Sonic enjoys strong brand equity (particularly in core South Central U.S. markets) around its drive-in format with car stalls, friendly carhops and a plethora of specialty drinks & frozen treats. Its drive-in format increases the chance that every customer will be first in line and allows customers to take their time ordering without concern about slowing a drive-thru line. Sonic’s unique digital POPS (point of personalized service) order platform further improves the drive-in experience while facilitating on-lot marketing capabilities. The chain’s craveable and fun (made-to-order) menu items span 5 dayparts (drinks, desserts & sides drive snack hour sales) with the full menu available all day. A plethora of unique drink/treat options generates strong trial and frequency (offering guests a reason to return). Drinks can be personalized with add-ins, including: candy options (like Nerds); real fruit (lemon, strawberry & lime); and flavor shots (including cherry & blue raspberry). Frozen Zone real ice cream treats include Sonic Blasts made with Reese’s, Butterfinger, Snickers and Oreo. All-American food offerings include: made-to-order cheeseburgers (Sonic & SuperSonic); chicken, hot dog & coney variations; and onion rings & tater tots. Value is addressed by a steady layer of LTO deals and high margin specialty drink & dessert platform which facilitates happy hour and seasonal evening discounts. Notably, Sonic’s sales are a function of: the discretionary nature of its treats & specialty drink positioning; increased specialty beverage & snack competition; geographic concentration in Texas, Oklahoma, Tennessee, Missouri & Louisiana; smaller, rural market orientation; the challenge of establishing its drive-in/carhop model in newer markets; and weather as sales of frozen treats & beverages are more sensitive to snow, ice & cold temperatures. The chain’s sales under-performance over the last couple of years also may reflect a notable weakness in spending on food-away-from-home amongst the lower income demo that is typical to Sonic’s smaller, rural markets. Sonic’s store-level EBITDAR margin is pressured by a relatively low AUV (to go with a low check) and high ad contribution requirement which has been ineffective at driving comps – calling into question the efficacy of the two guys ad format which maybe long in the tooth. In conclusion, while Sonic seems to be doing a good job of maximizing its core operational equities while also offering a competitive value equation, a lack of corresponding sales lift suggests that the brand may need to consider a new marketing approach – perhaps one that emphasizes its food more so than the comedians.