The road to the C-suite may often travel through the marketing department, but if there’s one thing marketers-turned-CEOs bring to the table, it’s a focus on the customer.
The guest-first mindset was a recurring theme during the CEOs in the Hot Seat session at the Restaurant Leadership Conference in Phoenix on Tuesday, when six chain restaurant leaders shared their take on the need to lead holistically.
All of the CEOs had moved from marketing into leadership—which doesn’t necessarily guarantee their CMOs are happy to see them at the watercooler.
Here are some tidbits from their rapid-fire conversations with Chris Keating, executive vice president of conferences for Winsight Media, and Peter Romeo, Restaurant Business editor-at-large and vice president of content innovation.
Rob Lynch, president and CEO of Papa John’s International:
“All good leaders, whether through finance, operations or marketing, would be well informed to always start with the customer,” said Lynch.
When he started at Papa Johns, the chain was being “beaten up by Domino’s” and there was pressure to offer a value platform that could compete with Domino’s.
But Lynch said, “We can’t beat Domino’s by trying to be Domino’s. We have to be what makes Papa Johns Papa Johns.”
There was a reason why Papa Johns, as a “little upstart,” could take on the giant chains, he said. “It was all about quality ingredients.”
Papa Johns leaned into innovation, launching products like the Papadia.
“We challenged everything we’d always done and tried to do better, technology, innovation. Also just being the kind of company we could be proud of,” he said.
Betsy Hamm, CEO of Duck Donuts:
When Hamm started in marketing, the big focus was on TV commercials: how cool was it, how pretty was it, what stations were they were on. But marketing has evolved to become more data driven, working with people from operations to IT.
With about 125 locations now, Duck Donuts is in growth mode, with plans to open about 40 this year and 50-60 a year going forward. Having a marketing person at the helm is important now because that person would understand the need for innovation and what the customer wants, she said.
“I like to paint pictures and paint the vision with our story,” when speaking to the team, said Hamm. When talking to private equity, however, she has learned to communicate with key numbers and not “the fluffy stuff.”
“The biggest thing is we have to figure out to continue to grow the brand, and increase AUVs and profitability for our franchisees,” she said.
Chris Tomasso, CEO and president of First Watch Restaurants Inc.:
Tomasso sees the culinary, operations and marketing teams as “a three-legged stool” at the breakfast and lunch concept.
“Culinary innovation has been a big part of our success for years and I just feel like the art side of that needs to be unbridled and it can’t be driven by a voice in your ear telling you how hard it would be to operate, or a voice in your ear telling you that the margin percents aren’t there,” he said.
“We start with the wide-open ideation of ‘what should we be doing.’”
Rather than asking his team to develop a chicken sandwich, for example, First Watch’s culinary division has their finger on the pulse of what’s going on with the consumer across the country. They find inspiration and brings those ideas to the organization, Tomasso said.
Marketing and IT are also generally part of every conversation, he added.
Tomasso said a leader does not need to come from any specific discipline, but whoever is at the helm should have experience partnering with all aspects of the business.
“What discipline they come from is irrelevant but are they someone who can set a vision and bring people together,” he said. “I think the biggest test would be, if you could ask people in the organization would you vote for this person to be CEO, would they say yes. You can tell the people that have garnered that kind of support, and it has to be cross functional, they have to have had successes partnering with people within the organization.”
Jennifer Schuler, CEO Wetzel’s Pretzels:
Wetzel’s Pretzels is in a phase of innovation with the upcoming launch of the new street concept Twisted by Wetzel’s.
Marketers bring to leadership a certain fearlessness, she said.
“In marketing, when you make a mistake, the risk is a little more tolerable,” she said. “What you get in a marketing leader is someone who has experience with testing, failing, trying—the courage to step forward into something great, or something that could be a mistake.”
The road from marketer to CEO has become somewhat of a natural path in part because the marketing role has changed over the past few years to focus more on the wealth of data now available.
“It’s giving them a financial fluency, a data fluency, a comfort with the numbers,” she said. “To be a great marketer today, you have to have more comfort in the quantitative side of marketing, and that’s created more of a pathway to build financial fluency required to be a CEO.”
Kathie Niven, president and CEO of Biscuitville:
Niven said she had intended to go to law school when a friend asked her to help her revive a defunct Arby’s unit on the weekends. They didn’t know what they were doing, she said, but turned it into a $1.6 million restaurant and went on to open more.
That turned into a career in restaurants that brought her to Krispy Kreme, Burger King and Quiznos. She joined Biscuitville when it was a 45-unit family-owned chain, with a very lean corporate office.
As the company built its infrastructure and began to grow, they focused on hiring people who were very guest centric, she said. “I think in general one of the reasons Biscuitville has had the success they have had is because there is really just the disciple of starting everything with the guest in mind.”
Niven said the company set aside heritage thinking, and sacred cows, “and said let’s just ask the guest what they want,” she said.
“And that was probably the beginning of the growth spurt for us, it really made a difference from a branding perspective,” said Niven. “ And since then, everybody really does keep that lens in check.”
John Peyton, CEO of Dine Brands:
Peyton spent two decades as CMO of Starwood Hotels before joining Dine Brands, the parent to Applebee’s, IHOP and Fuzzy’s Tacos.
In the hotel industry, a tremendous amount of data is available to know exactly what guests want, from their preferred soft drink to feather or foam pillows.
The challenge for restaurants is to reach that level of knowledge about their customers, he said.
Dine Brands Restaurants recently launched loyalty programs will help the brands get more personally engaged with guests. IHOP, for example, launched its International Bank of Pancakes loyalty program last year and now has 5 million members who generate about 5% of sales.
“We’re now getting to know those customers in a personal way, so we can market to them in a relevant way,” he said.
Peyton admits that his job is to share advice and sometimes the job of brand CMOs is to ignore that advice. Last year, for example, Applebee’s had a product placement with the show “Survivor.”
Peyton said he didn’t get it. What was Applebee’s doing on the island?
But as soon as the episode ran, his phone blew up and his marketing network hailed its brilliance, thinking it was his idea. “It’s all about the team,” he said.
Peyton’s marketing experience helped with the decision to acquire Fuzzy’s, however.
“They literally had me at hello,” Peyton said about visiting Fuzzy’s. “It was all about the brand experience.
“I was taught years ago that the essence of branding is everything communicates. So it’s what your servers wear, how they greet you … the menu, how you appear digitally, everything has to tell the same story.”
Fuzzy’s describes itself as sassy and bold and colorful and exciting.
“I now get to say butt-burning sauce, which I never thought I’d get to say before,” Peyton said. “That’s how branded they are, as they name each and every one of their products.”
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