Facebook/Buffalo Wild Wings
- Arby's parent company Roark Capital Group completed its $2.9 billion acquisition of struggling Buffalo Wild Wings on Monday.
- Paul Brown, who led Arby's turnaround, will be CEO of the newly formed operating company that will oversee both Buffalo Wild Wings and Arby's.
- Brown told Business Insider that the major changes on Buffalo Wild Wings' horizon include new menu and marketing strategies.
- The biggest problem Brown says he has to solve: Buffalo Wild Wings lost what made it unique.
Buffalo Wild Wings needs a savior - and it may have found one in the form of the CEO who transformed Arby's business.
The chain has struggled over the last two years, with slumping sales and a months-long battle between executives and an activist investor.
On Monday, Arby's parent company Roark Capital Group closed a $2.9 billion deal to acquire Buffalo Wild Wings. Paul Brown, who oversaw a massive turnaround effort as Arby's CEO, will serve as the CEO of the newly formed operating company Inspire Brands, which encompasses Arby's, Buffalo Wild Wings, and R Taco.
On Tuesday, Brown sat down with Business Insider to talk about the new operating company and his plan to turn around Buffalo Wild Wings.
"There will obviously be some changes to the menu, changes to the experience, and changes to the marketing," Brown said.
And, while Buffalo Wild Wings isn't going to transform into Arby's 2.0, the sandwich chain's turnaround has become a blueprint for the future of the wings chain.
"I think the process and the mindset of how we went about it is exactly how we're going about it with Buffalo Wild Wings, too," Brown said.
Solving Buffalo Wild Wings' biggest problem
J.D. Pooley/Associated Press
Buffalo Wild Wings needs to double down on its sports bar roots.
According to Brown, Buffalo Wild Wings' biggest problem is that it lost what set the chain apart from the competition.
"I think that if you look back when Buffalo Wild Wings was really, really, really successful, it was really the only one out there doing what it was doing," Brown said. "We had a nationalized local sports bar, and then more competition has come in, and I think that some of that competition has been a little bit more innovative."
Brown continued: "I think there's an opportunity to figure out the 21st century incarnation of what made it so successful during, particularly, the early 2000s."
A "sea of sameness" has emerged as a common problem in the casual, sit-down dining industry in recent years. Buffalo Wild Wings, which shifted its marketing as a sports bar to a more general casual-dining chain, was caught up in the industry sales slump as millennial diners ditched the sector.
"Millennial consumers are more attracted than their elders to cooking at home, ordering delivery from restaurants, and eating quickly, in fast-casual or quick-serve restaurants," Sally Smith, then-CEO of Buffalo Wild Wings, wrote in a letter to shareholders explaining slumping sales in May 2017.
A major part of Brown's turnaround plan for Buffalo Wild Wings is emphasizing what makes it different from other sit-down chains
"When it was growing gangbusters," Brown said, "it didn't position itself against its traditional cast of casual-dining players ... I think there's an opportunity to step way back and say 'it's not,' and let it define its own category, a little bit of what we did with Arby's."
Buffalo Wild needs a menu no one else could serve
Buffalo Wild Wings needs a new menu strategy. Currently, much of the chain's success depends on chicken prices, which can be extremely volatile.
"Ultimately, if you're in the restaurant business it comes down to food and innovation," Brown said.
To fix Buffalo Wild Wings' menu, Inspire Brands is turning to Arby's for inspiration.
Arby's realized that it needed to serve menu items that customers couldn't buy anywhere else. If the menu item was sold elsewhere, Arby's needed to have the lowest price available.
The chain kept its iconic roast beef sandwich and Jamocha shake on the menu, but it also began rolling out wild limited-time offerings like the Meat Mountain, which contains every meat on Arby's menu between two buns.
At Buffalo Wild Wings, Brown plans to roll out a similar strategy - looking for things that other chains aren't serving but that Buffalo Wild Wings can provide. After years of Buffalo Wild Wings' menu staying mostly the same, the chain is on the cusp of a new era of innovation inspired by Arby's.
"There's been a loss of product development at Buffalo Wild Wings over time, partially because casual dining to date has not done as much of it," Brown said.
Inspire Brands wants to fix that with the roll-out of a "systematic" approach that allowed Arby's to churn out creative new menu items at a rapid pace.
A new 'persona' is on the horizon
Arby's success has also been tied to its creative and sometimes borderline bizarre marketing strategy.
The chain debuted the bold "We Have the Meats" campaign in 2014. Its social-media manager was given more freedom that year after a tweet comparing Pharrell Williams' hat at the Grammy Awards to Arby's logo went viral.
"Create the personality, the brand, use earned media and all forms of earned media to create a persona around it as well as an awareness around it," Brown said. "If you think about it, the Buffalo Wild Wings brand is made for that. "
Buffalo Wild Wings' "persona" isn't going to be a rip-off of Arby's, but it will involve taking similar risks.
"If we sit here a year from now saying that Buffalo Wild Wings is sounding a lot like Arby's, then we failed," Brown said.
Brown continued: "I think that is going to be the key - how we actually take the learnings and the capabilities from what we done, and leverage those learnings, leverage the infrastructure, and do it in a way that the brands look completely different from each other."
Nothing at Buffalo Wild Wings is going to change - yet
When asked what customers can expect to change at Buffalo Wild Wings, Brown said: "nothing." Much of the work to turn around the chain will be occurring behind the scenes, at least for the next few months.
Brown has already met with some Buffalo Wild Wings franchisees, who became the backbone of his Arby's turnaround plan. In January, before the deal had officially closed, Inspire Brands started consumer research to figure out what exactly is going wrong at Buffalo Wild Wings.
This research will determine exactly what Buffalo Wild Wings' new era will look like. Arby's provides a blueprint for what will change, including the menu strategy and marketing.
However, Brown will need to prove that Arby's success wasn't a fluke.
Inspire Brands plans to acquire a diverse array of chains in need of "repositioning," Brown said. Buffalo Wild Wings is the test drive of whether Arby's turnaround can be replicated - or whether Brown is operating with a flawed blueprint.
EXCLUSIVE FREE SLIDE DECK:The Future of
Get the Slide Deck Now »