Subway has done well despite the down economy thanks to its emphasis on value — with its $5 footlong — as well as health, Jeff Moody, CEO of the Subway Franchisee Advertising Fund Trust, said in a Q&A with Brandweek.
Moody said the $5 footlong has become a multibillion dollar brand in itself. The company will continue to launch new products, such as the new Buffalo Chicken sub, to keep the marketing effort fresh. As the economy improves, or if commodities costs increase, the company may eventually consider raising the price of the footlong to $6 or $7.
Moody also said the company will continue to focus most of its marketing budget on TV advertising but also will increase its digital efforts because more consumers are online.
From Brandweek:
Our marketing spend is tied to sales; it's a percentage as are most in the restaurant business. As our sales go up and we are able to open more stores, the budget will continue to grow. As opposed to some concepts that are closing stores, we haven't grown explosively, but we've still been adding an our sales are growing, so I expect our budget will be up next year. [In 2008, Subway spent $421 million on media, per The Nielsen Company. For the first seven months of this year, it spent $259 million.]
