Retailers, Be Like Chick-fil-A (Or Die)
Earlier last month, an app springboarded past Facebook, Instagram, Snapchat and, well, every other app in existence to claim the coveted number-one spot in the App Store.
What was this new technological marvel?
It was Chick-fil-A. Yes, you read that right. The fast-food chain’s Chick-fil-A One app had staged its coup through a very simple proposition: download it and get a free chicken sandwich. Of course, the company was betting you’d stick around for what the app also offered, chiefly the ability to order ahead, redeem special offers, get coupons, etc.
Let’s quickly think about the economics:
- It costs roughly 77 cents to make a Big Mac. It’s probably safe to assume approximately the same is true for a Chick-fil-A chicken sandwich.
- Chick-fil-A averages $7.65 per transaction, making the effective discount roughly 10 percent.
- Only a few days after revealing the offer, Chick-fil-A had over 1M downloads and 131,000 redeemed sandwich offers.
- Factor in extensive press coverage — earned media, entirely free — and the value back to the company was probably in the multiple millions of dollars.
This is quite possibly the most cost effective and successful marketing campaign by a fast food chain in decades.
Here are the three takeaways for retailers, malls, and quick-service restaurants.
You need a 1:1 relationship with your customers to be successful | Whether it’s through an app or through Wi-Fi (not mutually exclusive), you need to know who your customers are and have a mechanism to provide them value via mobile. Physical world experiences are now required to be personalized, centering on experience.
You need an exchange of value | If your customers allow you to know who they are through a login to Wi-Fi or through downloading an app, you need to give them some value in return. There’s no need to overthink it: sometimes it’s as simple as a free chicken sandwich.
Focus on the experience | One of the major benefits of the the Chick-fil-A app is the ability to order ahead, to skip the line. Whether you are personalizing the experience, creating stores where experiencing the product is central (Best Buy, Apple Store) or making it easy to get in and out quickly, the primary competitive advantage of a business with a physical world presence is the experience. Invest in experience. And do it now.
As I’ve written about before, the primary difficulty facing retailers, QSRs, shopping malls and other businesses with physical locations is the challenge of actually knowing (with their permission) the identity of their customers. It’s the reason why we hear this time and again: “Half the money I spend on advertising is wasted; the trouble is I don’t know which half.” There’s no clarity into what’s working and what’s not.
On the flip side, you literally cannot buy a single product on Amazon without the e-commerce giant knowing your identity from the moment you’re on the site through the conclusion of your purchase. In order to compete, physical retailers need the same line-of-sight for all transactions in their real-world locations.
As a result of this hugely successful campaign, Chick-fil-A now has a major advantage in the evolution to a mobile-first mindset. They know who downloaded the app, what Chick-fil-A locations they’re frequenting, and when they purchase. They have a clear view of path to purchase for the probable millions of people who downloaded the app It’s the gift that keeps on giving.
The retailers who survive in our mobile-first world are the ones like Chick-fil-A. They understand that they must create the “logged-in” experience for the physical world. Whether through an app, or the even lower friction option of Wi-Fi (or both), you’re on your way to the gallows if you’re not solving for this.
Be like Chick-fil-A or die. Be like Amazon or die. Evolve rapidly, evolve now, or die.
