Bigger Burgers. Bigger Sales.

Last November, Hardee’s introduced the MONSTER THICKBURGER. While the 1,418 calorically-dense burger and its 107 grams of fat may not be healthy, sales at Hardee’s sure are healthy.

According to a recent Wall Street Journal article, “Burger sales at the roughly 2,050 Hardee's outlets have climbed 20% since the 2003 introduction of the first Thickburgers. CKE (owner of Hardee’s) has posted 19 consecutive months of same-store sales growth, after years of the opposite.” And the company’s stock price has zoomed to near $15.00 a share, up from a low of $3.69 two years ago.

I found the story of how Hardee's edgecrafted its way to sales success quite remarkable. Below is an excerpted abstract of the article ...

The order sounded like heresy to Bruce Frazer, chief architect of hamburgers for the Hardee's fast-food chain. While Hardee's rivals were making menus leaner and greener, Mr. Frazer's boss ordered him to build a "bigger, better burger."

First, Mr. Frazer delivered the Thickburger, topping out at two-thirds of a pound of Angus beef. Good, his boss said, now make an even bigger one. In November, Hardee's unveiled Mr. Frazer's Monster Thickburger: a pair of 5.7-ounce patties, four strips of bacon and three slices of American cheese on a buttered sesame-seed bun slathered with mayonnaise. It weighed in at 1,418 calories -- 600 calories more than Burger KingCorp.'s Whopper with cheese, or the equivalent of more than two of McDonald's Corp.'s Big Macs.

Consumers have long told fast-food chains that they want burgers with mayonnaise, but many chains eschew mayo because it is expensive. Mr. Frazer went with it anyway. Working with a development team in the Hardee's test kitchen, he increased the thickness of dill pickles on the sandwich and switched to a tastier, more-expensive American cheese.

The designers considered using a single thick tomato slice, but "it was just too tomatoey," Mr. Frazer says, so they settled on two thinner slices. Four slices of bacon overpowered the original Thickburger, so three were used, although the Monster Thickburger was big enough to handle four. Bigger burgers required a firmer bun, which required more dough -- at still more cost. Mr. Puzder wanted butter on the buns, so Hardee's commissioned the creation of a "butter wheel" that the bun's bottom is rolled over before it's popped onto a grill. Finally, Hardee's made franchisees pay for $7,000 grills with bigger flames that reduce cooking time and give burgers a "char flavor," Mr. Frazer says.

"The costs were pretty heavy [but] we had to do something," says Bill Boddie, chief executive of Boddie-Noell Enterprises Inc., the Rocky Mount, N.C., franchisee of about 320 Hardee's units. His sales had fallen throughout the late 1990s, he says, but are now climbing again.

Hardee's then splurged on advertising that cost $55 million last year. All the spending showed up in the price that Hardee's recommends franchisees charge for a Monster Thickburger: $5.49. By comparison, the most-expensive McDonald's sandwich, the Double Quarter-Pounder with cheese, is $3.60 in the Chicago area, while Burger King's Angus Bacon and Cheese sandwich runs just over $4.

The high price has helped boost the average guest check at Hardee's by 5% to $4.58 in the past year. Annual average sales per restaurant have risen nearly 19%, from a low of $716,000 in fiscal 2001 to $850,000 in the third quarter of fiscal 2005, but are still below the $1 million industry average.

As Hardee's had hoped, Thickburgers have done especially well with men aged 18 to 34 years old. Recently, at a Hardee's in Niles, Mich., a working-class town, Ben Townsend, 27, bit into a Bacon Double Cheese Thickburger -- all 1,300 gooey calories of it, plus fries. Was he worried it might endanger his health? "I've never even thought about it," said Mr. Townsend, who builds homes. "And to be honest, I don't really care. It just tastes good."

[SOURCE: Wall Street Journal (article)| Thursday, January 27, 2005 | subscription required]

Comments

[Diego from metacool]

This is what Krispy Kreme should have done last year instead of coming out with a line of drinks -- if you are selling excess, top your line with wretched excess.

[john winsor]

Yikes! And we wonder why obesity is such a problem in America. One interesting effect is that the increase in obesity does fuel the diet industry.

[johnmoore (from Brand Autopsy)]

Yeah … the greater the indulgence, the bigger price we consumers pay literally and ‘figuratively.’

Ya know, Starbucks also taps into the indulgence factor to drive sales. Nearly every promotional beverage they introduce is of the indulgent variety and the added indulgence will usually cost consumers anywhere from a quarter to fifty cents more. Be it a Gingerbread Latte or a Pumpkin Spice Frappuccino, Starbucks will usually charge more for the beverage.

Before the price increase last Fall, adding indulgent beverages to the menu was the only sure fire way to increase the average check at Starbucks. Every retail marketing promotion I helped develop/implement always included a new pricier and more indulgent beverage launch.

[Peter Davidson]

While it is true that America has a serious obesity problem there are a substantial number of people who can eat indulgent foodstuffs without ill effects on their health. This is what makes America great. Companies are free to make the products they want to make if they feel they can sell them. It's up to individuals if they wish to purchase them. No one is making people eat these things.

[Patrick]

Plus, the more they eat of these burgers the sooner they die. It's like smokers--do I care that they smoke? Not really, I've yet to find a smoker whose company I enjoyed.

Seriously, this "success" doesn't change the fact that it's still Hardee's. Does anyone want to admit to eating there?

[Aleah]

Talk about weapons of mass destruction!

Seriously though, if an adult is drawn in to eating these bad boys every day, so be it. But I worry about youth who have the option of off schoolgrounds dining (sans parents) and how their health would be affected.

[Steven Streight aka Vaspers the Grate]

Hardees? The name is stupid, the food sucks, the television commercials reek of sexual depravity and vulgar hedonistic insanity, and the marketing strategy is equal parts sadism and idiocy.

Who needs terrorist attacks like 9-11, when we've got the dietary terrorism of Hardees?

I love this blog, but I sincerely oppose everyone at Hardees and I feel sorry for people who dine there.

I wish the government would at least force junk food pushers to distribute literature on heart health, cholesterol, exercise, and dieting.

Increased sales? Last I heard, methamphetamine sales were skyrocketing too. So what's that to rejoice about?

Vasperously yours,

Vaspers the GRATE