Few commodities are as tricky to navigate as chicken wings. After all, there are only two wings available per chicken, so supply is limited.
Our football-induced obsession with wings doesn’t help the supply/demand volatility. Though pricing instability is for restaurant operators to figure out, figure out they must since we consumers hanker for wings year after year after year. That’s especially true this year, with wings servings up 5% from the prior period, according to the NPD Group.
As we transition into November, and into the throes of football season, chicken wings are yet again taking flight. Just take a look at Wingstop as an example. Earlier this week, the company reported a 12.3% increase in same-store sales for Q3, the highest comps in the industry thus far (and by far).
David Portalatin, NPD’s vice president, food industry adviser, said Americans have consumed nearly 1 billion servings of wings this year (942.5 million servings).
There are a few reasons for this growth. The wing category is changing and blurring and innovating in a way that it’s never quite done before. Namely, there are more wing concepts—Wing Zone, Wingstop and Buffalo Wild Wings among them. These players are relatively new compared to some of the legacy brands in the restaurant space, conceived in 1993, 1994 and 1982 respectively (for context, McDonald’s has been around since 1955).
There are also smaller, yet growing, wing concepts, like East Coast-heavy Atomic Wings, Nashville-based The Wing Basket, emerging Epic Wings, college campus staple Wings Over and more. This doesn’t even count the pizza joints, including Domino’s, Pizza Hut and Papa John’s, that have leaned heavily into wings, and KFC, which just added wings to its permanent menu, a rarity in the QSR category. (Notably, McDonald’s Mighty Wings launch in 2013 was an abject failure).
A growing category combined with innovation (both flavors and cuts) and more accessibility and you’ve got a perfect storm for increased consumption.
“I’ve always believed that there are big, established behaviors in American eating patterns and one of those is that we love wings,” Portalatin said. “When companies in the marketplace do things that are new, innovative, exciting, or there are companies that are building new stores and growing, the consumer responds favorably to that.”
Consumers clearly responded favorably to Wingstop this past quarter. The chain’s same-store sales growth came despite wing prices being up nearly 23% this year. To navigate the commodity headwind, Wingstop launched a national test on whole wings.
“This test is key to our strategy of mitigating the volatility that we see in markets due to the price of bone-in chicken,” CEO Charlie Morrison said during the earnings call. “Overall, we were pleased with what we learned from the test and we’ll use our learnings to continue to find ways that we can leverage purchasing whole birds as a way to mitigate the volatility of wing prices.”
Wing Zone took a similar approach, introducing thigh wings in all of its domestic locations in early August. CEO Matt Friedman said the launch has been successful so far.
“We had high expectations on guest feedback and we are seeing 70%-plus success with two key questions: ‘Would you order thigh wings again?’ and ‘Would you recommend thigh wings to someone you know?’ Each week, we are seeing more and more orders, showcasing continued success of the launch,” he said.
Beyond that customer feedback, Friedman said the company is better able to control costs with the new product.
“We started to explore additional chicken items that were unique and lower cost. Traditional wings continue to be in great demand and prices have been higher this year. Wing Zone locked in a fixed price on traditional wings, so that has had a great impact on reducing food cost,” he said. “Chicken thighs, consisting of dark meat, are approximately 50% less than wings. We have been able to reduce our food cost by 2.5% through innovation and increased buying power.”
Friedman adds that Wing Zone’s research shows it is the only wing-themed restaurant to offer a thigh wing.
“I believe this is the most innovative menu item we have launched in our 26-year history. I cannot recall a menu item being in research and development for this period of time,” he said.
Portalatin does question use of the word “innovation” when it comes to these types of approaches, but admits the newness of products like thigh wings will turn on plenty of customers nonetheless.
“It’s the same with boneless wings. Are they truly under the banner of innovation? Maybe it’s not the right word, but the American consumer loves to try new things especially if we’re already familiar with it,” he said. “We love wings. We always have. If you give us new flavors, forms and shapes, we’ll try it.”
He adds that restaurant operators are forced to think beyond the traditional wing because of the supply chain squeeze.
Still, wing innovation extends beyond cost cutting/supply chain opportunities. Chicken is certainly a versatile protein, and wing purveyors have not been shy in experimenting with new, bold flavors accordingly—something more consumers are demanding. Wing Zone currently has 17 flavors, rolling out one or two new flavors each year. The chain plans to launch its newest flavor, Nashville Hot BBQ, in March 2020 to coincide with the NCAA Basketball Tournament.
KFC already has a Nashville Hot offering for its wings, alongside Buffalo and Honey BBQ. Wingstop recently launched limited-time Ancho Honey Glaze and Harissa Lemon Pepper flavors to add to its 11 original flavors.
These aren’t flavors you’d find from a time machine trip back to 1993.
Wings’ popularity can also be attributed to accessibility. Wingstop has generated a significant amount of investor confidence because of its digital prowess. For Q3, digital sales represented 36% of domestic systemwide sales, pushing toward the chain’s goal of “digitizing every transaction.” Most of Wingstop’s transactions (75%) are takeout orders, and the chain continues to ramp up its delivery capability, with 90% of the system expected to offer the channel by the end of the year.
Meanwhile, 80% of Wing Zone’s thigh wing orders are coming from its online channel, Friedman said.
Speaking of accessibility, KFC now delivers its wings and offers a subscription service for its most fervent fans. That subscription service sold out in about two hours, by the way, underscoring the demand for this product. Further, at just over 4,000 domestic units, KFC’s footprint is significantly deeper than any other wing concept (Wingstop has about 1,110), which means this permanent menu addition and the chain’s quick-service model could very well be a game changer for the wing category and its supply.
“Wings have become popular across all restaurant formats, so it doesn’t surprise me that someone in QSR wants to make a play in this space,” Portalatin said. “The competition is already intense and is getting more intense. But it’s a big enough market for a lot of people to play in.”
Of course, such intensity means there could be supply chain challenges down the road. Perhaps that’s why these new cuts and flavors and channels are, indeed, innovative.
“When there are two wings on the bird, the demand for wings outstrips the ability of the supply chain to keep up. Restaurants are forced to innovate in a way that is outside of a straight commodity wing. We’re seeing that diversity now,” Portalatin said. “It will be important for this innovation to continue for the growth to continue.”
I have covered the restaurant industry since 2010 when I was named editor of QSRweb. I later added fast casual and pizza beats to my portfolio as editorial director of foodservice media. This coverage spanned the gamut of topics that make up the foodservice space, from marketing and customer service, to the supply chain and display technology. My work has been featured in publications around the world, including NPR, Bloomberg, The Seattle Times, Crain’s Chicago, Good Morning America and Franchise Asia Magazine. I continue to serve as a contributor for many publications, including QSRweb, Food Dive, Innovation Leader and the Digital Signage Federation.