Technology is essential to powering the flywheel, sustaining momentum, and securing long-term prosperity.
Clifford Hudson and Craig Miller
Throughout the first decade of this new century, I (Cliff) became intrigued by how technology and data could be leveraged to learn more about Sonic’s customers and engage with them in ways that would be difficult for others to replicate, creating a competitive advantage.
At the time, the rapid adoption of personal email, internet access, and electronic payment, along with the emergence of e-commerce, had convinced me that technology would become more essential to powering our flywheel and sustaining our momentum and long-term prosperity. It appeared that technology could enable the next wave of innovation for the brand in preparation for the 21st-century customer.
I was convinced that we would need to augment our standard playbook with a series of tech-enabled imperatives that could unlock new opportunities for growth with integrated technology and data – synthesizing the digital and physical to extend our differentiated service model beyond the four walls of our drive-in.
By retrofitting Sonic’s technology infrastructure, expanding digital touchpoints, and enhancing media strategies to meet shifting consumer trends, we built a digital ecosystem that would elevate the brand experience and transform customer engagement in ways that would outstrip all our competitors.
It also occurred to me that this would be a two-way street. By engaging our customers where they were and in a manner that only Sonic could, we would learn such detailed information about them – individually and collectively – as to supercharge our business strategies beyond anything our direct competitors could approach.
Initially dubbed our “Techno-Oval,” we came to refer to it as Sonic’s Integrated Customer Engagement (ICE) ecosystem. It was the combination of technology, digital media, and AI-enabled tools that would completely change how we engaged our customers, both on and off premise.
With our ICE strategy, we:
- shifted marketing resources in 2012 from half local to a mostly nationwide-focused fund to prepare ourselves for 21st-century marketing methods (first directed toward national cable, but ultimately aimed toward ICE),
- digitally retrofitted 3,500 Sonic stores, enabling the integration of all touchpoints in the customer chain of engagement,
- established our own proprietary media and data network for the brand, with over 100k distribution points for targeted and personalized promotional content (interactive, video-enabled drive-in stalls), providing an opportunity to interact one-on-one with every customer who pulled into a stall, and
- started to analyze the massive data collection provided by each transaction and utilize it for our AI-enabled customer relationship management (CRM).
The full implementation of ICE in March 2018 had become so intuitive to the customer experience – and so seamlessly embedded in the operating model – that its momentum carried well beyond Inspire Brands’ acquisition in December 2018. With little else materially new in the marketing mix, Sonic’s positive systemwide same-store sales momentum continued to flourish in 2019, while Craig and I watched the brand’s ongoing success from the outside.
In the midst of the COVID-19 pandemic, sales skyrocketed. Shocking? Not at all. With our bold new mobile experience fully deployed in the spring of 2018, the customer could order and pay from the comfort of their own home or car, then pull into a parking stall to pick up their meal. ICE and COVID accelerated a customer-led trajectory already well underway.
The result? FILET! Every customer was “First In Line Every Time.”
Turbocharging ICE in the AI Era
We’ve now entered a new phase of business evolution and opportunity for ICE-enabled growth.
Connectivity removed the barriers of time and distance. Mobile unlocked personalization at scale. And now, AI can rapidly accelerate insight into action throughout all levels of the operating model, amplifying execution.
AI doesn’t just accelerate decisions; it predicts demand, automates workflows, creates content, orchestrates operations, and continuously learns. Embedded intelligence will boost organizations to higher levels of performance.
The winners will be those who treat AI as an embedded business capability, integrated into the brand experience – not just a set of tools.
Those who connect “algorithmic” intelligence directly to the customer experience, unit economics, innovation velocity, and brand differentiation will succeed.
ICE was designed and built to support AI-enabled strategies by serving as the digital plumbing for embedding data and intelligence anywhere throughout the operating model. But we didn’t chase technology. Instead, we integrated the technology in such a way as to:
- reduce friction in the customer experience,
- improve unit economics,
- extend the brand beyond the four walls,
- and preserve what made Sonic, Sonic.
ICE wasn’t a side initiative. It was embedded directly into how we operated and engaged with our customers.
The ultimate takeaway is this:
Customers have integrated technology into their lives and daily practices. Brands that effectively integrate technology into their customer experience (in a way that improves that experience) can begin to leverage 21st-century brand-building to keep their strategic flywheel turning.
These same brands will then have the opportunity to learn from their customer engagement so that AI and other current tools can augment their CRM far beyond the reach of traditional marketing methods.
These two layers are the real skyrocketing opportunity of 21st-century brand-building and the highly refined customer engagement that is now possible!
But momentum is never permanent; it must be renewed and re-energized again and again over time.
Stay tuned. In our next blog, we will discuss what happens when the differentiated value proposition that fueled Sonic’s sustained momentum and growth for decades is abandoned.