Time to resurrect our faux stock index of companies with excellent marketing strategies and/or strong competitive advantages. We did OK with the initial Lairig Marketing Index, with three strong choices out of four – LivePerson, Harley-Davidson, and especially Monro Muffler.
We drowned in our fourth pick, Coldwater Creek (which continues to run dry, with a 9% same-store sales decline over the 2011 holiday period). An even performance overall, before we “sold off” the entire index.
Let’s start the resurrection by grandfathering back in LPSN, MNRO and HOG. At great risk, mind you, given the upward 45-degree trajectory all three have realized recently. Buy high, sell higher, hopefully.
Now, let’s add the country’s best kept bars-and-restaurant secret: BWLD. Forgive our calling it a secret, but there are no Buffalo Wild Wings in Manhattan. Just two locations, actually, across the five boroughs of New York City (JFK? Oh dear…).
Yet there are over 800 Buffalo Wild Wings elsewhere, with heavy penetration in Texas and the Midwest “Heartland” states. Each location appears to have roughly 800 TVs, giving new meaning to being “in the zone.”
Who else has been able to take this long, long, long wings “fad” (circa 1980) to such a beautiful extreme? Double-digit growth in just about every metric. Including stock price gain. Last week BWLD jumped 15 points, from $64 to $79. Still higher today, at $84-and-change. We’ll hop on it anyway. The Buffalo Wild Wings marketing strategy looks too good to pass up.
Start with its unbelievably interactive home page. Words can’t do it justice. See for yourself here. You’ll be there for hours.
Our dummy Facebook account provides access to BWLD’s Facebook brand page, which shows a trillion likes, excellent company posts, and a million comments and shares. This is a case study for Facebook engagement.
The company spends roughly 3% of net revenues on advertising. It has held that percentage steady over the past three years of torrid growth – no resting on its laurels.
And this – if BWLD can accomplish what it did during these years of economic craptasticness, just think what it can do when (if) we recover.
Two risks to consider. The biggest is the split in company-owned and franchised operation. At some point, franchisors always reach an inflection point where they need to rethink the balance between the two ownership types. As a corollary, there is always the potential for franchisee revolt as the business gets bigger and more complex.
The second risk is minor, and apparently under the radar: What will happen when fans of Buffalo Wild Wings discover that the company DOES NOT HAVE A SINGLE LOCATION IN BUFFALO !?!?!?!