The Power of an Offer: Subway's "$5 Footlongs"

[quiescen]

Hello Fellow Warriors,

Have you seen Subway's commercial for $5 footlong sandwiches? If you haven't you're missing out on a great marketing lesson ... the power of an offer!

Now, why is this offer so good? One word ... value! When I think $5 footlong I thing I'm getting a lot for a little. And that's the true power of this pithy little phrase.

Can you apply this to your own marketing? Yes! You see, the offer is really the most important thing on your salespage. You can have a crappy product, but if the offer is appealing enough, people will buy.

Some people will tell you it's your list but I have to disagree.

I don't love Subway sandwiches, but that offer alone made me go in and get one. And this time, I actually liked the sandwich!

[J Elizabeth Dize]

I got one of these $5 footlongs last month. Very good I also got chips, and a drink, and...

It's a great marketing lesson Get people in the door, and bundle them up with a bunch of other things too.

Yum!

[quiescen]

You're right Jenn! There is a "bundling" factor involved. Brilliant again!

[monopuff]

Anytime a corporation tries to portray something as a value I am instantly suspicious. They're not going to make any less money.. They just give you less ingredients ..It's all smoke and mirrors.

[J Elizabeth Dize]

Well, it's not all smoke and mirrors. For example (moving away from subs), if you check out the site thegrocerygame.com, you'll find a bunch of people who use their automated system of figuring out deals and coupons to get items for 60-100% off. Yep...they get tons of items for free. These people get massive amounts of food/toiletries for pennies on the dollar.

That's because corporations have cycles of special deals they offer. Their hope (and the hope of the grocery stores) is that these special deals will get you in the door. If you're savvy (like the grocery game people), you can really make out great...and the companies actually lose money on the deal.

If you're like most people (ME!) and are enticed by the good deal, the company will make out great since you'll likely buy a ton of other stuff too.

The moral of the story is that there are great deals to be had in this world, but marketers usually have another motive in mind, lol.

PS. I used to subscribe to the grocery game, but don't anymore because we eat mostly organic and they don't offer many coupons/deals for those items

[takingaction]

Great post.

Also notice the catchy jingle and how REPETITIVE it is:

5...

5 Dollar...

5 Dollar Foot Long...

So, now you've heard "5" three times and know that it's for a foot long sub. The extra lyric thrown in on one of the commercials is a great little line that clears up any confusion about the deal:

"ANY foot long!"

I wonder what percentage of people that walk through the door only because of this promotion end up "bundling" up. I'm thinking at least 15%. Not bad.

[quiescen]

Takingaction ... yes! The jingle is excellent as well. Gets inside your head and once there, reverberates until you see a Subway and then you hear it again, only internally.

Whoever came up with this marketing campaign should win an award. That offer alone probably already has made Subway many $$$.

[Don Schenk]

Originally Posted by Jenn Dize

Well, it's not all smoke and mirrors. For example (moving away from subs), if you check out the site thegrocerygame.com, you'll find a bunch of people who use their automated system of figuring out deals and coupons to get items for 60-100% off. Yep...they get tons of items for free. These people get massive amounts of food/toiletries for pennies on the dollar.other stuff too.

I had two employees who were following this. They would come to work an talk about the amazing deals the were getting... often time for FREE!

They each carried (in their car) a 3 inch thick 3-ring binder with plastic pages holding their collection of coupons. They had it down to a science.

The corporations really are giving something of value. It is just like warriors giving a product of real value free to have people optin.


:-Don

[VegasVince]

Originally Posted by quiescen

Hello Fellow Warriors,

Have you seen Subway's commercial for $5 footlong sandwiches? If you haven't you're missing out on a great marketing lesson ... the power of an offer!

Now, why is this offer so good? One word ... value! When I think $5 footlong I thing I'm getting a lot for a little. And that's the true power of this pithy little phrase.

Can you apply this to your own marketing? Yes! You see, the offer is really the most important thing on your salespage. You can have a crappy product, but if the offer is appealing enough, people will buy.

Some people will tell you it's your list but I have to disagree.

I don't love Subway sandwiches, but that offer alone made me go in and get one. And this time, I actually liked the sandwich!

Good OP.

A great offer will trump the mediums used to sell it.

In this case the offer comes with built in branding.....a double whammy.

My favorite current campaign.....that rocks on all levels.... is the suave old dude sittin around the table with 3 hot chicks....sayin..."Stay Thirsty....My Friends."

He's pitching one of those imported beers with a funny name and it made me thirsty!

Based on the fact it's being rolled out on a massive level....I suspect sales are going through the roof.



xxx Vegas Vince
Legend.

[quiescen]

I like that campaign as well. But it doesn't beat Subway's offer. The beer commercial is building brand awareness and isn't a bona fide offer. But it's still great!

[JohnMcCabe]

One thing you missed that makes Subway's offer so compelling is that they spent the previous several years selling exactly the same thing for $7-8. Getting the same thing for $5 feels like a great deal...

[Mike Shain]

I have a close friend that works at Quiznos (Mmm... Toasty).

They have people come in everyday looking for the $5 foot longs which ofcourse they do not have.

However in the next week or so they are coming out with their own $5 deals.

Subway was first to market so they have the recognition with consumers.

[Kenneth Fox]

The campaign must be working well as now KFC has
introduced a variety of $5.00 boxed meals.

It seems that Subway set the pace at $5.00 and
I'm sure you will see quite a few fast food chains
follow them.

[JohnMcCabe]

Originally Posted by Kenneth Fox

The campaign must be working well as now KFC has
introduced a variety of $5.00 boxed meals.

It seems that Subway set the pace at $5.00 and
I'm sure you will see quite a few fast food chains
follow them.

Another good marketing lesson...

If you want to compete on price, you'd best be the player with the most chips, because the low-price game sure isn't Solitaire.

[MaskedMarketer]

Originally Posted by monopuff

It seems that Subway set the pace at $5.00 and
I'm sure you will see quite a few fast food chains
follow them.

$5! That's way too expensive for fast food. I prefer the 99 cents menus

[quiescen]

Yeah. I saw the KFC thing too. And they compared their "value meal" with Subway's.

[centextkt]

Originally Posted by MaskedMarketer

$5! That's way too expensive for fast food. I prefer the 99 cents menus

Once again, the whole concept of "value" wins out.

I was a manager with McDonald's in the late 80's when they started their own "Value Meal" concept. What was funny was that many times, the meals were bundled and sold at a cost that was the same as if you bought the items individually. Customers thought it was a great value and bought it.

Value, value, value...

[Michael Forey]

Sure bring them in the door with a $5 sub then sell a $2 cola.

Mike

[JohnMcCabe]

Originally Posted by centextkt

Once again, the whole concept of "value" wins out.

I was a manager with McDonald's in the late 80's when they started their own "Value Meal" concept. What was funny was that many times, the meals were bundled and sold at a cost that was the same as if you bought the items individually. Customers thought it was a great value and bought it.

Value, value, value...

Ah, back in the days when working the counter actually required the ability to make change - or am I going back too far?

Not long ago, I was at a BK and ordered one of the bundled meals on item at a time. The clerk insisted I wanted a "#4", while I insisted it was cheaper to order the items separately. When the shift "manager" noticed the discussion, she came over and insisted the computer was correct even though she watched me add the individual items on a calculator and show her that the sum was less than the price of a "#4".

Meanwhile, the other customers were staring at me like I had two heads - come on, buddy, computers are never wrong. Just order a #4 and get on with it...

Seems I could have it my way, as long as I ordered and paid for it their way...

Normally, I'd just take my business elsewhere, but their smug rudeness ticked me off enough to write to the franchise owner. I got a written apology and gift cards worth five times the original purchase.

When I went back to use them, that manager was wearing a regular uniform and mopping the floor and the computer had been corrected to show the proper price. Oh, and the counter people were much nicer...

[quiescen]

Good for you John! I always email the "right person" anytime I get snubbed by a employee.

[warbar]

Don't know if this a national thing or not, but in Northern New England, Subway has changed up their $5 foot long offer. Oh, they still have several at $5, but if you look closely, you'll see that they are variations of the original subs they were offering for $5.

Pretty smart move.. Run the $5 promo for months, (if not a year) then change the products to a less expensive version. Of course, the full version of original sandwich they were selling for the $5 is still available, but now for $1+ more for the large size

Quizno's waited too long. They did start a $5 promotion here a few months ago, but they should've been on that $5 deal much, much sooner. They've recently began offering a 14" "torpedo" sandwich, which is much smaller product, for $4.

McD's started the whole QSR concept of value meals years ago. Then, after Wendy's came out with it's 99 cent menu, McD's followed suit. They've positioned themselves perfectly. They get the folks who like the bundling concept AND the folks who are on a limited budget. For $3, someone can get a sandwich, fry and a 32 oz. Iced Tea. Total food & paper cost? $1.05. Get enough of 'em in the door and you can still make bucks, even at the lower price points.

Is it any wonder why they continue to out perform all other QSR's during this economic downturn?

A lot can be learned from the examples McD provides in the marketing aspect of their business. Sure, they are a QSR, but after Real Estate, (which is where the majority of their income comes from) their main business is marketing.

[quiescen]

Same thing here in San Diego. Walked in and noticed only "certain" subs were $5. The ham one's pretty good!

[CDarklock]

Originally Posted by quiescen

Now, why is this offer so good? One word ... value!

The first thing I thought when I saw that commercial was "Isn't a foot long meatball at Subway $4.79?"

So I dug out an old receipt, and it was.

They RAISED THEIR PRICES, advertised it like a sale, and people fell for it!

What a bargain! I can pay 21 cents more for my sandwich!

There's a whole different marketing lesson there.

[Nightengale]

Awesome thread! Excellent info.

Originally Posted by monopuff

Anytime a corporation tries to portray something as a value I am instantly suspicious. They're not going to make any less money.. They just give you less ingredients ..It's all smoke and mirrors.

Wrong.

Yes, there are and always will be companies that scam people and try to fool the public. But this thread isn't about dishonest companies. We're talking about honest, long-term businesses and their marketing practices.

Many, many companies offer a great value (i.e. slightly discounted) for a "package" or "bundle" of services. This 1) creates greater revenue for the company since they're selling more than they otherwise might and 2) greater value for the consumer since they're getting a discount on something that they need (like chips and a Coke with their sandwich).

Even if they're not offering a discount per se on their bundles, it's still a good deal because the company is offering something they need (like chips and a Coke with their sandwich). In a lot of industries, customers don't buy products and services because they aren't aware that they're available!

Bundling is an under-utiliized concept in many companies and many companies could use it a lot more often than they do. Dan Kennedy talks a lot about this in his marketing products and seminars. A LOT of money is left on the table by companies who don't offer packages or bundles of products and services to their own customers -- products and services which they could really use.

Entire consulting sessions and marketing plans are built around just creating packages of products and services designed just for a company's house list of customers and thousands and millions of dollars are reaped from such campaigns.

Anybody who's studied marketing for any length of time knows that the very best list of prospects is your own house list of customers. It's a lot less expensive to offer more products and services to your house list than it is to go out and try to get new customers for two main reasons: 1) Your current customers know you, like you and trust you and thus, they're more likely to buy from you and 2) you completely eliminate the cost of acquiring more customers. Bingo!

True, there may be people and companies who don't honestly and accurately represent their offers, but there are truth-in-advertising laws which require companies to represent their offers accurately. And most business-savvy companies realize it's very much to their benefit to be completely forthight and up front with their customers and prospects and so they'll be honest regardless.

Marketing is NOT about scamming people. Companies create offers and put them out there. It's up to you whether or not you respond. Now, if you think they're scamming you if they offer a $0.50 discount and you think they should offer a $1 or $2 discount (which would make it a valid and "real" discount worth anything) then that's a difference in expectation and perception, NOT someone who's trying to scam you.

Next time you think you're being "scammed," double-check to see if you're really being scammed or if it's really a matter of expectation and perception (i.e. you think it's not really a "special offer"). BIG difference.

Michelle

[quiescen]

Originally Posted by Netpiddler

I have a close friend that works at Quiznos (Mmm... Toasty).

They have people come in everyday looking for the $5 foot longs which ofcourse they do not have.

However in the next week or so they are coming out with their own $5 deals.

Subway was first to market so they have the recognition with consumers.

Yep. Now they're offering a $3 sandwich called the bullet. Looks bad. And what's worse, it's very evident that they ripped off the "Subway" offer. Now, whenever I see the Quizno's ad, I think Subway. Bad all the way around.

[Dave777]

Eating out in most restaurants these days is an upselling education in itself with some creative thinking! A little food for thought...
Menu Up-Selling - The Basics of Up-Selling Menu Items
Electronic Retailer Magazine July 2009 – Super Size It

Dave

[JonathanBoettcher]

So much for "Toonie Tuesdays" in Canada... now they've upped the price to "Toonie and a Half but you can't get only 1"

That's from a consumer's perspective.

From a marketer's perspective, I think it's a great bit of work.