Fall weather is here and that means football and comfort food for most Americans. As many as 205 million unique viewers tuned in to the 2013 NFL football season, according to Nielsen. For reference, that is more than 70% of potential viewers in the United States. Football is big business in this country, not only for the National Football League but also for popular sports restaurant chains like Buffalo Wild Wings (BWLD) and Famous Dave's (DAVE). From catering tailgates and Super Bowl parties to watching the game with friends at their local chain, football fans flock to these restaurants every year during the fall football season.
Now that the NFL season has officially kicked off, both Buffalo Wild Wings and Famous Dave's should see a meaningful bump in sales. However, one of these stocks stands out as a better buy for investors today.
Catering to sports fans
Both of these brands do an exemplary job of appealing to sports fanatics. Famous Dave's stepped up its takeout efforts last year by launching a new online ordering platform that makes it easier for customers to place mobile orders. With its updated "To Go" platform up and running, the famous BBQ joint saw takeout orders grow more than 13% to nearly 26% of net restaurant sales in fiscal 2013. In addition to its upgraded mobile and web-based ordering systems, Famous Dave's rolled out a call center recently at all company owned locations. This should alleviate wait times for takeout orders during peak weekend hours. Together these things should help drive business for Famous Dave's in the busy fall season.
But Buffalo Wild Wings comes to the table with some impressive tricks of its own. B-Dubs is taking a more targeted approach to attracting customers. The restaurant chain teamed up with PepsiCo (PEP -0.50%) last month to offer groups of eight or more a fantasy football draft party kit when they held their party at a Buffalo Wild Wings restaurant. The kit included a fantasy draft board, player stickers, coupons for free food on future visits, a brag flag, coasters, and bottle openers.
Joining forces with Pepsi is a smart plan because the soda giant has a long-standing relationship with the NFL. B-Dubs also offered the free kits to take-out customers that spent at least $100 on their order. On top of this, Pepsi threw in a sweepstakes offer that gave fans a chance to host their 2015 draft pick parties at NFL headquarters in New York City. This is just one of many promotional events that Buffalo Wild Wings has crafted around football season.
Buffalo Wild Wings also rolled out its Game Break multi-platform gaming experience this month, which allows customers to play a range of fantasy-style sports games on a tablet in the restaurant, at home on the web or on their mobile devices. This is important because it puts sports fans everywhere in constant contact with the B-Dubs brand -- enabling the company to connect with its customers both inside and outside of its restaurants.
A winning strategy
From its strategic partnership with Pepsi to an ever evolving line-up of sports focused promotions, Buffalo Wild Wings is better positioned than Famous Dave's today to capitalize on the seasonal football mania. It also appears to be a better stock for investors. Shares of Buffalo Wild Wings are down more than 8% year to date, which creates a favorable entry point for long-term investors. Famous Dave's stock, on the other hand, has soared more than 44% so far this year to where it currently trades at around 32 times earnings.
Ultimately, Buffalo Wild Wings is creating an environment that makes its brand synonymous with sports, particularly football. This should drive more customers through its doors and fuel sales this fall. Therefore, I believe B-Dubs is a better stock to own today.