Wendy’s introduced on Monday its new line of Dave’s Hot ‘N Juicy Cheeseburgers, a product launch it has tested for nearly a year and a major move sources say is needed to spark sales.
The cheeseburgers, named for the brand’s founder and longtime spokesman Dave Thomas, feature thicker beef patties, toasted and buttered buns, and upgraded ingredients like crinkle-cut pickles and red onions. At a downtown Chicago location, the burger was selling for $3.99 for a single, $5.19 for a double and $6.59 for a triple.
Wendy’s first began its test of the menu item with advertising in Las Vegas in November 2010. During the test time, competitors like McDonald’s — which rolled out its Angus Third Pounder burgers in July 2009 — and regional chains like Five Guys Burgers & Fries and Smashburger have each made waves with “better burgers.”
Wendy’s executives said during its second-quarter conference call that the new burgers produced an incremental same-store sales increase of between 2 percent and 3 percent in test marketing. As part of its “Project Gold Hamburger” effort, Wendy’s tested the upgraded cheeseburgers in Las Vegas; Virginia Beach, Va.; Providence, R.I.; Austin, Texas; and Mobile, Ala.
In August, SunTrust Robinson Humphrey securities analyst Chris O’Cull said in a research note that the burger debut should help lift sales and profit, and help Wendy’s gain market share.
“The upgraded cheeseburger line has the potential to help Wendy’s capture one additional percentage point of [quick-service] burger market share over the next two to three years,” he said, “which we estimate would contribute $65 million in annual [earnings before interest, tax, depreciation and amortization.]”
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