Sonic CEO Clifford Hudson believes that technology initiatives the company has embarked upon will help drive customer engagement, particularly among millennials.
“In earlier quarters as we were installing the point-of-sale system and some real challenges in the implementation and adaptation on the part of our operators, there was some disruption and, yet in this most recent quarter when we looked at SRI versus franchisees in like markets, we saw a gap begin to open up and it improved as the quarter went along exclusive of periods of rougher weather,” Hudson said during the company’s June 22 third-quarter earnings conference call, according to Seeking Alpha. “So our confidence that these strategies will continue to play very well for us, the upside should be very significant and we continue marching through the year, ‘15, ‘16, and ‘17 with the implementation in a way we think will be very positive for our business. We’ll do so in a variety of ways that over the next several years one of the things that's going to have the most positive impact is the series of technology initiatives we have, some of which will help the drive-In manage the business better and others will help engage the consumer more effectively, particularly a millennial consumer in their use of 21st Century forms of communication beyond what their parents have utilized you might say.”
In the next three years, Hudson said Sonic plans to move to non-television forms of digital media and customer engagement, “the integrated customer engagement or ICE as we call it. We are in our early phases on a pilot of a customer relationship marketing or rather management program. Our day-part strategy is also aided by POPS (Point of Personalized Service) and day-part appropriate presentation at store level when customers do come on a lot, Drive-In profitability positively impacted by the implementation of a new point-of-sale system, and, in turn, as that profitability picks up, new unit growth should continue on in a very positive way upward. We now have POPS in something more than 900 stores, and we have software-based point-of-sale systems in something over 1,100 stores. So we continue in this rollout.”
According to a Frank Mayer and Associates study, POPS systems increase customer loyalty. Sonic’s POPS system adds targeted messaging and customized promotions using mobile technology and social media.