Sex crimes charges against Fogle have prompted Subway to ditch him -- but they have big problems ahead.
Jared Fogle’s arrest on sex crimes charges has created an absolute disaster for Subway after employing him for 15 years as its pitchman — and their problems may be just beginning.
Ever since Subway discovered Fogle, who had lost 200 pounds just by eating sandwiches from Subway, it was a match made in heaven for both of them: Fogle went from obscurity to wealthy pitchman, and Subway had tapped into a market that was just starting to explode: newly health-conscious Americans who were looking to ditch fast food and eat something fresher that could help them shed pounds. But now, all of that has evaporated and now Subway has a big mess on its hands, according to a Business Insider report. He is expected to plead guilty.
Fogle was hit with federal charges after being accused of possessing child pornography and even paying for sex with minors, charges which Fogle is likely to plead guilty to and will likely receive a long prison sentence.
It’s difficult to overstate how important Fogle was for the Subway brand. Experts credit half of Subway’s explosive growth in the last 15 years to Fogle. His story of losing 200 pounds really resonated with Americans, a large portion of whom are overweight or even obese.
Subway immediately cut ties with Fogle when the FBI raided his Indiana home, and claimed they were ignorant of the real Fogle, although one person has come forward and claimed they told Subway about it a while ago, only to be ignored.
Now, instead of conjuring up images of fresh sandwiches at Subway, the name Jared Fogle is associated with sex crimes — not a good thing for a brand. Although customers aren’t likely to blame Subway for Fogle’s actions, it certainly can’t help things.
But without Fogle, Subway may be in trouble. The chain had a steep sales decline last year, dropping 3 percent in sales to $11.9 billion despite opening 778 new stores — the worst performance for any chain in the top 25, even worse than struggling McDonald’s which saw a 2.2 percent loss.
Subway faces new competition from Chipotle and Panera Bread, which is taking a bit out of its “made-to-order sandwiches” niche, and further advertising antibiotic and additive-free food.
With Fogle gone, Subway faces a very difficult future indeed.