Shaking up the competition

How fast casuals are revolutionizing milkshakes.

Milkshakes and malts—two old-time soda-fountain treats—are seeing big-time action at fast casuals. According to Chicago research firm Technomic, menu mentions of the ice cream-based drinks increased 12 percent in the first quarter of 2014 over 2013. By differentiating the beverage menu with these indulgences, fast-casual concepts are vying for that between-meal customer who is a regular at the coffee cafe, Technomic suggests.

They may be following the lead of Sonic, which launched milkshake happy hours in 2013 to lure snackers. This summer, the Oklahoma City-based QSR is repeating the offer with half-price shakes after 8 p.m. They’re available in four sizes, ranging in price from 99 cents to $2.20 after the discount. Other concepts are now running shake promotions during off hours, too. These include the three-unit Big Daddy’s in New York City, which offers both regular and spiked shakes ($3.50 to $6) from 3 to 5 p.m. and Houston-based Steak ’n Shake, which has milkshake specials between 2 and 4 p.m. and 2 and 4 a.m.

At 180-unit Fuddruckers, milkshakes traditionally have been marketed to complement the food; POS signs encourage guests to “make the shake splurge” when they order a meal, and only one size (11 ounces for $3.99) has been offered. This June, the Houston-based chain introduced a 7-ounce shake for $2.99 to both expand its snacking business and boost checks. “We hope the lower price point will translate to add-on sales,” says Dan Phalen, corporate executive chef for Luby’s Fuddruckers. “Many customers who order a burger and fries want a shake but have no room. The smaller size alleviates that.”

Handcrafting is a selling point at Fuddruckers, and the technique is reinforced with cues such as hand spinning the shakes in old-fashioned mixers and a freezer devoted to frosting glasses—all on display for the customer to see. “Handcrafted items are a calling card for many fast-casual operators, such as the margarita at Chipotle or the smashed, seasoned burgers at Smashburger,” says Donna Hood Crecca, senior director of Technomic. “Made-to-order milkshakes provide a premium, indulgent dessert offering to round out the menu at fast-casual eateries.”

Lately, fast-casual concepts are getting the handcrafted message across by incorporating fresh, seasonal ingredients into their shakes or creating innovative flavors of the month. “Berry is a hot flavor this summer,” says Hood Crecca. She cites the Triple Berry Blast at Vancouver, Wash.-based Burgerville. The shake features Northwest raspberries, blueberries and marionberries blended with ice cream from a local dairy. And at Wayback Burgers, the 85-unit Cheshire, Conn.-based chain, the August Milkshake of the Month is Wild Berry.

“The milkshakes are an integral part of our lineup that can add up to 17 percent of our net profits,” says Richard Tarascio, Wayback’s vice president of product and procurement. “We have them displayed on the menu board—an area pointed out by the person at the register when upselling our Milkshake of the Month.

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