3 Key Moves That Built Subway a $4B Product
Subway's $5 Footlong sub sandwich has grown into a sales powerhouse that now brings in $4 billion a year, chief marketing officer Tony Pace recently told Brandweek. The story of how the Footlong became such a smash success highlights several important aspects of Subway's culture that any retailer would do well to emulate.
Here's how Subway made the Footlong happen:
Listen to franchise owners. The Footlong was created by one Florida Subway franchise owner. Rather than squelch the idea since it wasn't developed by corporate (as so many chains would do), the company looked to franchisees as a valid source of innovative ideas for the chain. This is how franchise networks are supposed to work -- the corporate parent values franchisee input. Subway's attitude stands in marked contrast to the mood over at rival Quiznos, where franchisees have been unhappy and felt ignored for years.
Respond to customers. When customers responded enthusiastically to the Footlong's value deal, Subway expanded its presence chainwide and actively marketed the sub. It created dozens of variations on the Footlong. The result? Subway's recent market testing indicates 90 percent of people aged 12 to 64 recognize the Footlong.
Be flexible in marketing. When Pace came aboard, Subway was advertising only 33 weeks a year. He boosted that to a year-round ad plan, and Subway reaped the benefits. When a particular ad campaign worked for store owners, Subway extended it. For instance, Pace says a recent planned one-month promotion of the Footlong is now in week 130. If it's working for the stores, why not keep it going? Few chains seem to have this kind of flexibility in their thinking.
At base, the Footlong's success is all owed to good relations and open lines of communication between corporate parent and store owners. At a time when KFC franchisees dislike the company's marketing so much they are suing to take control of it, and Burger King owners are suing after the corporation compelled them to sell underpriced cheeseburgers, Subway's responsive, flexible approach is refreshing. Who knows how many great menu or marketing ideas these other chains are missing because they're not tuned in to what franchise owners are thinking.
Photo via Flickr user Eli Hodapp
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