Thoughtful differentiation as both a defensive and offensive strategy was a common subject heard by foodservice professionals attending the 2012 Chain Operators Exchange, or COEX, on Monday.
Presented by the International Foodservice Manufacturers Association with a theme of “Emerging Stronger,” COEX 2012 runs Feb. 26-29 at the Red Rock Casino, Resort & Spa in Las Vegas.
Emerging stronger is something that supermarket and convenience store prepared-foods programs have done in recent years, Jon Luther, chairman of Dunkin’ Brands, said in his keynote speech about leadership and why he believes success revolves around a company’s brand’s promise.
Supermarket and convenience store foodservice is “the new elephant in the room” in terms of competitive threats, Luther said, noting that many retailers have good locations, abundant parking and tend to receive more frequent visits by consumers than restaurants.
“You win people with service” and convenience, such as drive-thrus, he said, addressing how foodservice operators can differentiate themselves from threats outside the industry.
“While supermarkets and C-stores have captive audiences, you have the ability to captivate,” Luther told operators.
Differentiating through marketing
On the marketing front, some companies are successfully differentiating themselves by driving engagement with messages that play off a strength and resonate so strongly with consumers that they take to social media to tell others about their experience or join in a larger conversation, according to another COEX speaker.
“Marketing: Pull Them In” session presenter Ken Dowling, executive vice president and group management director at Grey Group advertising, said that among such companies are Chipotle, with its animated commercial decrying factory farming , and Red Lobster, a client for which Grey helped develop the current “I seafood differently ” campaign.
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Dowling said Darden Restaurants-owned Red Lobster was a tired brand prior to operational changes, and the shift in messaging from a focus on products and offers to the pride the chain’s employees and suppliers feel doing their jobs.
Guest counts at Red Lobster have been up every week at the chain since the campaign launched, according to Dowling, who later added, “You don’t have to spend a lot of money…[if]…you find the right message and deliver it in the right way.”
For quick-service chain White Castle, the right message often isn’t about the chain’s use of quality ingredients or heritage, but rather its users.
“Our greatest success is when we talk about our customers,” Kim Bartley, vice president of marketing and menu development for White Castle, said of such guest-centric initiatives as the chain’s Cravers Hall of Fame.
Opportunities to grow with operations
Michelle Mazur, senior analyst with the Hartman Group Inc., began the “Service: Thrilling Them” educational session by outlining how since the Great Recession, consumers have added an emotional component to their definition of “value;” how consumers love a good story about the food they eat and the people who serve it; and how informal is the new formal when it comes to service and ambience.
Mazur said research showed that 44 percent of all eating events are solo occasions, but that only 8 percent of those events take place in foodservice establishments, which begs the question of why single diners aren’t using foodservice?
“Foodservice needs to remove the stigma of alone dining,” she said, suggesting that operators devise ways to cater to solo diners and offer them special deals.
She also noted that while 48 percent of all eating events involve snacking, foodservice only snags about 29 percent of those snacking occasions and should look for ways to support them, such as by offering small plates.
Mazur’s talk was followed by a discussion about service among a panel of operators, who shared that:
• The Cheeburger Cheeburger chain has eliminated the hostess position “and having the owner at the front door, like in any street [independent] restaurant, has made a huge difference” in perceived service levels, said Jeff Jablow, director of training and menu development.
• Fast-casual brand Salsarita's is striving to demonstrate that “service is the differentiator” by getting people who normally work behind the counter to spend time in the dining room offering guests drink refills or extra chips, said Phil Friedman, the chain’s chief executive.
• While getting managers to stop by tables to talk to guests for two or three minutes certainly can help business, said Michael Feighery, president of Smith & Wollensky Restaurant Group, servers carry the most weight in ensuring guest satisfaction and repeat business because they spend two hours with patrons, and therefore should receive as much organizational support as possible.