Responsible for one of the catchiest, ubiquitous jingles in recent advertising history, Subway’s “$5 Footlong” campaign can trace its roots all the way back to 2008. When news broke recently that Subway was moving to a new $6 foot-long promotion, industry pundits quickly questioned the wisdom of another price-point-based strategy, especially with the $5 price so deeply burned into the public consciousness.
We went straight the the U.S. consumer population and asked. Here’s what we found:
Our sample of over 2,300 US adults found that a full 23% of consumers expect to reduce their visits to Subway as a result of the new $6 price. Look what happens to the numbers when we remove people who never eat at Subway anyway:
Over 1/3rd of Subway diners say they will eat there less. Now, in all fairness, we do know that people tend to overstate their displeasure with price increases, relative to their eventual behavior. But even at 20 or 25%, that’s a lot of potential attrition.
Among Subway diners only, 44% of Millennials say they will patronize the establishment less due to the new price. Again, are some of these respondents just bitter and likely to suck up the extra $1 the next time a Subway is the most convenient place to eat? Probably. But not all of them.
I’m sure the smart people at Subway know what they’re doing. You can’t blame them for raising prices. The fact that they held steady at $5 for nearly 8 years is impressive in its own right. So, I’m sure they have other strategies for wooing their loyal diners, especially the younger ones. We know from our other research that Millennials value speed and atmosphere in their restaurant choices, as well as the portability of food items – things they can eat with one hand while staring at their phones. Perhaps we should look for those kinds of moves from Subway in the future, especially if this $6 footlong promotion falls flat.