How Wingstop Benefited During Pandemic | Technology for Digital Ordering Already in Place

Mid-March of 2020 will forever be seen as the point at which life fundamentally changed, especially for the restaurant industry. For the leadership team at Dallas-based Wingstop, it wasn’t just a stressful period of communicating with franchisees, assembling a COVID taskforce, implementing new sanitation measures, and shuttering the company’s headquarters. It was also a moment of truth. The brand’s big bets on high-tech innovations to power its fairly simple business of serving chicken wings, fries, and drinks were about to be put to the test.

Those bets were placed by Charlie Morrison, Wingstop’s CEO. Since arriving in 2012, he’d implemented a strategy centered on making access to the company easier for guests, primarily through new ordering solutions. “Quite frankly, if we didn’t provide that efficiency and that access, we may not be as successful as we are,” he says. “And I think the pandemic has proven that, for our brand in particular; it was available, it was understood and well known, and it was easy to adapt to. Whereas some other brands were not as ready or as advanced, and so it’s been a challenge to catch up on the curve.”

The pandemic has proven that and then some. In a season when industry sales are contracting by hundreds of billions of dollars, Wingstop reported domestic same-store sales gains of over 25 percent for 2020’s third quarter. The big bets have paid off handsomely. And even more than in prior years, Wingstop has become the model of what is possible in the limited-service industry.

THE BUILDING BLOCKS

While nobody could have predicted that a pandemic would drastically reshuffle the restaurant industry this year, it quickly became apparent that the so-called winners of the COVID-19 crisis were those that had already invested in digital ordering and a robust off-premises strategy.

Indeed, Wingstop seemed almost prophetic for already working toward a goal of having 100 percent of its sales be placed digitally. That work started when Morrison came over to the company from RAVE Restaurant Group—parent to Pizza Inn and Pie Five—in 2012. At the time, he says, Wingstop was strong in executing its operation, but lacked discipline in areas like marketing, supply chain, and technology—“fundamental building blocks,” he says, that were necessary to scaling the concept aggressively.

“When I first got to the brand, we actually had an online ordering mechanism,” he says. “It was poorly and loosely constructed, as you could imagine, but it worked. You had an app, you could go on your phone, you could order wings. But that was where the technology stopped and the analog process began.”

It was then that Morrison’s experience in the pizza category became an advantage, as he says he recognized the opportunity to simplify that ordering process. And simplification started with consistency across the system so that the company’s franchisees—“brand partners”—could be on the same page and trust that the investments would be sound. So Wingstop standardized its POS system and its menu, then rolled out an integrated, enterprise-grade online-ordering system.

Stacy Peterson, Wingstop’s chief technology officer, says these fundamental technology tools gave the brand partners the confidence they needed to believe in the power of online ordering. “It wasn’t until the brand partners could rely on the systems that we put in place [that] they started promoting it to their guests,” she says. “And once they started promoting it to our guests, we saw our digital adoption increase, and we increased organically every year [by] 4 or 5 percent year over year.”

Wingstop has since doubled down on digital ordering capabilities; guests today can order via the company’s app or website, as well as via DoorDash. By early March, Wingstop’s digital mix was about 40 percent of sales; the pandemic has since pushed it to over 60 percent, which Morrison says is two years ahead of schedule.

Because all of these digital orders are integrated into the back end, Peterson says, it eliminates any complexities for the brand partners. “If they bring it up with the guest standing in front of them, or the guest is on a myriad of accessible channels where they could place their order, they all come in the exact same way, exact same ticket, exact same make line,” she says.

The benefits of these digital solutions were evident: Not only did they streamline operations, but they also boosted the top line. Average checks for digital orders are $5 higher than those through non-digital channels.

AN UNFAIR ADVANTAGE

The COVID-19 outbreak forced one word into every restaurant operator’s everyday lexicon: pivot. Brands had to scramble to adopt contactless operations, enhance store sanitation, and roll out additional access points to keep sales flowing.

But at Wingstop, no grand pivot was necessary; the tech stack already ensured efficient digital ordering, and business was about 80 percent off-premises even before the word coronavirus became a household term. Mahesh Sadarangani, Wingstop’s COO, says the company chose to close dining rooms before it was mandated by legislation, ensured stringent sanitation measures, invested in employee safety strategies, and implemented additional precautions like tamper-evident stickers to its delivery packaging.

Messaging became another area that demanded a quick pivot across the industry. Many restaurant companies—especially wing and pizza brands—were heavily marketing March Madness, which was only days away from starting when COVID-19 grounded public activities to a halt. And the fact that, early in the pandemic, there was a lot of uncertainty around how COVID-19 spread, companies had to communicate with guests in such a way that gave them confidence in the experience.

Christina Clarke, CMO, says that even in messaging, there was no need for Wingstop to make sweeping changes. She says the brand had already tailored its messaging to the fact that wings are very social but also highly individualized; Wingstop’s 11 flavors allowed for menu personalization, and its combo meals helped make wings more of a center-of-the-plate item rather than just a shareable. The company had filmed commercials in late 2019, she says, that focused on online ordering, delivery, and bringing families together with variety—three favorable messages for the quarantine era—and once the pandemic hit, the objective became showing up where consumers were.

“We saw where the eyeballs were going. … They were going to streaming, they were going to digital, online activities,” Clarke says. “And that’s exactly where we moved our messaging and made some minor modifications to make sure that delivery was coming through loud and clear, as it was originally intended.” That included free-delivery promotions early in the pandemic, and digital campaigns like the 24-hour virtual DJ festival it hosted on National Chicken Wing Day, July 29.

Of course, pivoting couldn’t staunch the hemorrhaging sales at most restaurants. Industry sales dropped precipitously once dining rooms closed, and at many brands, they still haven’t recovered. Those companies that were able to quickly rebound were the ones that regained customer trust and offered a seamless and safe ordering experience—an unfair advantage for 26-year-old Wingstop.

“We had created a trustworthy platform for our guests to enjoy our product without having to come into the restaurants,” Morrison says. “That’s built over a long period of time, and developing that trust is really important. If you look at a lot of consumer research that’s been done since the pandemic started, the things that are now most important to consumers are trustworthy brands.”

BUILDING TRUST

Developing that trust isn’t something that happened by accident. Morrison credits Wingstop’s core values—being service-minded, authentic, fun, and entrepreneurial—for guiding the brand’s decisions during the COVID-19 crisis.

Donnie Upshaw is Wingstop’s senior vice president of people, tasked with building and maintaining that bond that the wings brand has established with its 241 corporate team members and about 300 brand partners who own all but 31 of the 1,450-plus worldwide locations. “From a cultural perspective, the fun that you see, the entrepreneurial spirit, the service mindedness, all those things come to life in different ways based on your role,” he says. “But every single team member is held to that accountability to live our values.”

In normal times, Wingstop invests in its corporate team through opportunities for advancement, unlimited paid time off, participation in community outreach, and all-hands meetings that Upshaw says prevent the “NETMA” problem (“nobody ever tells me anything”).

As it has for most businesses, the pandemic has forced Wingstop to get more creative with its corporate outreach, as the headquarters is closed and the team is working from home. Wingstop gave employees a stipend to set up a home office, allowed for flexible schedules so they could navigate around home issues, and hosted weekly all-hands calls via Zoom.

The pandemic wasn’t the only crisis to stress-test the culture in 2020; so, too, did the murder of George Floyd in Minneapolis in May and the proceeding Black Lives Matter protests across the country. Upshaw says the company recognized the role it needed to play for its diverse team, and it wasn’t just to offer thoughts and prayers.

“We can’t just write a check and we can’t just send out a tweet. We have to make this scalable. We have to make this impact be felt across our 1,400-plus restaurants,” he says. “We can’t just be cool when it’s convenient. And I think that is one thing that we’re learning through all of this: It is going to be hard. It’s heavy lifting, but it is our responsibility.”

To start, Wingstop chose to listen to its employees. While the team usually stays on mute during the weekly all-hands videos, Morrison says he invited the more than 250 people on a call in late May to unmute so they could voice their feelings—a “raw” and “highly emotional” experience, he says. From there, Wingstop created a task force charged with creating actionable insights for the entire system.

“We as leaders are given the responsibility and the authority to make decisions and do things that can impact not only our organizations, but the world around us,” Morrison says. “What we need to do is listen, open the conversation with our people. As a white man, I don’t understand everything that a Black person goes through in this world today, but I want to learn and understand that so that I can affect change in whatever way I can.”