Wingstop’s Total Digital Sales Push Past 40%

Need to Know

• Wingstop is bolstering its growth with easy order options in order to cater to digitally-savvy audiences.
• The chicken wing chain is testing pickup lockers, ghost kitchens, and a partnership with a live streaming app to encourage online orders.
• In January 2020, Wingstop’s digital sales passed 40%, up from 35% four months prior.

Analysis

Wingstop is focused on bolstering its digital presence after a successful 2019 that saw repeated gains in digital sales.

Wingstop is a chicken wing restaurant chain with over 1,300 locations across the US and UK. Wingstop currently generates more than 40% of sales via digital channels, which is up from 35% four months prior.

Online success is likely due to Wingstop’s investment in digital innovation.  Learning from Chipotle’s success, Wingstop has begun testing pickup “lockers” that encourage online orders by allowing for quick and easy in-store pickup and reduced wait times.

“One thing we do know is our guests walk in, they have to wait in the queue and their order is sitting there ready, but they can’t get to the cashier to get them processed or even if they’ve already paid for them, they still have to get to one of our cashiers to actually receive the order. So lockers alleviate that congestion, and we have seen [the] benefit of that,” said Morrison. 

In the UK, Wingstop is experimenting with a “dark kitchen” (or ghost kitchen), which is a satellite kitchen designed specifically for fulfilling online orders. 

“More and more of our business is consumed via our digital channels, be it through carryout or delivery,” said Morrison. “I’m happy to say that about 160 of our restaurants have exceeded 50% [of sales through digital channels] and even more have gone over 60%.”

In a unique move, Wingstop launched an exclusive online ordering extension in the fall of 2019 with the popular live streaming app Twitch. The app extension will allow fans to order their meal online without having to leave their favorite live stream, saying “experience is a top priority for our brand.”

Wingstop’s year-over-year cash flow growth is sitting at nearly 22%, over 14 percentage points higher than the national average. Morrison estimates that Wingstop’s total off-premise business totals 80% of sales.