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December 21, 2011 3:59 am
The battle for second place in the US hamburger chain wars is heating up. Burger King, which for years staked its fortunes on male-centric advertising filled with sexual innuendo, has left an opening for Wendy’s to overtake it as the chief rival to McDonald’s.
With burger consumers increasingly demanding about taste and quality, Wendy’s is poised to pass Burger King in market share sometime next year, according to Mark Kalinowski, restaurant analyst at Janney Capital Markets. It would be the first time that Wendy’s, which was founded in 1969, has overtaken Burger King.
Burger King, which once held about 20 per cent of the $65bn hamburger market, fell to 13.3 per cent last year and could soon dip below 10 per cent, he wrote in a recent research note.
“We view the Burger King brand as troubled – a brand that needs to find its voice in the domestic market,” Mr Kalinowski said. “To us, flame-broiling and ‘Have it your way’ are not nearly enough to connect with many of today’s sophisticated burger-sector consumers.”
Wendy’s, meanwhile, has focused on taste and heritage, offering thicker burgers with buttered buns while reminding customers of its glory days with a remake of its 1984 “Where’s the beef?” commercials.
“Wendy’s is gaining at Burger King’s expense,” said Kevin Horne, a marketing consultant who suggests that the chain should replace “Wendy” as a mascot in favour of “Dave”, the chain’s founder.
Top US fast-food chains have faced increasing competition from “better burger” chains that have been eating into market share with their premium meat and high-quality toppings.
Analysts argue that while McDonald’s has aggressively reworked its restaurants’ image and Wendy’s is staging its own remodelling, Burger King has been too slow to improve the quality of its food or facilities.
Burger King’s stumbles have coincided with a reshuffling of the company’s critical advertising account.
Until earlier this year, Burger King employed Crispin Porter + Bogusky, an independent agency known for its unconventional work, in a bid to attract young men who frequent fast food restaurants.
“There was a very close mix between the edgy style of that agency and the overall strategic position Burger King wanted to take,” said Bradford Hudson, a marketing professor at Boston University.
CP+B’s work for Burger King included a hamburger-scented cologne called “Flame”; a popular but disturbing character named “the King”; and the “Whopper Sacrifice”, a Facebook application that gave users a free hamburger if they removed 10 friends from their social network.
But CP+B’s innovative work for Burger King obscured problems with the chain’s product. “The entry point for being excited about the brand was the ads, not the food,” said Mr Hudson.
Now, as Burger King’s new owner, 3G Capital, tries to revive the Burger King brand it has decided to adjust its marketing strategy.
CP+B was dropped in favour of Mcgarrybowen, a small New York agency run by industry veterans, and last August, Burger King unveiled a “food-centric” approach to marketing that it said would showcase its high-quality ingredients.
CP+B, Mcgarrybowen and Burger King all declined to comment.
The value of Burger King’s creative account is $300m and the new ads focus on the food itself, with television advertising touting “new” french fries and featuring hamburgers served on “artisan-style” buns.
“Sometimes the agency leads the strategy, and sometimes it follows it,” said Mr Hudson. “CP+B was leading the strategy, and the new firm is following the company.”
But it will take more than advertising to reverse Burger King’s declining fortunes, according to Jeff Greenhouse, president of 201 Proof, a marketing consultancy.
“People are looking for better food now, and ultimately the food is what’s going to get people coming back,” Mr Greenhouse said.
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