Subway revamps menu, boosts ad spend to win back customers

[July 06, 2021]  By Hilary Russ

(Reuters) - Subway is overhauling its menu and pouring money into marketing as the world's biggest restaurant chain by number of stores aims to win back customers with its new sandwiches.

The chain has floundered since co-founder Fred DeLuca died in 2015, the same year its popular spokesman Jared Fogle pleaded guilty to child pornography charges, and as it faces stiff competition from Chick-fil-A and Popeyes.

The revamped U.S. menu starting Tuesday includes Cali Fresh Turkey and All American Club sandwiches, a slew of new ingredients and two types of bread, and would address a yearslong lack of innovation, said Chief Executive Officer John Chidsey, who joined Subway in 2019.

Some items including rotisserie chicken and roast beef are being added back after the chain removed them last year to streamline operations and speed up service amid the COVID-19 pandemic.

The company's restaurants are also replacing "outdated" items, such as swapping guacamole with smashed avocado, Subway executive Trevor Haynes said in an interview.

The chain is also supporting the rejig with the second-largest ad budget among restaurants behind McDonald's Corp and renovation of restaurants, Chidsey said, without disclosing any numbers.

Subway had experienced a few years of "malaise", Chidsey said in an interview. "We just want to get back to what we consider our fair share of wallet and stomach."

Media reports have said Subway is tidying itself up for a sale, but the restaurant chain denied it.

(Reporting by Hilary Russ in New York and Praveen Paramasivam in Bengaluru; Editing by Ramakrishnan M.)

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