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Buffalo Wild Wings Is About to Get Even More Entertaining

By Steve Symington - Mar 12, 2014 at 5:40PM

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Buffalo Wild Wings is about to bring something new to all its restaurants. Here's what investors and diners need to know.

With BEOND tablets in every location, Buffalo Wild Wings aims to boost diners' engagement.
Source: Buffalo Wild Wings.

In case it wasn't enough to offer a fun atmosphere with beer, wings, and walls of televisions showcasing dozens of sporting events, Buffalo Wild Wings ( BWLD ) is about to become even more entertaining.

On Thursday, B-Wild announced it's expanding its partnership with NTN Buzztime ( NTN ) to bring the smaller company's BEOND tablet-based entertainment platform to all Buffalo Wild Wings restaurants by the end of 2015. As of the end of last year, that meant more than 1,000 Buffalo Wild Wings locations.

Specifically, that means bringing a seven-inch Samsung Galaxy tablet to every guest -- customized for Buffalo Wild Wings' business, of course -- letting them order food, request a specific TV channel or song, pay their bill, play games like trivia and poker, and even set up a Blazin' Wing Challenge.

The multiyear agreement also involves replacing Buffalo Wild Wings' existing Buzztime Playmaker trivia consoles and follows a successful test of the new product in 30 locations. In fact, NTN's BEOND is already being used in roughly 150 company-owned restaurants. By the end of 2014, Buffalo Wild Wings expects the tablets to be available in 350 more.

If you can't quite picture what the new tablets are all about, here's a handy overview and some testimonials from the folks at NTN Buzztime:

Buffalo Wild Wings already has its head in the game...
It's not as though Buffalo Wild Wings needed the help. Last quarter's revenue grew 22% year over year on a comparable 13-week basis, driven by impressive same-store sales growth at company-owned and franchised locations of 5.2% and 3.1%, respectively. Earnings per share fared even better, increasing 57.1% over the same year-ago period.

What's more, Buffalo Wild Wings told investors same-store sales for the first five weeks of 2014 increased 4.8% and 2.1% at company-owned and franchised locations -- and we haven't even begun to see the positive effects of March Madness.

Meanwhile, casual-dining competitor Darden Restaurants ( DRI -0.94% ) last week questionably blamed bad weather and a Thanksgiving holiday shift for the most recent quarter's respective same-store sales decreases of 5.4% and 8.8% at Olive Garden and Red Lobster, respectively. Even excluding those negative events, however, Darden says same-store sales still would have fallen 2.8% at Olive Garden and 6.2% at Red Lobster.

And Darden isn't alone. Closer to Buffalo Wild Wings' wheelhouse is craft beer specialist BJ's Restaurants ( BJRI -1.57% ), which -- despite steady locations growth -- has put together a series of earnings disappointments so impressive it practically has shareholders begging for activist investors to step in. Comps fell by 2.7% during BJ's Restaurants' fourth quarter, thanks to both a 2.3% decline in foot traffic and a 0.4% decrease in average check price.

The funny thing is, BJ's Restaurants CEO Greg Trojan pointed out those figures are actually better than the casual dining industry as a whole, which goes to show just how impressive Buffalo Wild Wings' recent performance really is.

However, keep in mind Buffalo Wild Wings investors did punish the stock following those aforementioned quarterly results, primarily because of what the market perceived as worrisome forward-looking comments from management, who warned rising wing prices could depress earnings growth in the second half of this year.

...but they can have their wings and eat 'em, too
Even so, Buffalo Wild Wings new volume-based pricing structure should give it at least some control in moderating the effects of rising ingredient costs, so investors shouldn't need to fear an exact repeat of last year's expensive wings debacle.

But if Buffalo Wild Wings can do even better, why shouldn't it try?

That's where NTN Buzztime's latest creation comes into play. By creating a more immersive, interactive, and convenient restaurant experience through BEOND, Buffalo Wild Wings can not only entice diners to stick around longer and spend more money, but can also make them want to come back for more -- that is, even more than they already did.

What do you think? Is BEOND just a gimmick, or will it be a big win for Buffalo Wild Wings? Sound off in the comments section below.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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Stocks Mentioned

Buffalo Wild Wings, Inc. Stock Quote
Buffalo Wild Wings, Inc.
BWLD
NTN Buzztime, Inc. Stock Quote
NTN Buzztime, Inc.
NTN
Darden Restaurants, Inc. Stock Quote
Darden Restaurants, Inc.
DRI
$136.66 (-0.94%) $-1.29
BJ's Restaurants, Inc. Stock Quote
BJ's Restaurants, Inc.
BJRI
$29.39 (-1.57%) $0.47

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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