Marketing and Advertising Objectives

Marketing and Advertising Objectives

• Marketing and Advertising Objectives

• Sonic Drive-In would like to expand franchises into the upper Mid West and North West regions of the United States. The Sonic franchise is well known in the American South East and we feel there is an opportunity to expand to these states.
• We plan on having Sonic capture at least 20% of the market in these regions and raise between 15 – 40% brand awareness with the target market.

• Target Audience

• Men between the ages of 18 – 50 that are up late at night looking for a quick meal or a snack are an ideal target for Sonic’s menu and drive-in style.

Scheduling Strategy and Media Mix

• Scheduling Strategy and Media Mix

• We want to begin priming with increased advertising in the spring season which will eventually lead to peak advertising in the summer months (June, July, August). The advertising will be a mixture of Television, Outdoor (Billboard), Online (Social Media), and Radio

Background Information

• Background Information

• - Sonic Corp. operates and franchises the largest chain of drive-in restaurants (“Sonic Drive-Ins”) in the United States.

• The Sonic Drive-In restaurant chain was begun in the early 1950’s. Sonic Corp. was incorporated in the State of Delaware in 1990 in connection with its 1991 public offering of common stock.

At a standard Sonic Drive-In restaurant, a customer drives into one of 20 to 36 covered drive-in spaces, orders through an intercom speaker system, and has the food delivered by a carhop. Many Sonic Drive-Ins also include a drive-thru lane and patio seating.

• At a standard Sonic Drive-In restaurant, a customer drives into one of 20 to 36 covered drive-in spaces, orders through an intercom speaker system, and has the food delivered by a carhop. Many Sonic Drive-Ins also include a drive-thru lane and patio seating.

• Sonic Drive-Ins feature Sonic signature items, such as specialty drinks including cherry limeades, slushes, frozen desserts, made-to-order sandwiches, hamburgers, extra-long cheese coneys, hand-battered onion rings, tater tots, salads, and wraps. Sonic Drive-Ins also offer breakfast items and Drive-Ins serve the full menu all day.

Sonic competes in the restaurant “quick serve” industry, a highly competitive industry in terms of price, service, location, and food quality. The restaurant industry is often affected by changes in consumer trends, economic conditions, demographics, traffic patterns, and concerns about the nutritional content of quick-service foods. Sonic competes on the basis of speed and quality of service, method of food preparation (made-to-order), food quality and variety, signature food items, and monthly promotions.

• Sonic competes in the restaurant “quick serve” industry, a highly competitive industry in terms of price, service, location, and food quality. The restaurant industry is often affected by changes in consumer trends, economic conditions, demographics, traffic patterns, and concerns about the nutritional content of quick-service foods. Sonic competes on the basis of speed and quality of service, method of food preparation (made-to-order), food quality and variety, signature food items, and monthly promotions.

• The quality of service, featuring Sonic carhops, constitutes one of our primary marketable points of difference from the competition. There are many well-established competitors with substantially greater financial and other resources. These competitors include a large number of national, regional, and local food services, including quick-service restaurants and casual dining restaurants.

Competitive Store Counts

• Competitive Store Counts

• 1. McDonalds 14,000

• 2. Burger King 7,760

• 3. Wendy’s 6,576

• 4. Dairy Queen 5,050

• 5. Sonic 3,572

• 6. Jack in the Box 2,100

• 7. Hardees 1,687

• 8. Carl’s Jr. 1,104

• 9. Checkers 800

• 10. Five Guys 735

• http://eaters.com/authors/raphael-byron

Qualitative:

• Qualitative:

• - Sonics' current market plan includes promotions throughout the Sonic chain, through TV, radio, and interactive media promotions, generally center on new limited time products and signature items.

• Competitors

• McDonalds- image and slogans (I’m Lovin It), products, dollar menu

• Burger King- Image, mascot, slogan (Have it Your Way), product

Sonic total spending in 2011- $ 136,584,800

• Sonic total spending in 2011- $ 136,584,800

• -

• Network TV- $14,016,100, SOV= 1.3%

• Spot TV- $63,639,300, SOV= 5.9%

• SLN TV- $13,269,200, SOV= 6.1%

• Cable TV- $34,180,700, SOV = 3.7%

• Newspaper- $38,100, SOV= 0.4%

• Local Radio- $4,023,900, SOV= 2.0%

• Outdoor- $3,821,800, SOV=2.3%

Demographics

• Demographics

• -Age 18-54

• -Working men and women

• -college educated

• Lifestyles

• -HHI $45,000 or more

• -1-4 children in family

• -homeowners

• Media Usage

• -lighter TV viewers

• -heavy magazine readers

• -light newspaper readers

• -heavy internet users

Seasonal- Results show during Sonics' second fiscal quarter (the months of December, January and February) sales generally are lower than other quarters because of the lower temperatures in the locations of a number of Partner Drive-Ins and Franchise Drive-Ins, which tends to reduce customer visits to our drive-ins.

• Seasonal- Results show during Sonics' second fiscal quarter (the months of December, January and February) sales generally are lower than other quarters because of the lower temperatures in the locations of a number of Partner Drive-Ins and Franchise Drive-Ins, which tends to reduce customer visits to our drive-ins.

Geography

• Geography

• In terms of geographical factors, Sonic’s growth appeared to be determined by the economy, and due to recent troubles with the economy Sonic’s growth has started to slow. Choosing the right place would first have to be looking at the overall income of the area.

• It is shown that Sonic has higher index numbers in places where people are making at least $45,000 dollars a year, so when picking a place there should be a focus on areas with an income near or higher than that. It also seems that index numbers for Sonic are higher in areas with families with anywhere to 1-4 children, after that the numbers start to drop. By focusing more on areas with families who have at least 1-4 children and are living in the middle class or higher would be more beneficial when deciding where to spend advertising dollars and place new stores in the North.

Strengths

• Strengths

• Sonic Corporation operates and franchises the largest chain of drive-in restaurants in the United States.

• One of the only drive-ins to feature “car hops” which generally deliver food to cars on roller skates.

• Large and wide ranging menu, anything from burgers to breakfast and desserts.

• The full menu is available all day long.

• Customer loyalty is among the strongest in the food industry.

• One of the fastest growing and most successful franchises in the nation.

• Operations running from coast to coast, totaling in 3,572 locations.

• Franchisees are a vital part of the continued growth of the company.

• Quality of Service separates Sonic from the competition.

• Sonic is number 5 in the total of competitive store counts in the United States.

Weaknesses

• Weaknesses

• Sonic experiences difficulty with sales in the winter months, especially in Northern locations. Other fast food locations that do not have drive-in style service generally experience a better turn out for obvious reasons relating to the weather.

• Sonic is a “burger and dog” restaurant which puts them against traditionally stronger competitors such as McDonald’s, Burger King, and Wendy’s.

• Sonic does not boast nearly as many store locations as the above mentioned fast food giants and must drive its profits by playing up their distinct method of drive-in service.

• Sonic faces competition against other fast-food establishments that provide more diverse menu choices, such as pizza and health food options.

Opportunities

• Opportunities

• Health food menu options are something that Sonic has yet to fully exploit and it may help raise brand awareness.

• Due to low sales during the winter months, Sonic can attempt to position itself with more winter friendly products such as hot beverages.

• The South is already a strong region for Sonic, we can continue to build on this.

• Many Northern regions are not familiar with the Sonic franchise but there are many opportunities to expand and promote drive-in style fast food.

Threats

• Threats

• Lack of brand awareness compared to competition such as Wendy’s, McDonalds, Burger King.

• People looking for healthier food options may not want to purchase from Sonic.

• Seasonal factors affect the point of having a drive-in style restaurant.

• Low entry barriers.

Capture 20% market share in new regions of North-Northwest.

• Capture 20% market share in new regions of North-Northwest.

• States include; Washington, Oregon, Northern Idaho, Wisconsin, North and South Dakota, Minnesota, Michigan.

Distinguish Sonic from competition, primarily drive in, fast food chains and to increase brand awareness from 15% to 40% among adults 18-52.

• Distinguish Sonic from competition, primarily drive in, fast food chains and to increase brand awareness from 15% to 40% among adults 18-52.

Target audience is fast food eaters looking for a change of pace from the traditional drive-thru. The Sonic Drive-in experience is for consumers who want a more comfortable pace and a diverse menu ranging from snacks to meals to desserts.

• Target audience is fast food eaters looking for a change of pace from the traditional drive-thru. The Sonic Drive-in experience is for consumers who want a more comfortable pace and a diverse menu ranging from snacks to meals to desserts.

Target audience will be in the age range from 18-52

• Target audience will be in the age range from 18-52

• Focusing on audience with income range of $40,000 and higher (2011 Gfk MRI Doublebase)

Sonic Drive-In wants to give it’s customers a convenient, personalized experience that has the feel of a classic American drive-in while offering a diverse menu of snacks and other delicious treats.

• Sonic Drive-In wants to give it’s customers a convenient, personalized experience that has the feel of a classic American drive-in while offering a diverse menu of snacks and other delicious treats.

• Sonic is, “America’s Drive-In”

Sonic Drive-In provides a one of a kind fast food experience to the consumer. We are the largest chain of drive-in restaurants in the United States and we take pride in providing a unique menu with intimate car-hop service.

• Sonic Drive-In provides a one of a kind fast food experience to the consumer. We are the largest chain of drive-in restaurants in the United States and we take pride in providing a unique menu with intimate car-hop service.

Style of service

• Style of service

• Restaurant treatment for fast food prices

• Convenience

Achieve 40% reach of target audience of adults 18-52 and frequency of 4.2.

• Achieve 40% reach of target audience of adults 18-52 and frequency of 4.2.

Established brand? Yes +.1

• Established brand? Yes +.1

• High Market Share? +.1

• Dominant Brand? -.1

• High Brand Loyalty? +.1

• Long Purchase Cycle? -.1

• Product Used Occasionally? +.1

• Need To Beat Competition? +.2

• Advertising To Older Consumers/Children? +.2

• Total= .6

Simple Copy? -.1

• Simple Copy? -.1

• Copy More Unique? +.1

• New Campaign? +.2

• Product Sell Copy? +.1

• Single Message? -.1

• New Or Old Messages? +.1

• Larger Ad Units? -.1

• Total=.2

Low Ad Clutter? +.2

• Low Ad Clutter? +.2

• Compatible Editorial? +.1

• Attentiveness? +.1

• Continuous Advertising? -.1

• Few Media Used? +.2

• Opportunities For Media Repetition? -.1

• Total=+.4

Spot advertising (regional)

• Spot advertising (regional)

• Washington, Oregon, Northern Idaho, Wisconsin, North and South Dakota, Minnesota, Michigan.

Map shows locations of individual markets involved and to increase brand awareness in these states

• Map shows locations of individual markets involved and to increase brand awareness in these states

Table shows number of stores in market area.

• Table shows number of stores in market area.

Food was featured most prominently (i.e. appearing on screen for more than 50% of the time) in approximately one quarter of general audience ads, including 35% of Sonic Ads and almost one-third of Pizza Hut, Dunkin Donuts, KFC, Dairy Queen, and Taco Bell ads. Food was shown being consumed in nearly half of ads.

• Food was featured most prominently (i.e. appearing on screen for more than 50% of the time) in approximately one quarter of general audience ads, including 35% of Sonic Ads and almost one-third of Pizza Hut, Dunkin Donuts, KFC, Dairy Queen, and Taco Bell ads. Food was shown being consumed in nearly half of ads.

The Majority of Sonic ads (54%) showed customers eating in their cars. Wendys (28%) and Pizza Hut (24%) showed eating at the table more than any other restaurants. Taco Bell (28%) Sonic (11%) and Burger King (9%) promoted late night menus and eating late at night in their ads.

• The Majority of Sonic ads (54%) showed customers eating in their cars. Wendys (28%) and Pizza Hut (24%) showed eating at the table more than any other restaurants. Taco Bell (28%) Sonic (11%) and Burger King (9%) promoted late night menus and eating late at night in their ads.

Primary competition is McDonalds, the Market leader.

• Primary competition is McDonalds, the Market leader.

• McDonald's Delivers A January Comparable Sales Increase Of 6.7% in February 2012, McDonalds does well in winter months, we plan to heavy up our advertising expenditures during summer months

We have chosen four media classes.

• We have chosen four media classes.

• TV-Regional Spot ads

• Radio

• Internet-Social Media

• Outdoor-Billboards

TV is the most important medium to advertisers and consumers.

• TV is the most important medium to advertisers and consumers.

• 2008, watching TV ranked third among all of life’s activities, Average person=2.6 hours a day.

• TV ranks second in consumer perception of influence on purchase decisions.

• Buying time spots for individual programs or cable channels will best reach the target audience.

• Selective Reach- targeting possible with correct program selection, for Sonic, Sports and News networks will most likely reach target.

• Flexibility- Spots available from :10 to :90+ that allow us to remind quickly or persuade easily.

Strengths

• Strengths

• Radio is excellent for local businesses

• 80% of total radio spending is local businesses

• Targeting- certain demographics and lifestyles, from teens to older adults, more precisely than most other media.

• Cost Efficient, less than 50% of TVs CPP.

• Tighter Geographic Targeting

• Affordable

• Creative Impact

We have Chosen 2 Radio Stations to advertise on:

• We have Chosen 2 Radio Stations to advertise on:

• KCLK- 1430AM- ESPN Sports Radio

• Our target listens to sports radio, this is a regional station.

• KAVZ-LP- 102.5 FM Community Radio

• Local Radio Station, directly targeting consumers within areas, that have a sonic restaurant.

Strengths

• Strengths

• Engagement: Customer Engagement

• Direct Consumer Communication: Quick information about consumer and customer preferences and issues in real time and regularly.

• Low Cost: It can almost be free, except for it is labor intensive.

• Brand Building: Engaging consumers and building long term relationships contributes to brand equity and brand loyalty.

Strengths: Large format gives them tremendous impact in outdoor marketplace.

• Strengths: Large format gives them tremendous impact in outdoor marketplace.

• Locating on major highways and expressways, placed in areas of high density vehicle traffic.

• Excellent visibility, they allow for creative customizing via extensions and embellishments.

• Directional: along the highway that tell passerby where to exit for Sonic.

• Can include Digital components, to be managed from a central location.

Social Media

• Social Media

• Promotions
• Foster customer interaction via Facebook and Twitter
• Garner attention in North West region through updates and customer interaction
• “Late Night Adventures with Sonic” where consumers post and/or tweet experiences

TV: Index of 105. Sonic= 5,756,000/18,908,000 (fast food customers in region) x 100= 30.4% of target views spot TV advertisements.

• TV: Index of 105. Sonic= 5,756,000/18,908,000 (fast food customers in region) x 100= 30.4% of target views spot TV advertisements.

• Radio: Index 105. Sonic=5,697,000/19,544,000(fast food customers in region, using radio) x 100= 29.1% of target.

• Outdoor-Billboard: Index 122. Sonic=6,637,000/20,878,000(100)= 31.7%

• Internet-Social Media: Index 111. Sonic=6,062,000/19,993,000(100)=30.3%