Answer the following questions in their entirety providing sufficient details: 1. Which two corporate-level strategies d

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Answer the following questions in their entirety providing
sufficient details:
1. Which two corporate-level strategies do you find most relevant
to Sonic’s model (no
matter if they use them or not at the moment or in the past)?
Explain your answer.
2. Which business-level strategy does best fit to Sonic’s model (no
matter if they use it
or not at the moment or in the past)? Explain your answer.
3. Which two functional-level strategies/tools do you find most
relevant to Sonic’s model
(no matter if they use them or not at the moment or in the past)?
Explain your answer.
• Your document should also have an Introduction and a Conclusion.
Sonic Drive-In Restaurants
The fast-food industry is one of the most competitive industries to
enter in the entire world. Why? For one, established
chains dominate the market and newcomers are often shunned for
their inability to relate to customers with
longstanding ties to other brands. This sample case study explores
how Sonic Drive-In management consistently has
its work cut out for themselves; the company is one of the smaller
competitors in the fast-food industry but continuously
maintains a stronghold because of its well-established niche in
offering an “eat in your car-centric” service.

Sonic Drive-In: A successful chain?

Over the last forty years, and regardless of the health risks
associated with fast food, these chains have infiltrated
every nook and cranny of American society. And now the industry is
firmly placed within the global society as well. With
so much money at stake, and with the vast array of competitors -
just look out the window on a long stretch of highway
and you will see the giant illuminated signs of dozens of fast-food
chains vying for the top spot - one wonders how
some of the smaller competitors, such as Sonic Drive-In, can stay
afloat in this industry.

In 1997, Americans spent over $100 Billion dollars on fast food
alone. However, this powerful industry is relatively new.
In the 1970s, fast food restaurants were few and far between. But
when the Women’s Liberation Movement swept the
nation, housewives and single ladies put up their aprons and joined
the workforce. In 1975, a third of American
mothers work outside the home. Today that number has doubled. The
stereotypical atomic family, where dad earns the
money and mom cooks the pot roast, has been upended. Now the
American family relies on automated systems and
low-wage workers to do the cooking (Schlosser, 2012).

Hundreds of millions of dollars annually, per each restaurant
brand, are spent on advertising. That adds up to billions of
dollars spent each year on advertising alone by the fast-food
industry. This is done to maintain companies’ current
consumer base and, now also increasingly, to groom their
up-and-coming consumers, i.e., children, with ads that
promote familiarity and a positive association with the brand (see
TV ads geared towards children and the problem with
inequality) (Mayo, 2009). From 2003 to 2009, fast food ads viewed
went up twenty-two thirty percent among pre-school
and school-age children (fastfoodmarketing.org).

Fast food marketing and advertising is no joke

So, who are these consumers who are so heavily advertised to?
Common thought is that low-income people eat at fast
food restaurants because their prices are the lowest among the
options available to those who wish to dine out. But
according to a recent article in Time Magazine, researchers from
the University of California, Davis found that fast-food
restaurant visits increased commensurately with an individual’s
income. And they also found that these visits tapered
off once an income reached approximately $60,000 annually. The
middle class is the main consumer of fast food. The
study authors described the typical fast-food consumer as: “A
lower-middle income head of household, who is budget-
conscious and harried and likes the convenience and low price of
fast food, compared with other restaurants” (Melnick,
2011).

The above information regarding fast food consumer demographics is
interesting when compared to their target
advertising market of fast-food restaurants. According to
reuters.com, a 2009 report revealed that fast food
restaurants
are stepping up efforts to market their products and brand name to
children. Jennifer Harris of the Yale University Rudd
Center for Food Policy Obesity in Connecticut spent a year studying
12 of the largest fast-food chains with colleagues.
She and her team documented the fast-food buying habits of children
and teens, and the advertising habits of these
fast-food chains. “Despite pledges to improve their marketing
practices, fast food companies seem to be stepping up
their efforts to target kids,” said Harris (Fox, 2010).

The role of children in a successful fast-food brand

The marriage of the target market and the average fast-food
consumer is a wholly perfect union. Children and teens
are among the largest demographic with readily available spending
money and the middle-class head of household,
attracted by the low pricing, is available as a source to provide
the products that these target market kids have been
seeing on television. That is not to say that kids are the only
demographic advertised to in the fast-food industry, as
women are unfairly represented in advertisements as well, but
this practice is definitely rife among some of the larger
chains. There are only so many dollars out there and based solely
on the previously mentioned advertising budgets
alone, the competition is fierce.

Sonic's early start in Oklahoma

Among the sea of chains in the fast-food industry, Sonic Drive-In,
the nation’s largest drive-in chain, has maintained its
position with only a recent slight dip. According to the Sonic
website, Troy Smith opened the first Sonic Drive-In in
Shawnee, Oklahoma in 1953, but back then they called it Top Hat.
Troy had always been interested in becoming a
“real” restaurant owner. He had an old burger shack on the same lot
as his restaurant that he never really got around
to tearing down and it just sort of grew from there. People would
order from the walk-up window and eat in their cars.
He got the idea to add an intercom system and car-canopy, and the
first version of the modern Sonic was born. Once
he and his partner found out that the name “Top Hat” was
copyrighted they came up with the idea of “Sonic: service at
the speed of sound,” and the rest was history.

One of the features that keep Sonic ahead of the competition is its
dedication to maintaining the Americana authenticity
of the car-hop experience. Not only did the chain develop
innovative advertising techniques in the drive-in concept,
but
it kept them up to standard through the years. Carhops still
deliver food prepared-to-order right to the customers’ cars.
In addition to that, Sonic has kept its classic menu of burgers and
shakes that its customer base has come to love
(sonic.com).

But not all of Sonic history was golden. According to an article in
QSR Magazine, Sonic CEO Clifford Hudson
redoubled the company’s efforts to strengthen the brand after the
company had some major losses in sales. There was
a sales decline of over $200 million from 2009 to 2010 after
experiencing a steady gain for 22 consecutive years. Food
standards were raised (better burgers and “real” ice cream), new
items were offered to add menu diversity, customer
service was strengthened, and these changes were broadcast to a
national audience (Smith, 2012).

Sonic's new measures to ensure success

In addition to quality improvement, a new advertising agency was
hired. And contrary to the standard bright and shiny
fast-food advertisements that worked at appealing to kids and
teens, the Sonic ads had bland colors and camera/film
quality, and featured two paunchy, middle-aged men goofing around
in their car while enjoying Sonic products and
being amusingly ironic and silly. The advertisements were so
popular that even after the ad campaign ended, the two
guys decided to “go rogue” and continue making Sonic ads on their
own in an attempt to gain support in petitioning to
get their old jobs back. The plan worked. People identified with
the “working-stiff-as-underdog” concept (Newman,
2012).

Sonic also has various other marketing and media programs in place
to expand its brand beyond its usual base of
customers. The Oklahoma newspaper Ardmoreite reported on the
charity donation to education programs that Sonic
helped raise funds for through limeade sales (Lindsey, 2012). And
Self Magazine included a mention of Sonic’s French
fries in a feature that highlighted low-calorie ways in which the
guilty-pleasure could be enjoyed guilt-free (Clarke,
2012). In the limeade sales fundraiser, we see Sonic giving back to
the community while also strengthening its own
brand - no other fast-food chain does limeade. And in the French
fries feature we see a commitment to the history of
Sonic (burger and fries). But in this we also see a dedication to
ensuring excellent food quality (since the fries landed
on a best-of list) and a branching out into newer territories
(i.e., the “healthy” French fries).

Reflecting on Sonic's business development

When all of the above information is considered, it becomes clear
how Sonic has consistently maintained its place
among the extremely competitive world of the fast-food industry. It
branded itself almost from the moment of their own
inception; and executives kept to that brand. Executives also made
sure to strengthen the brand and up the quality
during periods of decline - thus going back to what made it a
success in the first place (i.e., being very good at being
unique and delicious). As discussed, new things are added from time
to time, but never in such a way as to detract
from Sonic’s “Sonic-ness.” In addition to this, Sonic was able to
capitalize on the historic aspect of the drive-in
restaurant that it helped to define, becoming a part of Americana
history and a destination all on its own. Sonic is
uniquely itself.