Buffalo Wild Wings: Chicken, beer -- and iPads?
The red-hot chain is expanding testing of at-table tablets.
By Kyle Woodley
For decades, scores of customers have flooded Buffalo Wild Wings (BWLD) for its sauced-up chicken.
Soon, they might be sticking around for the Apples.
Buffalo Wild Wings recently announced an expansion of its tester program to put Apple (AAPL) iPads in the hands of customers -- a tech initiative that could keep the good times rolling for this successful restaurant stock.
The wing-slingin' chain is testing the iPads as a tool for letting customers order food and drink from their tables. The iPads also are being tested as at-table entertainment systems -- a huge upgrade over the ubiquitous NTN Buzztime (NTN) pads used for bar trivia -- that would feature not only games but connectivity to social media like Facebook and Twitter.
Tablets-as-menus have popped up in smaller chains and individual restaurants over the past few years, but Buffalo Wild Wings -- with more than 800 stores -- is one of the largest chains to give them a go. The company has been working out technical problems in its Toronto location, and now it's ready to launch its next tests in a Minneapolis location to see what uses the iPads ultimately will combine.
The possible benefits from tablet use across BWLD's locations are numerous. Allowing customers to easily order what they want, when they want, could loosen their purse strings. And don't think waiters will be put out of work. Director of international business Tim Murphy says waiters will have more time to interact with guests and promote Buffalo Wild Wings' food and drinks, according to ComputerWorld.
Adding iPads also could have a strong pull on the female demographic. According to Buffalo Wild Wings, testing showed that male customers typically wanted to watch sports, while women were more likely to pick up an iPad and launch Facebook -- a point likely not lost on BWLD management, which is heavily dominated by women, including longtime CEO Sally Smith.
Also, iPads could become the next-generation commercial place mat, with ads gracing the menu or game screens.
Of course, Buffalo Wild Wings doesn't really need the help.
After the bell Tuesday, BWLD put out another stellar earnings report, showing revenue jumping by 34% to $220.5 million and earnings per share by 33% to 73 cents. That extends its double-digit quarterly streak of earnings and revenue growth. During the period, Buffalo Wild Wings same-store sales increased by 9% (company-owned) and 5.9% (franchise-owned).
Buffalo Wild Wings stock has boomed since the depths of the financial crisis, up 400% from its lows in November 2008. And BWLD shares are up 70% in the past year, outpacing similar-size chains like BJ's Restaurants, which is up 45% (BJRI), and Chili's parent Brinker International, up 17% (EAT).
Still, Buffalo Wild Wings has no thoughts of resting. Smith said BWLD plans to open its 900th restaurant this year and expects to eventually reach 1,500 locations on the continent. The company also will roll out online ordering this year. On the financial side, Smith expects Buffalo Wild Wings' earnings to grow 20% in fiscal 2012.
The iPad's eventual future with Buffalo Wild Wings is far from cemented, but it remains a fitting symbol of this quickly forward-moving restaurant stock.
The iPad's influence hardly ends here. For example, find out just how much the device is penetrating the business market.
Kyle Woodley is the assistant editor of InvestorPlace.com. As of this writing, he did not hold a position in any of the aforementioned securities.
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The solid report comes a month after the retailer closed all of its Canadian operations.
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