Subway Shifts Strategy, Ends $6.99 Meal Deal After Underwhelming Sales.
In a recent move, Subway has decided to end its in-restaurant $6.99 Meal Deal earlier than planned due to disappointing sales performance. Starting next Wednesday, the offer will no longer be available in stores but will continue online with a 20% discount through December 26.
The Meal Deal, which debuted in stores on November 3, was intended to boost customer traffic and sales, ultimately benefiting restaurant-level profitability. Despite meeting expectations during market tests, the nationwide promotion failed to deliver the anticipated results, as revealed in a company message to operators on Friday, obtained by Restaurant Business.
Subway’s new strategy involves shifting to a digital promotion, offering customers a 20% discount on any sub, starting Wednesday and running through January 5.
In an emailed statement, Subway emphasized its commitment to swiftly adjusting value offers based on data and feedback, while protecting franchisee profits. “Subway’s approach to value is thoughtful and strategic, leveraging data to balance consumer needs and franchisee profitability,” the company stated. “We continuously test new value platforms to drive profitable traffic and encourage repeat visits.”
This year, value promotions have become crucial for fast-food chains amid weakening customer traffic due to high prices. For example, McDonald’s recently introduced the McValue platform, featuring various budget-friendly deals.
However, value offers can be challenging for franchisees, especially in high-cost markets where set national prices may hinder profitability. Subway has faced significant franchisee pushback over value promotions in the past, with around 7,000 U.S. locations closing since 2015. Some franchisees’ reluctance to participate in value deals has impacted their effectiveness.
Subway hoped the Meal Deal, inspired by similar promotions from fast-food giants like McDonald’s, would appeal to consumers. The company initially expected better performance with national marketing support. However, after consulting with franchisees and analyzing data, Subway decided to end the promotion.
