Case Background
In 1953, Tyro Smith founded the prototype of the first Sonic drive-In in Shawnee, Oklahoma. Before 1953, he had already tried opening two other restaurants. Smith eventually bought a steak house that had a root beer stand on the lot. He intended to tear the stand down to add more parking for the steak house, but the root beer stand, called Top Hat Drive-In, proved to be more profitable and even outlasted the steak house. While traveling in Louisiana, Smith saw homemade intercom speakers at a hamburger stand that let customer order right from their cars. He liked the idea so much that he contacted the innovator and asked him to install the same intercom for Top Hat. The speaker system was placed, a canopy was added for cars to park under, and “carhops” delivered food directly to the customers’ car. Charlie Pappe, a manager of a local supermarket but looking for a new venture, dined at Top Hat while visiting his friends in Shawnee and was si impressed with the whole concept that he introduced himself to Smith. In 1956, Pappe successfully opened the second Top Hat Drive-In. Four Top Hats had been opened by …show more content…
A key element of Sonic 2000 was a “new, retrofitted exterior that features futuristic red pylons with fiber-optic lights, oval roofs and new logo”. Between 1996 and 1997, the percentage of customers who recognized the Sonic brand increased from 43 to 66. In 2001, Hudson took Sonic International by opening a store in Monterrey, Mexico, with more restaurants planned in Mexico City. By 2002, 2432 Sonic Drive-Ins operated in more than 30 states and two countries. Sonic grown to be a strong regional competitor, but as Sonic executives pondered additional growth, understanding the nature of the competitive environment became increasingly