products. Thus, Wendy’s Company should understand that men and women consumers have other likes when purchasing products (Pawar, 2019).

To understand consumer demographics, we will conduct a descriptive analysis of the provided data. The investigation began by understanding the demographics of respondents. According to Gaile-Sarkane (2016), demographics are an essential part of understanding consumer behavior. It is based on research from individual behavior and psychology. The Company needs to know how customers make purchase decisions according to motivation, perspective, learning, personality, and attitude to understand why a customer is likely to purchase a product. The analysis will also seek to understand situational factors, stimulus, and systemic effects. It will seek to understand how communication, usage situation, and communication situation.

2. Building a Model for Nutritional Content Rate to Wendy

Correlation and linear regression analysis were used to find the relationship between variables. Wendy’s Company needs to understand factors that affect consumer behavior. The research will seek to find out what factors are leading customers to buy from competitors. Regression analysis will predict the consumption of burgers.

Linear Regression for Wendy’s

Y= β0+ βX1+ βX2 +e


Β0 is Y the intercept

Β1 is the slope coefficient

E is a random error

Y is Times visited a fast-food restaurant

X1 is Wendy’s rating

X2 I consider the amount of fat in the food

The regression analysis showed a low relationship between the number of dependents, reading nutritional labels, and income level. The R square was low (r2= 0.014), indicating the a low effect of independent variables over the dependent variable. The ANOVA analysis confirmed that there was no statistical significance between the variables. The significance level was more than the set significance level of <0.05, indicating no relationship.

3. Correlation Analysis for Wendy’s

We conducted correlation analysis to find relationships between variables. Variables selected included income, education level, product composition, behavior about fast food, frequency of buying fast food, the nutritional value of the product, and attitude towards the Company. The analysis showed a negative relationship between what clients read from the product labels and company ratings (corr = -0.022). The 2-tailed significance level also showed no statistical significance between the two variables (sig. 0.505). The analysis obtained similar results on the level of education and company reputation (corr =-0.022 and significance of 0.274). Additionally, income and education levels did not affect the frequency of purchasing products from fast foods. However, there was a statistical significance between the level of education and customers reading labels on products they bought (P-value was 0.000, which is <0.05).

Table 1: Correlation

Through analysis of provided data, the Company will be able to analyze main changes in consumer behavior. The research will also link data to factors such as Covid-19 and the subsequent lockdown period. The study will link findings to literature to find the reasons for behavior change.

Covid-19 pandemics has highly affected businesses across the globe. According to Fareed & Overvest (2021), the Covid-19 crisis is likely to affect future productivity through changes in business dynamics. Companies that will survive the impact are only those that will change fast. The spread of Covid-19 led to hindering of social interactions, leading to numerous lockdowns. These affected the economic behavior of individuals. Governments resorted to sizable support instruments such as tax deferrals, wage subsidies, and loan guarantees to help businesses stay afloat. However, lockdown measures can affect business dynamics for both new and existing businesses. Doblin (2021) identified changes in the fast-food industry over time. The success of Wendy’s Company depends on understanding consumer behavior. The global food industry has changed over the years due to consumer behavior. Global vendors have successfully reached new clients through quick international expansion, improvements in the dining experience, and product innovations.

By the end of 2019, many individuals were avoiding fast foods to maintain careful measures. Furthermore, the novel coronavirus affected operations of the food and beverages industry and supply chain. Wendy Company was no different. It is now required to provide consumers with fresh, appealing, and tasty foods. This indicates that wendy should increase its efficiency. According to Doblin (2021), Wendy should maintain healthy, natural ingredients and quick service to maintain clients.

Observers have brought forth that Wendy’s main problem is advertising problems. Despite the Company working hard to have quality differentials, it is no longer meaningful. The advertising method is ineffective. Thus, the Company has to develop long-term strategies to improve customer experience. According to Barmola & Srivastava (2018), businesses have an extensive effort to understand human behavior concerning purchasing. It has become an essential task for management to understand what customers want at a given time. Businesses have identified the importance of understanding the psychological part of an individual when purchasing different goods and services.

According to the analysis, the Company needs to target women clients. The marketing strategy to be implemented should not only focus on packaging. The research showed no relationship between nutritional labels and purchasing behavior. The marketing strategy being used by the Company might no longer be effective according to age demographics. The majority of customers were young. Thus, print and tv adverts will no longer be effective. The age bracket in question spends the majority of its time on mobile phones. To compete with a significant company as Mcdonald’s, they have to invest in media marketing. Wendy’s seem to have overinvested in TV and internet with a 44.2% while magazine and outdoor getting 1.3% and 2.7% respectively.

Lastly, customers did not show significant concerns about the nutritional value of products. Wendy Company thus can continue focusing on the taste of products. However, it should not compromise the quality of the recipe. Th” tactic of “c” mbo choices” will be appropriate for the competitor to distinguish it from competitors.