This week Wendy’s announced it has expanded third-party delivery options in North America in what’s clearly a move to better compete with McDonald’s and other fast-food restaurants as consumers demand more and more delivery.
Among other announcements during the company’s latest earnings call, Wendy’s CEO Todd A. Penegor noted that roughly 40 percent of the company’s restaurants in the U.S. and Canada now offer delivery, up from 25 percent at the end of the first quarter.
“The consumer has an appetite for convenience and we have seen this through our delivery economics,” he said, adding that check sizes have been “1.5 to 2 times higher on delivery orders.”
On the call, Wendy’s also reiterated its commitment to technology, including its new Digital Experience organization, which works on leadership changes, agile software development, and, of course, further developing the company’s mobile strategy. Current CIO David Trimm will retire in early 2019, which Wendy’s says will provide a chance to “refocus [their] leadership structure” to leverage more tech.
Wendy’s kickstarted delivery services at the end of 2017 by partnering with DoorDash in the U.S. and SkipTheDishes in Canada. On the aforementioned post-quarter earnings call, Wendy’s also reported that delivery is the number one area of business in terms of customer satisfaction. That’s huge, considering fast food isn’t inherently designed (cooked?) for travel, and a lot of fast food chains still struggle to keep food high-quality.
Take McDonald’s. The daddy of all fast food chains expanded its Uber Eats-powered delivery operations to about 5,000 stores in the U.S. in less than two years. They may be the most aggressive in terms of expansion right now (Wendy’s currently operates about 2,500 locations with delivery), but food quality remains an issue, most notably with soggy fries.
Not to be forgotten, Burger King is also ramping up efforts in both digital and delivery. While BK has experimented with delivery in the past, the company has been slower than its competitors to adopt it on a large scale. Even so, there are some who approve of BK’s slower ramp up, noting that a steady speed can “show what some of the potential pitfalls are.” Said pitfalls include losing some control of one’s brand to third-party services, as well as the food quality issue.
Delivery still represents only about 3 percent of all restaurant orders, fast food or otherwise. Most days it seems like more, given all the news we read about the market. But it’s still hard to tell if this trend towards getting fast food delivered to your home is a fad or an actual long-term strategy. For now, the question seems more about who can strike the best balance of timing, quality, and strategy to, erm, deliver what customers want most.
