Pull!
A trend soars into the mainstream, and one chain or another draws a bead on it, hoping for a solid hit. One times it perfectly and connects; another aims wide and blasts the innards out of a transformer bolted to a nearby utility pole, throwing half a county into darkness.
And so it was this week in the restaurant industry.
Operations large and small took aim at a variety of consumer and business trends, some older than Larry King’s grandma. The common objective, of course, was to put a bullet under sales or profits. Some looked as if they nailed it and can notch their guns in the weeks ahead. Others will be spending considerable time with a broom and dustpan, sweeping up metal shards around a charred utility pole.
Here’s a scorecard:
Giving the wholesome trend a shake.
The most dismaying aspect of McDonald’s current plight is the lack of a visible, cohesive plan to put things right. Is the strategy to tout rock-bottom prices? Or is it convenience? Should the spotlight be on new products, or the old familiars that consumers instantly recognize and trust? And what’s with the lip service about simplifying menus, when this week brought the head-turning news that a strange riff on Chicken McNuggets is already in a sales test?
In case your neck was spared the rotation, here’s what left others with whiplash: The flavoring packets sold in some McDonald’s markets as a compliment to French fries are being offered in a handful of other stores as a way to kick up the flavor of Chicken McNuggets. Mass-market chains like Wendy’s, Panera Bread, Chipotle and Five Guys are connecting with consumers by stressing the wholesome ingredients that go into their food. McDonald’s is betting the public will similarly embrace a powder they pour over breaded fried chicken and shake up in a bag to make the chicken taste like something far, far different, like ranch salad dressing.
Sure, there’s a preference evident among consumer today to embrace bolder flavors. But why disregard the much bigger wholesomeness trend with something so patently artificial?
Bam! A miss for sure.
Beer selection worthy of a brewpub—in fast casual.
Even people left in a blackout by errant shooting can see that alcoholic beverages are becoming an important means of differentiation in the fast-casual market. You can now catch a buzz at Chipotle, Starbucks, Noodles & Co., Hopdoddy, Salsarita’s and a host of other concepts. But the attempt by the Zpizza chain to ride that trend is truly a head-turner.
First, there will be 18 brews—on tap. But where the new taproom version of Zpizza really distinguishes itself is in how those dispensers are used. Customers pay for a “smart” bracelet that monitors the users’ consumption and remaining beer funds. Patrons draw their own 16-oz. beers, reading a lowdown on each via a tablet at the tap.
All the buzz of a fast-casual pizza place, selling better-for-you-pie, combined with the allure of having 18 microbrews on tap, overlaid with cutting edge technology that virtually eliminates service wait times—a bull’s eye for sure. Keep an eye on this one when it opens in a few days in southern California.
More evidence fast casual is stressing its casual gene.
Meanwhile, one of the first enterprises to plant itself in what we now call the fast-casual market is betting there’s more opportunity upstream. At a time when many full-service operations are trying to co-opt fast casual’s success with service and menu tweaks, Fuddrucker’s, a granddaddy of the segment, is giving casual dining a try.
The chain disclosed this week that it had opened a tableservice variation in Virginia called Fuddrucker’s Deluxe Bar and Grill. Consistent with fast casual’s shift into alcohol, the unit features a full bar, along with an expanded menu of burgers and casual-dining staples, including appetizers.
The chain didn’t say why it’s taking a contrarian track. But it’s now owned by Luby’s, which in turn is controlled by the Pappas family of Houston, best known for operating high-volume full-service concepts like Pappadeaux, Pappas Bros. Steakhouse and Pappas Burger.
Clearly the move of Fuddrucker’s into full service adds topspin to the trend of fast-casual players expanding the boundaries of their lucrative market.
Outsourcing as a good thing.
Remember outsourcing, the evil job killer and bane of America First-ers? It flared back this week, in the restaurant business no less, but this time it was lauded as a smart way to lower G&A costs while sales are still weak. Jamba Juice announced that it would switch to an “asset-light” model whereby a number of traditional headquarters functions would be outsourced to a Paris-based global firm called Capgemini.
Jamba stressed that only “specific” administrative responsibilities would be delegated out-of-house, including app development and maintenance; unspecified broader tech responsibilities; and accounting and finance.
“We are providing strong outplacement support for affected employees and we were able to find roles within the organization for a number of those whose positions will be transitioned,” Jamba EVP and chief financial/chief administrative officer Karen Luey said in the announcement.
The news seemed to be well received by the investment community, suggesting the trend may see additional revival in months to come.
Food trucks + NASCAR mania.
Few aspects of the restaurant business are undergoing as radical a change as the efforts to turn consumers’ heads through marketing.
This week alone, Pizza Hut disclosed a plan to drum up business during football season by appealing to participants in fantasy leagues. (Explain how the offer of free pizza might prompt a rival participant to trade a star player and you might get the pie for free to complete the deal.)
Taco Bell pushed its new dollar menu by offering free food for life to anyone who comes up with one of 11 marked dollar bills the chain will release in 11 markets. Fans can track the location of the money via Taco Bell’s website.
A true nod to a new generation of publicity stunts and gimmicks was quietly undertaken this month by the Wind Creek Casino & Hotel in Wetumpka, Ala. The property called attention to its new Good to Go food truck, along with other amenities, by dispatching the vehicle to the Atlanta Motor Speedway, an iconic NASCAR track, for a flat-out run.
“Driven by Chef Paul Norton, Good to Go posted a blazing 4 minute lap time, only slightly slower than the average time of a NASCAR qualifier at 26 seconds,” read the press release.
Look for more food trucks to woo the blue-collar market by revving their motors. Though some still maintain a demolition derby would be best for that market.
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