Wendy’s (WEN) great experiment with the pretzel bun culminated in the permanent menu adoption of the limited-time premium item back in August, fortified by an insistent advertising campaign for the Pretzel Bacon Cheeseburger. And it worked—for a time, at least.

Consumer passion for the chewy-bunned burger appears to have weakened since the product was introduced nationally during the summer last year. Wendy’s same-store sales in North America increased 0.7 percent in the third quarter, a notable slowdown from 3.1 percent growth at the same time last year. Emil Brolick, Wendy’s chief executive, credited last year’s success in no small part to the high-end pretzel bun. Now, with sales slowing, no one at Wendy’s is heaping blame on the bun alone. Executives believe the item is still helping boost sales.

The problem is that the fast-food chain focused too much on promoting premium products, such as the Pretzel Bacon Cheeseburger. Despite increasing demand for higher-quality fast food, a chain menu can’t depend on its spendiest items. Wendy’s has neglected to offer other deals that would draw value-oriented diners, a category that includes about 25 percent of fast-food customers. Such other chains as Burger King (BKW) have been discounting heavily, for example, with a two-for-$5 sandwich sale.

Wendy’s positioning relative to other big burger chains has long been fast-casual quality at lower prices. When asked on an earnings call last year if premium offerings limited the customer base, Brolick replied: “I do not feel that there’s any kind of constraint out there.”

Yet it seems the company may have overestimated its consumers’ readiness to switch from value items. Wendy’s has been losing share of what it calls “price-value consumers,” and now it’s focusing again on winning them back. “You can’t just not deal with that group,” Brolick said on Thursday’s earnings call. “And also, if you would look at the last, I would say, 10 quarters in the industry, the price-value customer growth has been stronger than the non-price-value customer growth.” Brolick said sales are better when the chain promotes both high-end and value deals, not just premium products.

(Bloomberg Businessweek)