Wendy's Next Generation Kitchen at the Hilliard, Ohio location / Wendy's Wendy's Next Generation Kitchen at the Hilliard, Ohio location / Wendy's

Wendy’s Commits an Extra $25 Million to Digital Initiatives This Year

In closing out fiscal 2018, Wendy’s knows that it needs to do better. Annual comparable store sales growth was the slowest its been in the past six years, down to a 0.9 percent gain for the full year, and global systemwide sales growth was down a full percentage point from the previous year.

What’s going to fix Wendy’s issues? Leaning harder into digital investments, according to the company.

In order to do that, Wendy’s hired a new chief digital officer, Laura Titas, who will report to chief concept and marketing officer Kurt Kane. She’ll be responsible for heading up the company’s digital initiatives, from overseeing delivery integration to online ordering and mobile app experience.

To show how serious the company is about its digital future, Wendy’s committed an extra $25 million to invest in the chain’s various digital programs this year.

“At the end of the day, what we really want to do is create a better connection to our consumer and gather the data and have a one-to-one connection with everything that we’re doing,” Wendy’s CEO Todd Penegor said on the company’s fourth quarter earnings call on Thursday. “We’ve got a lot of tools out but we want to go even faster.”

Doubling Down on Digital

Delivery is currently operational in 60 percent of the Wendy’s system through the company’s partnership with DoorDash in the U.S. and Skip the Dishes in Canada, and leadership projects that the integration will reach 80 percent of stores by the end of 2019.

Mobile ordering and payment processing will be another area of focus this year, Penegor noted. Enabling digital scanning technology for in-store diners to be able to quickly use coupons and take advantage of promotions available on the Wendy’s app will better drive digital sales.

Given the reports of franchisee unrest at other chain competitors while each restaurant brand in the industry undergoes their own version of digital transformation, the company reiterated that this strategy will firmly support profitability at the franchisee level.

“We know the common threat across the whole system is the restaurant economic model,” Penegor said on the call. “And if it’s working for them, it’s going to be working for the company, and that’s why we’re going to great lengths to continue to drive strong, profitable sales growth for the system.”

Wendy’s shares were trading up 0.85 percent immediately following the call.

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