In its first significant move under new ownership, Quiznos this week launched a new “Better Than Ever” menu and branding campaign to help revitalize the sandwich chain’s positioning.
The goal of the rebranding is to differentiate the sandwich chain with better ingredients and unique flavors, according to the company.
“We’re going after high-quality ingredients, more meat in our sandwiches and unique Quiznos’ recipes, which was really what the company was founded on: things you can’t get anywhere else,” said Greg MacDonald, Quiznos’ chief executive, in an interview with Nation’s Restaurant News. “You can’t get them at Subway and you can’t get them at some of these casual dining chains.”
Ingredient improvements include a switch to all-natural chicken, Angus beef and upgraded turkey. Breads now include a garlic focaccia.
Signature favorites remain on the menu, but Quiznos has added more than 25 new items, many of which are less than 500 calories. A centerpiece of the new promotion, for example, is a new Chicken Milano sandwich on rosemary Parmesan bread, with mozzarella, a three-cheese Italian blend, seasonal lettuces, tomatoes, and smoky sundried tomato and basil pestos.
Gone are the Sammie, Bullet and Torpedo sandwich lines. The new menu includes more wraps, salads and new grilled panini flatbread offerings, as well as a new line of Sub Sliders, smaller renditions of the traditional subs on a sweet brioche bun.
With the new menu, guests can now also create their own sandwiches, choosing certain proteins, cheese and dressing – something Quiznos didn’t offer before, MacDonald said.
The menu rollout to the chain’s 2,700 restaurants in the U.S. and Canada was accompanied by a refresh of all locations, including a deep cleaning, new furniture and repainting. In addition, employees will get new chef’s jacket uniforms this week, designed to reflect the chain's new culinary emphasis.
MacDonald said the company has supported the effort with about $40 million, largely for advertising, but also to help franchisees with remodeling and new uniforms.
The cash comes from new owners, Avenue Capital Group, a New York-based hedge fund that spared the Denver-based chain from near bankruptcy with a debt-for-equity swap earlier this year.
The restructuring deal, which closed in January, eliminated about one-third, or $300 million, of the company’s estimated $870 million outstanding debt. Avenue Capital also injected about $150 million in new capital, taking a majority stake in Quiznos.
In February, Harsha Agadi, former chief executive of Friendly’s Ice Cream LLC, was named executive chair of Quiznos’ board, along with several other new board members.
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MacDonald said the brand relaunch has been in the works for about 18 months, and the new board is fully behind it.
With the new menu, prices have increased almost 2 percent, he added. The increase was based on advice from a “price elasticity” firm hired to evaluate pricing over the past five years and regionally.
“Yes, pricing is going up 2 percent, but we strongly believe value is being improved because we’re also increasing the amount of food in our sandwiches and upped the quality of ingredients,” MacDonald said. “The difference between (price) and what the quality and the recipes are, through our research, drove very strong value scores for us.”
The new menu is being supported by a new advertising campaign with the tagline “Qrave Quiznos,” which marks a “significant increase” in the chain’s media spend, MacDonald said.
Television commercials focus on the craveability of Quiznos items. In one, a sleepwalker dreaming of the Chicken Milano sandwich repeatedly bangs up against the glass door of a restaurant, for example.
Watch a commercial from the new campaign; story continues below
The relaunch also included a focus on customer service. Most restaurants were closed for up to half of a day to retrain staff on the new menu and improving the customer experience, MacDonald said.
Additional online and in-store training has also been made available to further support franchisees. And the chain now has additional field managers at a ratio of about 1-to-30 locations. Previously the ratio was about 1-to-45, he said.
Keith Rentschler, president of the Quiznos Franchisee Association, or QZFA, and a franchise operator in St. Louis, Mo., described the brand enhancement as “all positive.” He said the association applauds and thanks the new ownership “for making the financial commitment to attempt to put Quiznos’ name back on the map."
However, Rentschler added, the rebrand does not impact the chain’s fundamental business model, which franchisees have described as “broken.” Profitability remains “elusive,” he said.
“The system must step back completely from what they have been doing for years and find a way to truly and honestly recognize the franchise owner as their number one asset, and do everything in their power to grow sales, reduce expenses and make the franchise profit-and-loss statement their absolute only priority,” said Rentschler. “Until this commitment is made on all fronts, the health of the brand will continue to suffer.”
Kevin Tackett, one of the chain’s largest franchisees with eight units in Florida, said it was too early to gauge customer response to the new menu and advertising. But he said he is “cautiously optimistic.”
Quiznos has roughly 2,200 locations in the U.S. and 650 internationally. MacDonald said the company will push international growth this year and plans to open about 100 locations overseas, with Brazil and India as key markets.
MacDonald said he was also pleased with domestic development, though he did not specify opening goals in the U.S. “It’s a great time to grow right now domestically,” he said. “Unemployment has actually helped us because there’s a demand from people who want to buy a franchise and we have one of the lowest turnkey costs in the industry right now.”
MacDonald said the chain’s “next-generation” design, which new stores have this year, is slightly more upscale, but turnkey opening costs are around $175,000. “That, against our competition, is a strong selling point for us,” he said.