Sales slump has Subway scrambling for technology

Competition in the market gets chain thinking high-tech

CHICAGO— Subway Restaurants, facing one of the worst slumps in its history, is hoping to win back customers by losing its low-tech image.

The sandwich chain is introducing touch-screen ordering kiosks and a new mobile app — a bid to catch up with places such as Panera Bread Co., which have credited technology with helping fuel sales.

Subway is even testing dedicated pickup areas for mobile orders, shaking up the five-decade-old format of its restaurants.

It’s a major overhaul for a chain that hasn’t been known for its technological prowess. Until about a decade ago — when Subway was still booming — its customer-loyalty program relied on sticking stamps on paper cards. But these days, Subway is reeling from a three-year U.S. sales decline and fast-food competition is tougher than ever. That’s put pressure on the chain to be quicker and more convenient.

“It’s really a vision and strategy in how we want to evolve,” said Carman Wenkoff, Subway’s chief information and digital officer. “Customers are demanding a more complete experience.”

The company, which has more locations than any other restaurant chain, is also adding digital menu boards and bringing Wi-Fi to some locations. The move is a response to competition on several fronts. Traditional fast-food chains are upgrading their equipment and embracing more natural ingredients, robbing Subway of its edge in the healthyeating arena. Mom-and-pop eateries and prepared meals from grocery stores also are taking market share.

Subway’s U.S. sales fell 1.7 per cent last year to $11.3 billion, marking the third straight annual decline, according to research firm Technomic.

Earlier this year, Subway confirmed that it was closing hundreds of locations, marking the biggest retrenchment in its history.