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Table of Contents
Executive Summary 1
Situation Analysis 3
Objectives 11
Media Strategy 16
Media Mix 20
Budget and Flowchart 21
Conclusions 22
References 23
Appendices 24
0
Executive Summary
“Our vision is simple: to become America’s most loved restaurant brand.” (sonicdrivein.com)
Sonic is the largest chain of drive-in restaurants in the United States that specializes in serving quality American
cuisine, providing a unique dining experience, and roller skating.
Sonic brought in about $3.8 billion in sales at the end of 2013. Sonic holds 8.2% of the burger restaurant market
share and is ranked 4th out of the top burger restaurant market share holders. The goal is to gain more market share, and
to increase by 1% to 9.2% by next year. Our media plan with a budget of $170 million will effectively increase sales. We
will use $50 million each year for 3 years.
The overall objective for our media plan is to have Sonic increase market share by 1% in a fiscal year. To do this,
we need to raise sales by $118.3M per quarter. An additional objective to help us reach this goal and increase market
share is by opening 30 new stores in the northwestern and mid-northern states. In the last 5 years Sonic has gradually
started moving into Washington, Oregon, parts of northern Idaho, Wisconsin, North and South Dakota, Minnesota and
Michigan.
Research indicates that our target audience will be primarily focused on adults ages 18-44 and parents with
multiple children.
The average frequency we will be aiming for is 2.7. Starting at the standard recommended average frequency of 3,
we have adjusted allowing for considerations such as brand popularity, budget, purchase cycles and other brand
1
objectives. During summer months when the weather is better, we will strive to increase our reach to 80%. During the
maintenance phase, we will drop to 40%.
Our advertising efforts are nationally spread, with spot markets in Jackson, TN; Abilene-Sweetwater, TX; San
Antonio, TX; El Paso, TX; Tyler-Longview, TX; Kansas City, KS; Biloxi-Gulfport, MS; and other cities.
Our media plan focuses on Spot TV, digital, and radio advertisements. These advertising efforts were carefully
selected based on the demographics of our target market and their media consumption tendencies.
All components of our plan were thought out while developing our media plan. Sonic will reach their market share
goal through the media plan to increase market share, sales, brand loyalty, and consumer’s awareness.
2
Situation Analysis:
Company History:
Sonic Drive-In started in 1953 as Top Hat, a Drive-Up Root Beer stand in Shawnee, Oklahoma, owned and
operated by Sonic founder Troy N. Smith Sr. Customers would park on the gravel lot on the 5 acre piece of land and walk
up to the window to order.
Soon after, Smith saw a similar restaurant that used speakers to place orders and the idea for Sonic was born. The
idea of ordering food without leaving the car was revolutionary. The slogan “Service at the Speed of Sound” was created
and translated to one word: SONIC. In 1959, the name was changed from Top Hat to Sonic Drive-In.
With the help of a new business partner, Charles Woodrow Pappe, Smith adapted his stand to the iconic Sonic Drive-In
layout we know today, and changed the name to Sonic to appease trademark laws.
Sonic was not officially incorporated until 1978, and began to trade on the New York Stock Exchange in 1991.
Presently, Sonic serves about 3 million customers daily. All Sonic stores have a standardized look, known throughout the
company as “retro-future”, as well as menu and employee code.
The majority of Sonic’s locations are in southeastern area of the United States, but they are progressively opening
new locations throughout the continental US, as well as 7 stores in Hawaii, scheduled to open in 2018.
Sonic previously marketed their restaurant as a personalized service with skating carhops that serves high quality
made-to-order food. Various promotions were used throughout the Sonic chain. Promotions were advertised through
various media outlets. These include television, radio, interactive media, point-of-sale materials, and other media. Sonic
promotions are typically for new limited-time products and signature menu items.
3
Marketing Analysis:
The overall market for the “Quick Serve Restaurant Industry” is highly competitive. Restaurants all strive for the
best prices, service, location, and food quality. The restaurants that fall into this category have a wide spectrum from
family owned food trucks to more gourmet restaurants. There are many factors that affect the competition, from changes
in consumer trends, economic conditions, demographics, traffic patterns, and concerns about the nutritional content of
quick-service foods. The primary competition for Sonic is american burger and hot dog chains. However, other
alternatives pose as fierce competition, including pizza and Mexican chains.
Sonic Drive-Ins
Sonic only holds 8.2% share of the burger restaurant market. Sonic brought in about $3.8 billion in sales at the end
of 2013. Sonic does not have any locations outside of the U.S., so this is one disadvantage in comparison to its
competitors.
Sonic currently has a variety of promotions including a “$3.99 Double Feature”(cheeseburger and small ice cream
shake), “Lil’ Breakfast Burritos” for $1.49, “Free Slush or Drink” with Sonic app download and account creation. The
“Sonic Wacky Pack” currently features 5 different Nerf toys.
McDonald’s
McDonald’s holds the highest share of the burger restaurant market at 34.3% (more than twice the share of Burger
King, which holds the second highest share). McDonald’s massive success is partially from their worldwide coverage.
Global sales for McDonald’s reached about $89 billion at the end of 2013. McDonald’s has 14,278 U.S. unit and 35,429
(28,691 franchised) total. McDonald’s spent $882 million on total advertising. They spent just under half of their
4
advertising money on TV advertising. The most money went into network TV, which was about $269 million. McDonald’s
spent about $160 million on Spot TV. McDonald’s current promotions include the McPick 2 (2 items for $5), $1 soft drinks,
and $2 small McCafe drinks.
Burger King
Burger King holds second place in the burger restaurant market at 15.4%. In 2013, Burger King produced about
$16 billion in global sales. About half of those sales came from the U.S. locations. Burger King has 13,667 total units
(13,615 franchised) and 7,436 U.S. units. Burger King spent about $304 million on total advertising, nowhere near the
McDonald’s budget. Burger King spent the most money on Network TV, which was about $109 million. The next highest
category was Cable TV, at $105 million. Burger King current promotions include the $3.49 Offer (2 cheeseburgers, 1
small fry, and 1 small drink), the 2 for $6 Whopper, and the Mix & Match 2 for $4 (breakfast items).
Wendy’s
Wendy’s takes third in this market at 13.9% market share - not far behind Burger King. Wendy’s generated $9.3
billion in 2013, with $8.9 billion from U.S. sales. Wendy’s has 6,557 total units (5,374 franchised). 6,158 of these units are
located in the U.S. Wendy’s spent $287 million on total advertising. Wendy’s spent the most money on Network TV, $86
million. The next highest category was $74 million. Wendy’s promotes “fresh never frozen” beef. Wendy’s is currently
promoting “Merry Cheesemas” which features a mushroom melt supreme, “We Rise So You Shine” for $4.50 breakfast,
“Wendy’s Seven Wonders” with a deal for each day of the week, and “Frosty Friday.”
Jack in the Box
Jack in the Box is below Sonic at fifth in this market. Jack in the Box brought in about $3.16 billion, with all sales
from within the U.S. There are 2,251 total units (1,786 franchised). Jack in the Box spent $82 million on total advertising.
They spent most of their advertising dollars on Spot TV, at about $68 million. Jack in the Box is currently promoting
5
Ribeye Burgers, peppermint sweet treats, and breakfast all day.
Communication Analysis:
The top performers in the “Quick Serve Restaurant Industry” have similarities in their messages and
communication outlets. McDonald’s, Burger King, and Wendy’s invest most of their advertising dollars into Network, Spot,
and Cable TV. The messages are very similar, and the restaurants promote quality food for the best deal.
These companies don’t advertise as much in magazines, radio, or internet. These outlets can be an opportunity for
Sonic to advertise in. TV outlets are already so cluttered with food advertisements. By using some Spot TV ads mixed
with other outlets, Sonic can gain a presence with a variety of audiences.
6
Strengths:
Sonic Drive-Ins are the largest drive-in chain in the country,
making them reputable and well-known. The culture of the Sonic Drive-In
is unique, and keeps customers coming back for more. What makes
Sonic stand out among its competitors is the drive-in experience.
Customers stay in their vehicle and have their food brought to them,
rather than just going through the drive-thru at another fast food chain.
Face-to-face interaction is more personal and helps build a relationship
between the employee and customer. The food is also made to order,
which will make the food fresher and more catered to each customer.
The roller skates are an iconic and memorable piece of the uniform. We
have no information if the skates make the service faster, but they
certainly add to the experience.
The Sonic menu has a variety of options including primarily American
food. Sonic serves their full menu all day, which includes breakfast
sandwiches and burritos.
7
Weaknesses
Sonic’s strict drive-in style does not make it very adaptable to urban areas where less people
have cars, or cities in colder climates, where roller-skating carhops are in danger of injury during
winter months. In addition, it’s standard set of TV commercials, while recognizable, severely limits
the possibility for development of new advertisements and branching campaigns. The popularity
of the video game character “Sonic the Hedgehog” also creates problems for clientele trying to
search for information about Sonic, or the Sonic website, by taking up many of the search results,
sometimes coming up before the Sonic Restaurant. Sonic’s menu does not have many healthy
options, which is a serious detriment as Americans have as a population have become far more
health conscious over the past ten years. This is especially true in the North and Western parts of
the country, and in urban areas, where Sonic is already not very well known.
8
Opportunities
Sonic has been successful in southern states but their business model does not necessarily cater to the South and
should likely be successful in northern states as well. The expansion will provide Sonic more widespread and hopefully
national brand awareness.
Sonic already offers food items that are different from other fast food restaurants’. Sonic can take this as an advantage
and increase menu items, catering to the region’s specific taste, to pay the region an homage and increase brand loyalty,
as consumers see this as the brand truly caring about them.
Sonic is also known for quirky, fun commercials and great deals, the latter of which other restaurants do not offer as
frequently. With the expansion, Sonic can attract even those who are not aware of the brand with the commercials and
sales.
9
Threats
Sonic provides a unique drive-in dining experience that is not duplicated on the same scale by any other national
restaurant chain. While Sonic is at the top of the industry for drive-in dining, there are significant threats to their business
through other forms of restaurant dining along with seasonal factors. The drive-in style is one that while unique, is
perhaps a little too specific. If customers are looking for a relatively quick dining experience, there are restaurants such as
McDonald’s that offer a menu with many of the same types of product but are delivered at a much faster rate. If food
seekers are wanting more out of their experience than a simple drive-through, they may often make the jump to the
classic sit down dining that could be found at say Red Robin. Another factor that may be a significant threat to Sonic’s
business is that they are primarily a warm weather restaurant. Customers of Sonic often order and eat in their car, or take
their food outside to the tables in the center of the restaurant area. As you can imagine, eating outside in December
wouldn’t be too enjoyable unless in California or other year round warm weather states. These factors pose as a
significant threat to Sonic’s business.
10
Objectives:
The overall objective for our media plan is to have Sonic increase market share by 1% in a fiscal year. To do this,
we need to raise sales by $118.3M per quarter.
An additional objective to help us reach this goal and increase market share is by opening 30 new stores in the
northwestern and mid-northern states. In the last 5 years Sonic has gradually started moving into Washington, Oregon,
parts of northern Idaho, Wisconsin, North and South Dakota, Minnesota and Michigan.
11
Media Objectives Chart:
Month Reach Frequency GRP % of Budget
September 60 2 120 5.8
October 50 2 100 4.9
November 40 3 120 5.8
December 40 2 80 3.9
January 40 1 40 1.9
February 55 2 110 5.4
March 70 4 280 13.6
April 70 3 210 10.2
May 80 4 320 15.6
June 75 3 225 10.9
July 80 4 320 15.6
August 65 2 130 6.3
Average​: 60.4 Average​: 2.7 Total: ​2,055
Average: ​171.25
Total: ​100
Average:​ 8.3
12
Target Audience Objectives
Our target audience will be primarily focused on adults ages 18-44 and parents with multiple children. The reason
our primary target audience are parents with more than one child is due to the fact that they often place high value on
convenience and price. Our dining style allows parents to pull into our restaurant, park their car, order and eat all without
having to unbuckle their seat belts. This creates a much desired experience as they do not have to deal with managing
their children inside a restaurant, and the entire process takes no more than 20 minutes altogether. Additionally, parents
tend to choose fast food restaurants because it is significantly cheaper than traditional dine-in restaurants especially when
considering you are buying meals for multiple children. Another factor of influence for selecting our target audience is that
parents of multiple children spend a lot of time driving them around to various places. This plays well into our OOH
advertising strategy as it will create awareness and in return produce parents selecting Sonic as their restaurant of choice.
Reach Objectives:
Our average reach objective is to reach 60.4% of our target audience. During summer months when the weather is
better, we will strive to increase our reach to 80%. During the maintenance phase, we will drop to 40%.
We will budget $150 million of our $175 million budget for advertising space. We will use a variety of outlets
including television, radio, and digital ads.
13
Frequency Objectives:
The average frequency we will be aiming for is 2.7. Starting at the standard recommended average frequency of 3,
we have adjusted allowing for considerations such as brand popularity, budget, purchase cycles and other brand
objectives. Sonic is a well-established brand already, however most of their locations are in the southeast portion of the
United States. Because of this, many of the new potential customers we aim to gain in the northwest United States have
heard of Sonic but are not necessarily familiar with the type of establishment Sonic is, or their menu options. Because of
this, having a frequency of around 3 allows us to inform customers, without them being affected by ad fatigue.
Fast food such as Sonic is something that has a very short product life cycle, however our consumers who eat fast
food more frequently do not need a proportional increase in ad frequency because they are exposed to the advertising on
Sonic Drive-In restaurants more frequently. Sonic does have large number of competitors such as McDonalds, Dairy
Queen, Burger King, Arby’s, and Jack-in-the-Box. Due to the large number of competitors, Sonic’s ad frequency must be
higher than a more well-established nationwide chain such as McDonalds.
Continuity Objectives:
Sonic is a restaurant which flourishes in the spring and summer months due to the nature of our dining style. Most
all of our restaurants have an outdoor element that involves roller skating delivery service to the customer’s vehicle,
making the winter month’s difficult on business. With this in mind, the majority of our advertisements will run more
frequently during the spring and summer to increase awareness and drive customers to our restaurants. As a result of
this, we will run a pulsing continuity schedule. This will allow our brand to still have a presence year round, while focusing
our advertisement dollars most heavily on the primary months of consumption.
14
Impact Objectives:
Because Sonic as a brand is not as well-known in the regions that the company is planning to expand to, it is
important to show prospective consumers what kind of items Sonic offers. With the food items, as well as the service,
being rather unique and different from other fast food restaurants, impact is integral in this campaign. Visuals, including
color and demonstration, are important, as the former shows the colors of the food items, making them appealing, and the
latter to show how Sonic's stands out from other fast food restaurants in terms of service.
Sonic is well-known for its commercials with the two men, it would be helpful to use the same type of humor and visuals,
making the brand consistent.
15
Media Strategy:
TV:
Sonic has some long standing and recognizable television commercial advertisements, variations of which will
continue to air. Sonic consumers do not watch very much daytime television, so our media vehicles will focus mainly on
Prime Time TV. The media vehicles we choose will appeal mostly to the target audience we are trying to acquire, parents
with multiple children. This target audience is likely to watch programming rated suitable for children such as sports, and
prime time dramas and comedies.
16
Out of Home (OOH) Media Strategy:
Sonic’s advertising media strategy will be heavily focused on Out of Home advertisements. We will place
advertisements in places such as billboards, bus stops, train stations, and other creative placements to create awareness
for potential customers on the move. This strategy allows our audience to see the advertisements nearby store locations
and at point of purchase, which will likely increase the chances of them visiting.
17
Radio Media Strategy
Radio advertising is compatible with Sonic as a brand and with a variety of factors in buying the media, it would
prove to be a successful medium in this campaign.
One of Sonic’s USP is the unique drive-in experience that no other restaurants offer: carhops in roller skates come
to the car with the order. This experience is reminiscent of the ‘50s and not offered in many other restaurants, much less
other national chains. Because much of the radio listening happens during car rides, we want to attract our consumers
through our fun and descriptive advertising and give them the call for action, i.e. “Try Sonic’s new item on [the local spot]
today!” We want the consumers to associate their car rides with the ads and consequently, Sonic. This may be further
strengthened when the ads play around a meal time, as the consumer will be thinking of food and more affected by the
appealing words of the ads.
We will buy both national and local radio spots; the former will strengthen the fact that we are trying to become a
national brand and the latter will strengthen the connection with its local consumers.
Digital:
App​:
The Sonic Drive-In app is currently being promoted. When customers download the app and create a new account,
they can receive a free slush or drink. The app allows customers to earn rewards every month and when the “MySONIC”
card is reloaded. The app also lets customers check in to pay when parked at the restaurant or in the drive-thru, find
Sonic locations and hours, and send digital gift cards to friends.
The Sonic app is ranked #24 in the App store and is rated 4.8 stars from about 10,700 ratings. In comparison to
competitors, the Sonic app is dominating in high ratings. The McDonald’s app is currently ranked #2 in the app store but
only has a rating of 2.4 stars from about 3,570 ratings.Considering how large of a company McDonald’s is, these numbers
18
are very poor. The Burger King app has 2.2 stars (208 ratings), Wendy’s app has 2.7 stars (57 ratings), and Jack in the
Box app has 4.1 stars (45 ratings). Continuing to promote this app through promotions and making it useful for its
customers will help continue brand loyalty as well as attracting new customers.
Social media​:
SONIC Statistics
Facebook: 4,518,486 likes
Twitter: 350K followers
Instagram: 313k followers
Sonic’s strongest social media presence is on Facebook. Promoting an ad to download the app to people near
restaurants will give Facebook users incentive to try Sonic. If users already have the app, it will be another reminder about
Sonic. Continuing to offer a free promotion with an app download and account creation will also drive people to the
restaurant.
19
20
Budget/Flowchart:
21
Conclusions:
In conclusion, we will use a variety of TV, OOH, Radio, and Digital advertising. By integrating a pulsing continuity
plan, we can push for more sales in summer but still have our message out all year long. Reaching between 40 to 80% of
our target audience over the next year will help us to increase overall market share by 1% (to 9.2%).
For the future, we plan to continue growing the popularity of our app and add more locations to the northwest and
midwest regions of the U.S. Expanding internationally would also give us more revenue, especially in warmer climates
where outdoor American cuisine could flourish.
Contingency:
For our contingency plan, we are setting aside $20 million for summer spot advertisements. This will allow us to
advertise extra when we need it and to push for grand opening announcements of our new locations. These are the
primary areas we would use our contingency money for.
22
References:
Bailey, R. (n.d.). Background and Objectives ComStrat 382 Final Project. Lecture, Pullman.
History. (n.d.). Retrieved December 11, 2017, from https://corporate.sonicdrivein.com/history/
SONIC. (2017). Retrieved December 11, 2017, from https://www.sonicdrivein.com/
23
Appendices:
Sonic Drive-In App
SONIC Drive-In Fact Sheet
HEADQUARTERS
300 Johnny Bench Drive
Oklahoma City, OK 73104
sonicdrivein.com
OVERVIEW
SONIC®, America’s Drive-In®, is the nation’s largest chain of drive-in restaurants with more than 3,500 drive-ins serving
approximately 3 million customers every day. Over the past 64 years, SONIC has delighted guests with signature menu items,
more than 1 million drink combinations, friendly service by iconic Carhops and ongoing support of education through its
award-winning Limeades for Learning® program. For more information about Sonic Corp. (NASDAQ/NM: SONC) and its
subsidiaries, please visit sonicdrivein.com. Customers can also connect with SONIC at facebook.com/sonicdrivein or on Twitter
@sonicdrivein.
HOURS OF OPERATION
Hours vary by location; however, our minimum hours of operation are 6 a.m. to 10 p.m., unless community standards warrant
other hours. During the summer, most drive-ins are open until midnight or later.
NUMBER OF DRIVE-INS
Sonic has 3,527 drive-ins located in 45 states
24
SALES
$1,244,000 average unit sales (FY15)
MENU
SONIC’s award-winning menu offers a variety of unique menu items made after you order. Menu items include TOASTER®
Sandwiches (made with thick Texas toast), Footlong Quarter-Pound Coneys, handmade Onion Rings that are sliced, breaded
and cooked fresh daily, Tots and a plethora of drink and dessert choices, such as our signature Cherry Limeades, featuring a
sweet touch of cherry to a delicious lime thirst quencher. SONIC has more than 1.3 million drink combinations, making it Your
Ultimate Drink Stop!®
HISTORY
Founder Troy Smith Sr. started SONIC, America’s Drive-In as a hamburger and root beer stand in 1953 in Shawnee, Okla.,
called Top Hat Drive-In. Back then, SONIC revolutionized the ordering process by using curbside speakers that allowed
customers to place food orders without ever leaving their cars. This technology spawned the slogan “Service at the Speed of
Sound™,” which translated to one word: SONIC. Troy Smith Sr. aptly changed the name from Top Hat to SONIC Drive-In in
1959. The first drive-in to adopt the SONIC name is still serving customers in Stillwater, Okla.
PHILANTHROPY
While our Oklahoma City, Okla. corporate office focuses on supporting programs that provide educational opportunities for
Oklahoma youth ages 4-22 and strong interest in the arts, the SONIC system bands together through Limeades for Learning®,
our national cause branding program that provides much-needed supplies and learning materials for teachers to help their
students learn. Through Limeades for Learning® in partnership with DonorsChoose.org, SONIC and its franchise partners have
donated more than $5 million to public school classrooms in local communities across the country. Visit
limeadesforlearning.com​ to learn more about SONIC’s commitment to education.
CARHOPS
Personal Carhop service is one of many reasons customers enjoy visiting SONIC. Frequently seen spinning by on roller skates,
smiling Carhops personally deliver orders right to customers’ cars. What’s more, Carhops check back to ensure a quality
experience. Each customer receives a mint with a drink, dessert or meal purchase – a tradition started by company founder
Troy Smith Sr. to remind customers they are worth a mint at SONIC.
25
FUN FACTS
In one year, SONIC:
– sells enough tots that when placed end-to-end would circle the globe…TWICE
– sells enough Footlong Quarter Pound Coneys to border the 48 contiguous United States
– sells enough Cherry Limeades to fill more than 15 Olympic sized swimming pools
– gives away enough mints to reach the top of the Empire State Building and back to the ground…5000 times.
Media Contact: Investor Contact:
Jason Acock Corey Horsch
SONIC, America’s Drive-In SONIC, America’s Drive-In
(405) 225-4828 (405) 225- 4800
Taken from Sonic’s website at: ​https://corporate.sonicdrivein.com/fact-sheet/
26
Sonic App Rating:
27
Sonic Franchise Information:
28

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Sonic Drive-In Media Plan

  • 1.
  • 2. Table of Contents Executive Summary 1 Situation Analysis 3 Objectives 11 Media Strategy 16 Media Mix 20 Budget and Flowchart 21 Conclusions 22 References 23 Appendices 24 0
  • 3. Executive Summary “Our vision is simple: to become America’s most loved restaurant brand.” (sonicdrivein.com) Sonic is the largest chain of drive-in restaurants in the United States that specializes in serving quality American cuisine, providing a unique dining experience, and roller skating. Sonic brought in about $3.8 billion in sales at the end of 2013. Sonic holds 8.2% of the burger restaurant market share and is ranked 4th out of the top burger restaurant market share holders. The goal is to gain more market share, and to increase by 1% to 9.2% by next year. Our media plan with a budget of $170 million will effectively increase sales. We will use $50 million each year for 3 years. The overall objective for our media plan is to have Sonic increase market share by 1% in a fiscal year. To do this, we need to raise sales by $118.3M per quarter. An additional objective to help us reach this goal and increase market share is by opening 30 new stores in the northwestern and mid-northern states. In the last 5 years Sonic has gradually started moving into Washington, Oregon, parts of northern Idaho, Wisconsin, North and South Dakota, Minnesota and Michigan. Research indicates that our target audience will be primarily focused on adults ages 18-44 and parents with multiple children. The average frequency we will be aiming for is 2.7. Starting at the standard recommended average frequency of 3, we have adjusted allowing for considerations such as brand popularity, budget, purchase cycles and other brand 1
  • 4. objectives. During summer months when the weather is better, we will strive to increase our reach to 80%. During the maintenance phase, we will drop to 40%. Our advertising efforts are nationally spread, with spot markets in Jackson, TN; Abilene-Sweetwater, TX; San Antonio, TX; El Paso, TX; Tyler-Longview, TX; Kansas City, KS; Biloxi-Gulfport, MS; and other cities. Our media plan focuses on Spot TV, digital, and radio advertisements. These advertising efforts were carefully selected based on the demographics of our target market and their media consumption tendencies. All components of our plan were thought out while developing our media plan. Sonic will reach their market share goal through the media plan to increase market share, sales, brand loyalty, and consumer’s awareness. 2
  • 5. Situation Analysis: Company History: Sonic Drive-In started in 1953 as Top Hat, a Drive-Up Root Beer stand in Shawnee, Oklahoma, owned and operated by Sonic founder Troy N. Smith Sr. Customers would park on the gravel lot on the 5 acre piece of land and walk up to the window to order. Soon after, Smith saw a similar restaurant that used speakers to place orders and the idea for Sonic was born. The idea of ordering food without leaving the car was revolutionary. The slogan “Service at the Speed of Sound” was created and translated to one word: SONIC. In 1959, the name was changed from Top Hat to Sonic Drive-In. With the help of a new business partner, Charles Woodrow Pappe, Smith adapted his stand to the iconic Sonic Drive-In layout we know today, and changed the name to Sonic to appease trademark laws. Sonic was not officially incorporated until 1978, and began to trade on the New York Stock Exchange in 1991. Presently, Sonic serves about 3 million customers daily. All Sonic stores have a standardized look, known throughout the company as “retro-future”, as well as menu and employee code. The majority of Sonic’s locations are in southeastern area of the United States, but they are progressively opening new locations throughout the continental US, as well as 7 stores in Hawaii, scheduled to open in 2018. Sonic previously marketed their restaurant as a personalized service with skating carhops that serves high quality made-to-order food. Various promotions were used throughout the Sonic chain. Promotions were advertised through various media outlets. These include television, radio, interactive media, point-of-sale materials, and other media. Sonic promotions are typically for new limited-time products and signature menu items. 3
  • 6. Marketing Analysis: The overall market for the “Quick Serve Restaurant Industry” is highly competitive. Restaurants all strive for the best prices, service, location, and food quality. The restaurants that fall into this category have a wide spectrum from family owned food trucks to more gourmet restaurants. There are many factors that affect the competition, from changes in consumer trends, economic conditions, demographics, traffic patterns, and concerns about the nutritional content of quick-service foods. The primary competition for Sonic is american burger and hot dog chains. However, other alternatives pose as fierce competition, including pizza and Mexican chains. Sonic Drive-Ins Sonic only holds 8.2% share of the burger restaurant market. Sonic brought in about $3.8 billion in sales at the end of 2013. Sonic does not have any locations outside of the U.S., so this is one disadvantage in comparison to its competitors. Sonic currently has a variety of promotions including a “$3.99 Double Feature”(cheeseburger and small ice cream shake), “Lil’ Breakfast Burritos” for $1.49, “Free Slush or Drink” with Sonic app download and account creation. The “Sonic Wacky Pack” currently features 5 different Nerf toys. McDonald’s McDonald’s holds the highest share of the burger restaurant market at 34.3% (more than twice the share of Burger King, which holds the second highest share). McDonald’s massive success is partially from their worldwide coverage. Global sales for McDonald’s reached about $89 billion at the end of 2013. McDonald’s has 14,278 U.S. unit and 35,429 (28,691 franchised) total. McDonald’s spent $882 million on total advertising. They spent just under half of their 4
  • 7. advertising money on TV advertising. The most money went into network TV, which was about $269 million. McDonald’s spent about $160 million on Spot TV. McDonald’s current promotions include the McPick 2 (2 items for $5), $1 soft drinks, and $2 small McCafe drinks. Burger King Burger King holds second place in the burger restaurant market at 15.4%. In 2013, Burger King produced about $16 billion in global sales. About half of those sales came from the U.S. locations. Burger King has 13,667 total units (13,615 franchised) and 7,436 U.S. units. Burger King spent about $304 million on total advertising, nowhere near the McDonald’s budget. Burger King spent the most money on Network TV, which was about $109 million. The next highest category was Cable TV, at $105 million. Burger King current promotions include the $3.49 Offer (2 cheeseburgers, 1 small fry, and 1 small drink), the 2 for $6 Whopper, and the Mix & Match 2 for $4 (breakfast items). Wendy’s Wendy’s takes third in this market at 13.9% market share - not far behind Burger King. Wendy’s generated $9.3 billion in 2013, with $8.9 billion from U.S. sales. Wendy’s has 6,557 total units (5,374 franchised). 6,158 of these units are located in the U.S. Wendy’s spent $287 million on total advertising. Wendy’s spent the most money on Network TV, $86 million. The next highest category was $74 million. Wendy’s promotes “fresh never frozen” beef. Wendy’s is currently promoting “Merry Cheesemas” which features a mushroom melt supreme, “We Rise So You Shine” for $4.50 breakfast, “Wendy’s Seven Wonders” with a deal for each day of the week, and “Frosty Friday.” Jack in the Box Jack in the Box is below Sonic at fifth in this market. Jack in the Box brought in about $3.16 billion, with all sales from within the U.S. There are 2,251 total units (1,786 franchised). Jack in the Box spent $82 million on total advertising. They spent most of their advertising dollars on Spot TV, at about $68 million. Jack in the Box is currently promoting 5
  • 8. Ribeye Burgers, peppermint sweet treats, and breakfast all day. Communication Analysis: The top performers in the “Quick Serve Restaurant Industry” have similarities in their messages and communication outlets. McDonald’s, Burger King, and Wendy’s invest most of their advertising dollars into Network, Spot, and Cable TV. The messages are very similar, and the restaurants promote quality food for the best deal. These companies don’t advertise as much in magazines, radio, or internet. These outlets can be an opportunity for Sonic to advertise in. TV outlets are already so cluttered with food advertisements. By using some Spot TV ads mixed with other outlets, Sonic can gain a presence with a variety of audiences. 6
  • 9. Strengths: Sonic Drive-Ins are the largest drive-in chain in the country, making them reputable and well-known. The culture of the Sonic Drive-In is unique, and keeps customers coming back for more. What makes Sonic stand out among its competitors is the drive-in experience. Customers stay in their vehicle and have their food brought to them, rather than just going through the drive-thru at another fast food chain. Face-to-face interaction is more personal and helps build a relationship between the employee and customer. The food is also made to order, which will make the food fresher and more catered to each customer. The roller skates are an iconic and memorable piece of the uniform. We have no information if the skates make the service faster, but they certainly add to the experience. The Sonic menu has a variety of options including primarily American food. Sonic serves their full menu all day, which includes breakfast sandwiches and burritos. 7
  • 10. Weaknesses Sonic’s strict drive-in style does not make it very adaptable to urban areas where less people have cars, or cities in colder climates, where roller-skating carhops are in danger of injury during winter months. In addition, it’s standard set of TV commercials, while recognizable, severely limits the possibility for development of new advertisements and branching campaigns. The popularity of the video game character “Sonic the Hedgehog” also creates problems for clientele trying to search for information about Sonic, or the Sonic website, by taking up many of the search results, sometimes coming up before the Sonic Restaurant. Sonic’s menu does not have many healthy options, which is a serious detriment as Americans have as a population have become far more health conscious over the past ten years. This is especially true in the North and Western parts of the country, and in urban areas, where Sonic is already not very well known. 8
  • 11. Opportunities Sonic has been successful in southern states but their business model does not necessarily cater to the South and should likely be successful in northern states as well. The expansion will provide Sonic more widespread and hopefully national brand awareness. Sonic already offers food items that are different from other fast food restaurants’. Sonic can take this as an advantage and increase menu items, catering to the region’s specific taste, to pay the region an homage and increase brand loyalty, as consumers see this as the brand truly caring about them. Sonic is also known for quirky, fun commercials and great deals, the latter of which other restaurants do not offer as frequently. With the expansion, Sonic can attract even those who are not aware of the brand with the commercials and sales. 9
  • 12. Threats Sonic provides a unique drive-in dining experience that is not duplicated on the same scale by any other national restaurant chain. While Sonic is at the top of the industry for drive-in dining, there are significant threats to their business through other forms of restaurant dining along with seasonal factors. The drive-in style is one that while unique, is perhaps a little too specific. If customers are looking for a relatively quick dining experience, there are restaurants such as McDonald’s that offer a menu with many of the same types of product but are delivered at a much faster rate. If food seekers are wanting more out of their experience than a simple drive-through, they may often make the jump to the classic sit down dining that could be found at say Red Robin. Another factor that may be a significant threat to Sonic’s business is that they are primarily a warm weather restaurant. Customers of Sonic often order and eat in their car, or take their food outside to the tables in the center of the restaurant area. As you can imagine, eating outside in December wouldn’t be too enjoyable unless in California or other year round warm weather states. These factors pose as a significant threat to Sonic’s business. 10
  • 13. Objectives: The overall objective for our media plan is to have Sonic increase market share by 1% in a fiscal year. To do this, we need to raise sales by $118.3M per quarter. An additional objective to help us reach this goal and increase market share is by opening 30 new stores in the northwestern and mid-northern states. In the last 5 years Sonic has gradually started moving into Washington, Oregon, parts of northern Idaho, Wisconsin, North and South Dakota, Minnesota and Michigan. 11
  • 14. Media Objectives Chart: Month Reach Frequency GRP % of Budget September 60 2 120 5.8 October 50 2 100 4.9 November 40 3 120 5.8 December 40 2 80 3.9 January 40 1 40 1.9 February 55 2 110 5.4 March 70 4 280 13.6 April 70 3 210 10.2 May 80 4 320 15.6 June 75 3 225 10.9 July 80 4 320 15.6 August 65 2 130 6.3 Average​: 60.4 Average​: 2.7 Total: ​2,055 Average: ​171.25 Total: ​100 Average:​ 8.3 12
  • 15. Target Audience Objectives Our target audience will be primarily focused on adults ages 18-44 and parents with multiple children. The reason our primary target audience are parents with more than one child is due to the fact that they often place high value on convenience and price. Our dining style allows parents to pull into our restaurant, park their car, order and eat all without having to unbuckle their seat belts. This creates a much desired experience as they do not have to deal with managing their children inside a restaurant, and the entire process takes no more than 20 minutes altogether. Additionally, parents tend to choose fast food restaurants because it is significantly cheaper than traditional dine-in restaurants especially when considering you are buying meals for multiple children. Another factor of influence for selecting our target audience is that parents of multiple children spend a lot of time driving them around to various places. This plays well into our OOH advertising strategy as it will create awareness and in return produce parents selecting Sonic as their restaurant of choice. Reach Objectives: Our average reach objective is to reach 60.4% of our target audience. During summer months when the weather is better, we will strive to increase our reach to 80%. During the maintenance phase, we will drop to 40%. We will budget $150 million of our $175 million budget for advertising space. We will use a variety of outlets including television, radio, and digital ads. 13
  • 16. Frequency Objectives: The average frequency we will be aiming for is 2.7. Starting at the standard recommended average frequency of 3, we have adjusted allowing for considerations such as brand popularity, budget, purchase cycles and other brand objectives. Sonic is a well-established brand already, however most of their locations are in the southeast portion of the United States. Because of this, many of the new potential customers we aim to gain in the northwest United States have heard of Sonic but are not necessarily familiar with the type of establishment Sonic is, or their menu options. Because of this, having a frequency of around 3 allows us to inform customers, without them being affected by ad fatigue. Fast food such as Sonic is something that has a very short product life cycle, however our consumers who eat fast food more frequently do not need a proportional increase in ad frequency because they are exposed to the advertising on Sonic Drive-In restaurants more frequently. Sonic does have large number of competitors such as McDonalds, Dairy Queen, Burger King, Arby’s, and Jack-in-the-Box. Due to the large number of competitors, Sonic’s ad frequency must be higher than a more well-established nationwide chain such as McDonalds. Continuity Objectives: Sonic is a restaurant which flourishes in the spring and summer months due to the nature of our dining style. Most all of our restaurants have an outdoor element that involves roller skating delivery service to the customer’s vehicle, making the winter month’s difficult on business. With this in mind, the majority of our advertisements will run more frequently during the spring and summer to increase awareness and drive customers to our restaurants. As a result of this, we will run a pulsing continuity schedule. This will allow our brand to still have a presence year round, while focusing our advertisement dollars most heavily on the primary months of consumption. 14
  • 17. Impact Objectives: Because Sonic as a brand is not as well-known in the regions that the company is planning to expand to, it is important to show prospective consumers what kind of items Sonic offers. With the food items, as well as the service, being rather unique and different from other fast food restaurants, impact is integral in this campaign. Visuals, including color and demonstration, are important, as the former shows the colors of the food items, making them appealing, and the latter to show how Sonic's stands out from other fast food restaurants in terms of service. Sonic is well-known for its commercials with the two men, it would be helpful to use the same type of humor and visuals, making the brand consistent. 15
  • 18. Media Strategy: TV: Sonic has some long standing and recognizable television commercial advertisements, variations of which will continue to air. Sonic consumers do not watch very much daytime television, so our media vehicles will focus mainly on Prime Time TV. The media vehicles we choose will appeal mostly to the target audience we are trying to acquire, parents with multiple children. This target audience is likely to watch programming rated suitable for children such as sports, and prime time dramas and comedies. 16
  • 19. Out of Home (OOH) Media Strategy: Sonic’s advertising media strategy will be heavily focused on Out of Home advertisements. We will place advertisements in places such as billboards, bus stops, train stations, and other creative placements to create awareness for potential customers on the move. This strategy allows our audience to see the advertisements nearby store locations and at point of purchase, which will likely increase the chances of them visiting. 17
  • 20. Radio Media Strategy Radio advertising is compatible with Sonic as a brand and with a variety of factors in buying the media, it would prove to be a successful medium in this campaign. One of Sonic’s USP is the unique drive-in experience that no other restaurants offer: carhops in roller skates come to the car with the order. This experience is reminiscent of the ‘50s and not offered in many other restaurants, much less other national chains. Because much of the radio listening happens during car rides, we want to attract our consumers through our fun and descriptive advertising and give them the call for action, i.e. “Try Sonic’s new item on [the local spot] today!” We want the consumers to associate their car rides with the ads and consequently, Sonic. This may be further strengthened when the ads play around a meal time, as the consumer will be thinking of food and more affected by the appealing words of the ads. We will buy both national and local radio spots; the former will strengthen the fact that we are trying to become a national brand and the latter will strengthen the connection with its local consumers. Digital: App​: The Sonic Drive-In app is currently being promoted. When customers download the app and create a new account, they can receive a free slush or drink. The app allows customers to earn rewards every month and when the “MySONIC” card is reloaded. The app also lets customers check in to pay when parked at the restaurant or in the drive-thru, find Sonic locations and hours, and send digital gift cards to friends. The Sonic app is ranked #24 in the App store and is rated 4.8 stars from about 10,700 ratings. In comparison to competitors, the Sonic app is dominating in high ratings. The McDonald’s app is currently ranked #2 in the app store but only has a rating of 2.4 stars from about 3,570 ratings.Considering how large of a company McDonald’s is, these numbers 18
  • 21. are very poor. The Burger King app has 2.2 stars (208 ratings), Wendy’s app has 2.7 stars (57 ratings), and Jack in the Box app has 4.1 stars (45 ratings). Continuing to promote this app through promotions and making it useful for its customers will help continue brand loyalty as well as attracting new customers. Social media​: SONIC Statistics Facebook: 4,518,486 likes Twitter: 350K followers Instagram: 313k followers Sonic’s strongest social media presence is on Facebook. Promoting an ad to download the app to people near restaurants will give Facebook users incentive to try Sonic. If users already have the app, it will be another reminder about Sonic. Continuing to offer a free promotion with an app download and account creation will also drive people to the restaurant. 19
  • 22. 20
  • 24. Conclusions: In conclusion, we will use a variety of TV, OOH, Radio, and Digital advertising. By integrating a pulsing continuity plan, we can push for more sales in summer but still have our message out all year long. Reaching between 40 to 80% of our target audience over the next year will help us to increase overall market share by 1% (to 9.2%). For the future, we plan to continue growing the popularity of our app and add more locations to the northwest and midwest regions of the U.S. Expanding internationally would also give us more revenue, especially in warmer climates where outdoor American cuisine could flourish. Contingency: For our contingency plan, we are setting aside $20 million for summer spot advertisements. This will allow us to advertise extra when we need it and to push for grand opening announcements of our new locations. These are the primary areas we would use our contingency money for. 22
  • 25. References: Bailey, R. (n.d.). Background and Objectives ComStrat 382 Final Project. Lecture, Pullman. History. (n.d.). Retrieved December 11, 2017, from https://corporate.sonicdrivein.com/history/ SONIC. (2017). Retrieved December 11, 2017, from https://www.sonicdrivein.com/ 23
  • 26. Appendices: Sonic Drive-In App SONIC Drive-In Fact Sheet HEADQUARTERS 300 Johnny Bench Drive Oklahoma City, OK 73104 sonicdrivein.com OVERVIEW SONIC®, America’s Drive-In®, is the nation’s largest chain of drive-in restaurants with more than 3,500 drive-ins serving approximately 3 million customers every day. Over the past 64 years, SONIC has delighted guests with signature menu items, more than 1 million drink combinations, friendly service by iconic Carhops and ongoing support of education through its award-winning Limeades for Learning® program. For more information about Sonic Corp. (NASDAQ/NM: SONC) and its subsidiaries, please visit sonicdrivein.com. Customers can also connect with SONIC at facebook.com/sonicdrivein or on Twitter @sonicdrivein. HOURS OF OPERATION Hours vary by location; however, our minimum hours of operation are 6 a.m. to 10 p.m., unless community standards warrant other hours. During the summer, most drive-ins are open until midnight or later. NUMBER OF DRIVE-INS Sonic has 3,527 drive-ins located in 45 states 24
  • 27. SALES $1,244,000 average unit sales (FY15) MENU SONIC’s award-winning menu offers a variety of unique menu items made after you order. Menu items include TOASTER® Sandwiches (made with thick Texas toast), Footlong Quarter-Pound Coneys, handmade Onion Rings that are sliced, breaded and cooked fresh daily, Tots and a plethora of drink and dessert choices, such as our signature Cherry Limeades, featuring a sweet touch of cherry to a delicious lime thirst quencher. SONIC has more than 1.3 million drink combinations, making it Your Ultimate Drink Stop!® HISTORY Founder Troy Smith Sr. started SONIC, America’s Drive-In as a hamburger and root beer stand in 1953 in Shawnee, Okla., called Top Hat Drive-In. Back then, SONIC revolutionized the ordering process by using curbside speakers that allowed customers to place food orders without ever leaving their cars. This technology spawned the slogan “Service at the Speed of Sound™,” which translated to one word: SONIC. Troy Smith Sr. aptly changed the name from Top Hat to SONIC Drive-In in 1959. The first drive-in to adopt the SONIC name is still serving customers in Stillwater, Okla. PHILANTHROPY While our Oklahoma City, Okla. corporate office focuses on supporting programs that provide educational opportunities for Oklahoma youth ages 4-22 and strong interest in the arts, the SONIC system bands together through Limeades for Learning®, our national cause branding program that provides much-needed supplies and learning materials for teachers to help their students learn. Through Limeades for Learning® in partnership with DonorsChoose.org, SONIC and its franchise partners have donated more than $5 million to public school classrooms in local communities across the country. Visit limeadesforlearning.com​ to learn more about SONIC’s commitment to education. CARHOPS Personal Carhop service is one of many reasons customers enjoy visiting SONIC. Frequently seen spinning by on roller skates, smiling Carhops personally deliver orders right to customers’ cars. What’s more, Carhops check back to ensure a quality experience. Each customer receives a mint with a drink, dessert or meal purchase – a tradition started by company founder Troy Smith Sr. to remind customers they are worth a mint at SONIC. 25
  • 28. FUN FACTS In one year, SONIC: – sells enough tots that when placed end-to-end would circle the globe…TWICE – sells enough Footlong Quarter Pound Coneys to border the 48 contiguous United States – sells enough Cherry Limeades to fill more than 15 Olympic sized swimming pools – gives away enough mints to reach the top of the Empire State Building and back to the ground…5000 times. Media Contact: Investor Contact: Jason Acock Corey Horsch SONIC, America’s Drive-In SONIC, America’s Drive-In (405) 225-4828 (405) 225- 4800 Taken from Sonic’s website at: ​https://corporate.sonicdrivein.com/fact-sheet/ 26