Sandy Springs-based Arby's is on a drive to make its food more attractive to keep customers from migrating to competitors such as Wendy's and McDonald's.
Nearly two months after Arby's was sold to Atlanta private equity firm Roark Capital Group, the chain known for its roast beef sandwiches and curly fries says it is improving the perceptions of its menu. But there is much work to do.
A recent Consumer Reports survey gave Arby's low scores for taste. Arby's ranked at the bottom of 11 sandwich and sub chains. Firehouse Subs, Jason's Deli and Jersey Mike's Subs topped the list.
Recently, Arby's gave The Atlanta Journal-Constitution access to its test kitchen and top executives to discuss planned upgrades. On a table spread were the makings of a not-yet released Philly cheesesteak, which will go on sale in October. It's the third in a line of Angus sandwiches priced at $4.99.
The sandwiches "really changed how people thought about Arby's," said chief marketing officer Steve Davis.
Arby's executives say the company's turnaround gathered steam in the last quarter of 2010. In the first quarter of 2011, sales at Arby's restaurants open at least a year rose 5.5 percent in North America. The company's results were boosted by a dollar menu, a marketing campaign called "Good Mood Food" and the launch of the Angus Three Cheese & Bacon Sandwich.
Arby's is emphasizing Angus beef to capture higher profits and attract diners that might otherwise go elsewhere. Just months after the Angus sandwiches were put on the menu, they account for 8-9 percent of Arby's overall sales. Davis predicted that, with the introduction of the Philly cheesesteak, that number could rise to 12-15 percent.
Arby's is also relaunching its Market Fresh line of sandwiches, this time with whole-wheat flatbread.
"We're really trying to hit that sweet spot of someone who loves the taste of fast food but doesn't want all the calories," Arby's president Hala Moddelmog said in a July interview.
Arby's needs to clarify what its brand stands for, said Barney Wolf, a freelance food writer in Ohio who has covered Arby's for QSR, a magazine that follows the fast food industry. Competitors such as Subway have already done so.
"Quality is not always the issue with Arby's -- I just think a lot of people were confused about what the brand is," Wolf said. "I don't know if Arby's has always lived up to its price point in terms of what customers expect. How is your $5 sandwich that different from what other people are offering?"
Meanwhile, the company is promoting a spiced-up chicken sandwich. Arby's has offered chicken for some time, but wasn't very competitive, Davis said.
The company also hopes for bigger things from its snacks such as jalapeno poppers, fruit turnovers and steakhouse-style onion rings. It is testing a sweet potato product in a bid to grab consumers who want healthier options.
"Consumers are eating throughout the day," said Brian Kolodziej, vice president of product development and integration. "We think there's an opportunity for items that are portable, easy to eat and craveable."
Sometimes to the consternation of analysts, Arby's often waits for other companies to experiment before trying its own version of dollar menus or Angus sandwiches. Arby's executives acknowledge that it takes a certain swallowing of the ego to wait and let McDonald's or others move first.
"We have the strategy of being a ‘fast follower,'" Davis said. "Let someone create a category and then come in and do it better."
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