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Wingstop has launched a virtual brand called Thighstop that sells chicken thighs and the brand name … [+]
Wingstop
That success was accelerated by a robust digital infrastructure that became a business case study over the past crisis year. As it goes, several wing concepts have popped up trying to duplicate the same results.
Now Wingstop takes a page from its own playbook to create a concept that places the chicken thigh in the center of the board. Wingstop today announced the launch of a virtual brand called Thighstop through its more than 1,400 locations nationwide.
Boneless bone-in and breaded thighs are available through Thighstop.com and DoorDash and come naked or sauced with a choice of the brands 11 flavors. Thighstop also serves Wingstop’s signature ranch and blue cheese dips, seasoned fries, fried corn and sandwiches. Absent from the Thighstop banner are classic wings, boneless wings and tenders.
CEO Charlie Morrison said this brand hack is a way for the chain to allay consumers’ fears of chicken wings shortages and reduce volatile prices through a whole bird strategy.
It is important to us that we use all parts of the bird. It’s a strategic supply chain plan of ours where we can think about stabilizing prices and positively influencing franchisees PnL (Profit and Loss Statements), while still giving our guests something new and differentiated, he said during a phone call last week.
The launch could also boost material sales. Wingstop began testing bone-in chicken thighs last year, and that test showed no signs of cannibalization of its signature wings. However, a wider rollout did not seem so urgent at the time.
Right now we would focus on making sure we connect with these new guests. We don’t think a new product will necessarily be the answer, Morrison said during the chains Q4 profit call.
But plans change and these particular plans came about quickly which was kind of the point here as the volatility of the wings lingers.
Product launches follow a traditional approach: they hatch in a lab, get an idea, test, test again, and at some point you say, okay, were ready to go to market. That costs a lot of time. In this case, there is a legitimate challenge to the amount of chicken currently available, which negatively affects price, so speed to market is critical, Morrison said. By bringing it to market in a virtual way, we generate speed in the market.
There is clearly a link between that lack of chicken availability and price volatility. chicken wing prices have doubled largely because the same workload that affects the entire restaurant industry also affects poultry farms. For example, there were more than 200 job openings at a chicken processing plant in Georgia, but fewer than five people applied, it said. The Atlanta Journal-Constitution.
We need human capital to grow our offering. Volumes have generally fallen because they cannot hire enough people to run factories. In some factories, they shut down entire lines, Morrison said. It’s not just the restaurant industry influencing its microchips that affect auto sales, equipment and stainless steel. It is everywhere.
Morrison expects this workload to correct itself somewhat by September, when the extended unemployment benefits come to an end. In the meantime, he’s not worried about the potential for additional volume from Thighstop affecting the Wingstops workforce.
This product fits perfectly, seamlessly, into our standard operating procedures. It has the potential to increase volumes, but even with the workload and limited staff, they were fairly isolated, he said. Our grid sizes are small. We have a $2 million restaurant with only five or six people on the line.
Meanwhile, franchisees see the launch of the thigh as a game changer, Morrison adds, due to their ability to moderate those volatile prices.
It takes 280 million chickens every year to satisfy our supply chain. With thighs, the approach has been to accelerate testing very quickly and ramp up the volume of the product and take that to suppliers to implement. That has an impact on food costs and takes some of the pressure off, he said.
It seems like a victory over paper-seamless operations, cost savings, a differentiated product. The question is there, too, Morrison said. While dark meat chicken thighs are much more common outside of the US, including Europe and Asia, they are gaining more attention in the US as demographics change and our taste buds diversify. For example, according to a report from CoBank, millennials are more exposed to dark meat chicken, while growing Latino and Asian populations prefer it to white meat. According to the report, since 2000, the market share of white breast meat has fallen from 66% to 45%, while dark leg meat has grown from 12% to 30%.
Morrison said technology has also played a part in finally getting their deserved thighs in the US
The leg quarter has long been disrespected in the US, while it is one of the favorites abroad because that darker meat has more fat, is juicier, tastier and cooks better, he said. We have raised our culture in America to prefer the white meat product. I think it’s hard to get a grip on dark meat and thighs in particular. But machines that debone the thigh and make the whole muscle available for boneless products and strips, as well as the bone-in product, are starting to help it gain the respect it deserves.
There’s also an important digital piece here that works in Wingstops’ favor and is worth mentioning. The thigh options are only available through the new native digital channel and exclusive delivery partner DoorDash. Currently, Wingstops digital channels make up 65% of all sales and they will hold that level even as the dining rooms reopen.
Morrison wants to bring the chain’s digital transactions to 100% and launching a virtual brand through its existing digitally savvy brand is one way to get there.
Switching to a digital model becomes real value. Those transactions lead to a much higher check for at least $5 more because people tend to spend more time with the menu, he said. We think we can take this 65% further [Thighstop]. It is a powerful statement for the future.
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