Wendy’s is the world’s third largest fast food company founded by Dave Thomas. The major competition to Wendy’s comes from McDonald’s, Yum and Burger King. The company’s key strengths are its strong market position, its increasing profitability and differentiated product offerings. The key opportunities that lie ahead of this company are: a scope of establishing new restaurants, the rise of the industry in the US and its image as a innovator of health food. The company is perceived as a company which serves fresh, healthier, fast and delicious food.
The company has been improving significantly over a period of time. The company recently had a change in leadership and the new team is focusing on recovering the lost market share. Steps have been taken in this direction; these steps have started showing results as well. The same store sales have gone up. But the company has to take care of some weaknesses as well. These weaknesses are its performance in the US and weak returns. The company also faces some threats from competition, rising cost of raw materials and increased health consciousness.
The company initially started as a cost leader but after the competition adopted the same idea the company has been using a different positioning strategy. When the competition started fighting over price Wendy’s took a different role by positioning its products as premium products and it’s advertising focused on the desirability of the product. Positioning Map HIGH LOW • Burger King • Wendy’s • McDonald’s • Hardees Burger King and Wendy’s have the same positioning strategy of home like food with better preparation quality. Target market
With the stated positioning strategy the target segment should be: TM1: DINKs (Double Income No Kids) Generally both earning members are very busy shaping up their careers. They often eat out. This choice of eating out is not for leisure or entertainment but due to lack of time. Such people would be happy to get some like home like food with good preparation quality TM2: Family with small kids Family is conscious of what their kids eat and kids are more curious about the toy (especially kids under the age of 10 years) they get with the meals.
So this segment would have Wendy’s as a natural choice. TM3: Adult Singles Adult Singles who are not staying with their families yearn to have some home like food. This segment can be a lucrative target segment for Wendy’s TM4: Night Market Another target segment is the diners i. e. people who come out to eat after 8. 00 P. M. The company has deliberately kept out of the breakfast business since 1980s. The focus on night business is more relevant because it doesn’t require any special training for the staff and the product line is also the same.