Fast-food chains have to walk the tightrope between value and profitability. Subway, for example, had to pull away from its famed "$5 Footlong" promotion because it drove sales that weren't profitable.
Ideally, customers would buy a regular meal and use the Dollar Menu to add to it, increasing their checks slightly and their satisfaction.
The chain might not make more money on the higher check value, but the customer has a better experience, finds their meal a better value, and likely comes back more often.
If, however, customers pick and choose the deals they want ordering only loss leader items from deal menus, then the fast-food chain adds unprofitable sales (which makes franchisees angry).
McDonald's has fought that with a variety of offers currently offering a Value Menu called $1 $2 $3 Dollar Menu. Rival Burger King, a Restaurant Brands International (QSR) - Get Free Report, has tried similar things as well as offering a variety of bundled value deals.
That's a way to still show a value proposition to customers while being able to offer different price points.
Wendy's has also been clever about how it offers discounts using its Four for $4 meal deal as its prIme discount offering and sometimes cycling in other offers.
Now, it has brought back a popular deal and made it better.
Wendy's Goes Biggie
Wendy's has sometimes gone even bigger than its Four for $4, which includes a Jr. Cheeseburger, a four-piece chicken nuggets (crispy or spicy), a Jr. Fry, and a value drink.
On occasion, it offers the $5 Biggie Bag, which includes "a Jr. Bacon Cheeseburger, a Double Stack, or a Crispy Chicken BLT to go with your 4 PC. Nugg, small fry, and small drink."
Yes, Wendy's calls its nuggets "Nuggs," but that's not the exciting thing here for fans of the chain.
This version of the Biggie Bag comes with a choice of sandwich when the previous incarnation only offered the Bacon Double Stack.
It's a small change, but an added level of choice that should make the $5 Biggie Bag an option for more of its customers.
You can purchase a $5 Biggie Bag online, via the Wendy’s mobile app, or in-restaurant at participating locations nationwide for a limited time.
"As an added bonus, from April 12 to April 24, 2022 fans get 3x Bonus Rewards points on all Wendy’s Biggie Bag purchases," Chewboom reported.
Digital Has Been a Source of Wendy's Growth
Offering incentives to order via the app has been a key part of Wendy's strategy so it makes sense that the company would do the same with the $5 Biggie Bag.
CEO Todd Penegor shared some insight into the company's digital growth during its fourth-quarter earnings call.
"We saw significant growth in our digital business across the globe in the fourth quarter, reaching approximately 10% of sales globally and exiting the year with a ton of momentum.
"Our international digital sales mix exceeded 15%, up versus the third quarter as Canada saw significant gains from the addition of Uber Eats as a delivery provider," he said.
The United States saw an acceleration in digital sales as well moving to 9% of the mix in December.
"This growth was driven by gains across both mobile ordering and delivery. We also saw meaningful increases to our loyalty program, growing total members by approximately 75% over the course of the year and growing monthly active users by approximately 25%," he added.
In 2022, Penegor said he expects breakfast to be a major sales driver, but also highlighted the role of promotions including the $5 Biggie Bag.
"We've got a lot of strong messaging on breakfast that halos back to the rest of the day with the high-quality messaging. We continue to have a nice steady dose of news around Made to Crave.
"We've had activity around Four for $4 and $5 Biggie Bags. So we do have a lot to offer in the spirit of high quality and affordable price relative to not just the QSR competitive set, but all the restaurant competitive set," he said.