Arby's brand president and marketing boss Rob Lynch realized shortly after joining the fast-food chain famous for those stacked-to-the-ceiling roast beef sandwiches that he had his work cut out for him. Standing at the counter of one of his restaurants one afternoon, Lynch recalls, he overheard a customer remark: "Arby's makes really big, meaty sandwiches—I wish they had a chicken sandwich." And yet right there on the menu board were four chicken sandwiches.
"We were hiding in plain sight," Lynch says of the 52-year-old, Atlanta-based company, which, after years of a brand identity crisis, a revolving door of ad agencies and slumping sales, has been busily remaking itself to appeal to a broader swath of consumers—notably younger ones, fast-food's core customers—while staying true to the founders' mission of offering fare that's unlike anything else out there. Lynch sized up his company's issues bluntly at the annual Association of National Advertisers' Masters of Marketing Conference in Orlando last October. "Our customers were not loving Arby's for a very long time," he told the group. "We had lost about $150,000 in sales per restaurant over a four-year period, which for a brand of our size is essentially catastrophic."
Lynch with CEO Paul Brown at the new store in New York.
But since he came aboard in October 2013, Arby's, with 3,300 stores worldwide, has made a number of high-profile changes to its marketing recipe that have dramatically enhanced not only the look and taste of the brand but also its prospects. Right away, Lynch ordered an agency review, and just three months into his tenure, the company tapped a new creative agency, Publicis Groupe's Fallon, Minneapolis. The agency's CEO Mike Buchner commented at the time that he wanted to "get Arby's back into the conversation." That it did, launching Arby's "We Have the Meats" positioning and executing a brilliant promotion around Jon Stewart's retirement as host of Comedy Central's The Daily Show.
Previously, the marketing message was scattershot. The chain's "Slicing Up Freshness" tag, created by its former agency, MDC Partners' Crispin Porter + Bogusky, failed to move the needle. About Fallon, Lynch says, "We felt like they were going to be our partners in building something special."
Also under Lynch, Arby's would be responsible for one of the most talked-about marketing executions in recent years, when, on the night of the 2014 Grammy Awards, it tweeted about Pharrell Williams' hat and how much it looked like Arby's own brand icon—a message that got retweeted some 80,000 times and that generated 6,000 new followers for the brand.
Most importantly, the company that just a couple of years ago saw business stall has experienced a mighty turnaround, with same-store sales growing 9.6 percent in the third quarter of last year. (July and August were the best months in its history.) It was the 11th consecutive quarter the chain outperformed the quick-service restaurant category, per NPD Group.
Arby's is in good company—fast food is on a roll these days. Despite the trend toward healthier eating and a barrage of negative press concerning fast food's role in the obesity epidemic, sales for the three leading burger chains—McDonald's, Wendy's and Burger King—were all up in 2015, with each poised to report stronger year-end earnings, according to analysts. While there was some initial grousing among franchisees, McDonald's all-day breakfast menu turned out to be a big hit with consumers—aiding a 3.5 percent uptick in same-store sales in the third quarter, its best showing in four years. More recently, McDonald's and Wendy's have been competing for price-conscious consumers by tweaking and promoting their dollar menus.
Arby's has been on a roll since Lynch came aboard.
Lynch was not unfamiliar with the plight of a fast-food brand in need of a refresh prior to joining Arby's. His previous job was as VP of brand marketing at Yum Brands' Taco Bell, where he earned accolades for taking a chain that was hemorrhaging business and igniting consumer interest with innovations including the most successful launch in the company's history, Doritos Locos Tacos. (Last week, Taco Bell promoted chief brand engagement officer Marisa Thalberg to CMO, replacing Chris Brandt, who left the company. Earlier this month, Taco Bell, in a clever press release strewn with heavily redacted copy, promised to unveil "what could be its biggest food creation yet" in an ad by Deutsch LA during Super Bowl 50. Taco Bell returns to the game this year after three years of sitting out.)
"What I saw in [Lynch] was a person with a great marketing pedigree but also a real ability to think creatively about the business, because I believed very strongly that if Arby's was going to get where it needed to go, we had to think differently," says CEO Paul Brown, formerly a top executive with Hilton and Expedia who had been at Arby's just three months before he hired Lynch. "We could not do things the way that other companies in our space did things."
If you haven't been inside an Arby's lately, you probably wouldn't recognize the place. Last year, the company opened 60 new U.S. locations and remodeled 100 more to institute a look more aligned with that of a fast-casual restaurant like Panera Bread or Cosi than the typical fast-food outlet—a more stylish, upmarket feel, with lots of wood and subway-tiled walls and retro light fixtures. ("The menu is a great way to tell a story. The interior is a great way to reinforce the story," says Kate Edwards, a food industry consultant.) Hundreds more new and remodeled sites are set to open this year.
No doubt, Arby's highest-profile opening was this past December, in midtown Manhattan, a few steps from the heavily trafficked area around Madison Square Garden and Penn Station. It had been nearly a decade since the company had an outpost in New York.
Realizing that the way to the heart of a journalist is through his or her stomach, Arby's, just prior to the store's grand opening, rented a bus and took food writers on a "meat tour" of New York that included the legendary Katz's Deli on the Lower East Side and the Old Homestead Steakhouse. The tour ended at the new Arby's, where reporters and bloggers were served Smokehouse Turkey and Brisket Sandwiches and Corned Beef 'n Cheese Sliders. The sliders were an especially popular addition to the menu. Arby's introduced the mini sandwiches—made with one's choice of meat, including corned beef, ham or jalapeño roast beef—on Aug. 31 of last year. By the end of September, it had sold 29 million of them nationwide—equal to the weight, Arby's boasted, of five Statues of Liberty. Among other new items are the Mega Meat Stacks, Steak Fajita Flatbreads and Loaded Italian Sandwiches, plus a "loaded"—as in with cheese, bacon and ranch—version of its famous curly fries. Fish and Angus steak sandwiches, wraps and salads are also featured.
Arby's was not the only fast-food chain to make a splash by entering the New York market lately—the other being Chick-fil-A last October. (The store voluntarily shut its doors Dec. 30 after being cited by the New York City Department of Health for code violations—including the presence of fruit flies—but reopened Jan. 5.)
For Arby's, like any brand, setting up shop in the country's media capital has obvious benefits. But the chain might never have moved into the market had it not been for the taunts of a certain late-night television host.
Beginning around the time Lynch joined the company, Arby's, as luck would have it, became a favorite punch line of Jon Stewart on The Daily Show. Among his more pungent broadsides: "Arby's, the meat that is a dare for your colon." "It's like if a stomach could get punched in the balls." "Technically it's food."
Instead of getting its back up over the bewildering assault, Arby's and agency Fallon decided to play along. Every time the host would lob a verbal grenade, Arby's would send him and his staff lunch. Over time, Arby's would build a friendly relationship with the Daily Show staff, and when Stewart announced his retirement, Arby's gamely tweeted him a link to its job site. The following night, Stewart spent the first five minutes of his show talking about it, calling Arby's "a worthy adversary."
Then, when it came time for Stewart to sign off last October, Arby's and Fallon crafted a pair of farewell ads timed to his finale, including a 60-second integration—dubbed "Thank You for Being a Friend," set to the Andrew Gold tune and theme song of The Golden Girls—featuring some of the comic's more brutal barbs. ("Not sure why," went the kicker, "but we'll miss you.") Stewart introduced the piece—as Lynch and Brown both sat in the studio audience, right on the front row.
"We truly believe that people were getting the joke, and they did," recalls Lynch. "Almost zero negative conversation about that. So that to me is indicative of a brand that knows who it is, knows who its customers are, knows what kind of relationship we have with our customers and are willing to take chances."
Lynch notes that the back-and-forth with Stewart even contributed to Arby's decision to enter New York. "We feel like this is a place where there's an energy and a vibrancy, and we want to be a part of that, and we want our brand to be a part of that," he says.
Opening a Manhattan location and trading cracks with a late-night host are certainly a long way from Arby's roots. When Leroy and Forrest Raffel—aka the Raffel brothers, or "R.B.," hence "Arby's"—opened their first restaurant in Boardman, Ohio, in the summer of 1964, it served roast beef sandwiches (for 69 cents apiece), potato chips (those distinctive curly fries wouldn't come until 1988), the soon-to-become-legend Jamocha Shake and Texas-size iced tea—a radical menu at a time when burgers were pretty much the only fast-food fare.
But there was another difference.
"Their vision," says Lynch, "was to deliver a higher-quality product that they could charge a little more for, and differentiate from the rest of the industry."
Half a century later, and that differentiation has Arby's back in prime form.
This story first appeared in the Jan. 18 issue of Adweek magazine. Click here to subscribe.