Chick-fil-App: No More Waiting in Line

Business Insider: “Chick-fil-A is rolling out a new app that will let customers avoid waiting in line at the register. The app, called Chick-fil-A One, will allow customers to order and pay for their food in advance, then pick it up at a counter designated for online orders. The app will also allow users to customize and save their favorite orders. Michael Lage, a veteran of Facebook and Google who helped develop the app, says it will change how customers, particularly parents with young children, experience and interact with Chick-fil-A.”

“To celebrate the launch of the app, Chick-fil-A is giving away free chicken sandwiches to everyone who downloads it between June 1 and June 11 … The app will continue to give away free food beyond the launch through its built-in rewards program, which will randomly send customers free-food offers based on what they typically order.”

“When customers get free treats from Chick-fil-A, they will have the opportunity to rate them. Those ratings will be factored into the app’s future free-food offers. Customers will typically get a choice of several items for their free-food offers. For example, they will be allowed to choose among a free drink, dessert, or medium fry. ‘We want to make sure the experience is based on personalization and choice,’ Lage said.”

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Organic Coup: The Costco of Chicken Sandwiches

Business Insider: “The Organic Coup, which is the first USDA-certified organic fast-food chain in the US, just raised $7 million in an initial round of financing led by Costco founder and former CEO Jim Sinegal … The chain, which specializes in fried-chicken sandwiches and chocolate-drizzled caramel popcorn, has two restaurants — one in San Francisco and another in Pleasanton, California.”

One of the restaurant’s co-founders is Erica Welton, a “food buyer for Costco for 14 years before leaving to launch Organic Coup with Dennis Hoover, a 33-year Costco veteran … Welton and Hoover don’t have any prior restaurant experience” but “are modeling the new chain off of Costco in many ways.”

“Organic Coup is paying starting wages of $16 an hour in San Francisco and $14 an hour in Pleasanton. Fast-food workers in the US make $7.98 an hour on average, according to PayScale. The restaurant’s specialty is its spicy fried chicken made from organic, air-chilled chicken breasts fried in coconut oil … The menu is pretty simple. Customers can get the fried chicken with a range of sauces on a bun, in a multigrain wrap, or in a bowl with shredded vegetables … The chain will be adding tator tots to the menu as well.”

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The ‘New’ Applebee’s: Hand-Cut & Wood-Fired

Business Insider: Applebee’s “is installing wood fire grills in all 2,000-plus locations across the US — a $40 million investment by the chain’s franchisees. The grills will completely change much of Applebee’s menu’s meal preparation, impacting 40% of items on the menu. It’s a major change that Applebee’s hopes will allow the chain to gain culinary credibility and stand out from the vast array of casual dining restaurants across the US, which have struggled to keep up in an era dominated by fresh fast casual chains.”

“You’re going to see it and hear it,” said Julia Stewart, the chairman and CEO of Applebee’s parent company DineEquity, Inc. “You’re going to literally smell it when you’re in the parking lot, and then you’re going to walk in and see it on the menu, and then you’re going to have a food server talk about it in a very excited way.”

“Beyond the grills, the chain is adding new items like hand-cut wood-fired steaks to the menu, training employees as meat-cutters, and remodeling locations across the US. It is also launching a $120 million marketing campaign, the largest in the company’s history, with a new creative agency.”

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McDonald’s Ritual = Customer Loyalty

The Washington Post: “Surely there are plenty of customers who have traded up from the fast-food standbys for pricier offerings from fast-casual restaurants that they perceive as healthier and fresher. But now that we’re deeper into the fast-casual boom and consumers have adjusted to this new restaurant landscape, it’s worth noting that they tend to stay exclusively in one dining lane.”

“So if Taco Bell, for example, were to slip into a rough patch, it seems more likely that those dollars are being lost to another fast-food player — not Chipotle. And as Chipotle aims to pull out of the sales spiral it has been in since some of its restaurants were closed because of e. coli contamination, it might be better off not trying to emulate Taco Bell’s new breakfast menu, but instead trying to win over the people getting lunch at Panera.”

“McDonald’s still dwarfs the other brands in terms of overall foot traffic, and its customers have very little overlap with other chains … McDonald’s customers also tend to be more loyal than any others in the industry, preferring to stick with the Golden Arches as a ritual instead of bouncing around different chains.”

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McNugget Reboot Targets Different Crowd

The Atlantic: “The reboot of the Chicken McNugget is a mechanism by which McDonald’s is continuing its effort to present itself as a ‘modern progressive burger company.’ Last year, the company announced the phasing out of chicken raised with antibiotics used in human medicine, said it would stop using palm oil linked to deforestation, and pledged to shift to cage-free eggs.”

“The revamped version of the Happy Meal staple will soon be free of artificial preservatives, instead containing lemon-juice solids and rice starch.”

“Through its rebranding process, McDonald’s has still managed to sell plenty of Chicken McNuggets, particularly to lower- and middle-income consumers who are concerned more about price point than about the impeachability of the company’s food sourcing. Instead, this tentative new McNugget is an effort to reach a different crowd. ‘There’s a smaller amount of consumers who don’t eat them, but might be willing to if they raised the bar on quality,’ said Darren Tristano, the executive vice president of the market-research firm Technomic.”

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In What Universe Is Salad a Technology?

Slate: “Walk past a Sweetgreen during lunchtime, and you’re bound to find a line of famished office workers snaking out the front door for a shredded-kale caesar salad or quinoa bowl. But when the Los Angeles-based farm-to-table salad chain launched a new app in January, it curiously referred to itself as a business that had developers—not produce or salad dressing—at its core. ‘We’ve always acted more like a tech company than a food one,’ read its press release.”

“In recent years, Sweetgreen has grown an in-house tech team and created an algorithm to make ordering more efficient … These days, businesses across every sector—from fashion to finance—are claiming the tech label. The recasting is seductive: It’s simply a lot cooler to be about the internet of things than to be about just things.”

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Chipotle ‘Loyalists’ Are Most Unforgiving

The Wall Street Journal: “Foursquare Inc. analyzed traffic data from its location-sharing mobile apps and found that Chipotle’s most loyal customers have been less forgiving of the chain than infrequent visitors. Last summer, 20% of Chipotle customers made up about half of foot-traffic visits.”

Says Foursquare CEO Jeff Glueck: “Interestingly, it’s this group of faithful customers that have changed their Chipotle eating habits most dramatically … These once-reliable visitors were actually 50% more likely to stay away in the fall during the outbreak, and they have been even harder to lure back in … Losing 2–3 loyal customers is the equivalent of losing about 10 other customers.”

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The Domino’s Effect & The Brand Experience

From a Wall Street Journal review of Door to Door by Edward Humes: “Domino’s Pizza … is really in the logistics business, funneling inputs—pineapple from Thailand, boxes from Georgia, salt from Minnesota—through 16 distribution points in the U.S. … one such ‘commissary’ … mixes enough dough, day in and day out, for 100,000 pizzas. Refrigerated big-rigs full of ingredients depart at 8 p.m. and make deliveries while the stores are closed.”

Mr. Humes writes: “The average American coffee-drinking household … never has less than 572,000 miles of travel pass through its coffeemaker every year.”

“The more complicated the product, the more tangled the supply chain … the components of an iPhone ‘collectively travel enough miles to circumnavigate the planet at least eight times.’ Assembly takes place in China, but the barometric sensor comes from Germany, the Gorilla Glass from Kentucky, the microprocessor from Taiwan or Texas.”

“We live like no other civilization in history, embedding ever greater amounts of miles within our goods and lives as a means of making everyday products and services seemingly more efficient and affordable,” writes Mr. Humes. “In the past, distance meant the opposite: added cost, added risk, added uncertainty. It’s as if we are defying gravity.”

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Philz Coffee: The Value is in The Experience

A San Francisco coffee house called Philz plans to challenge Starbucks with a different kind of experience, Forbes reports. “At Philz you won’t find the fancy brewing equipment of an artisanal coffeehouse. Beans are ground to order and then splashed with 205-degree water in pour-over funnel brewers. The coffee is good, but it is not cheap–a small coffee costs almost twice as much as Starbucks’ equivalent. Philz proponents say the value lies as much in the experience, or in what (founder Phil Jaber and his son Jacob) call ‘Grandma’s House,’ as it does in the coffee.”

“Unlike the corporate uniformity of Starbucks or the manicured hipster haunts like Blue Bottle, Philz has an informal charm that can be found in the mismatched couches at its original location and in the cup-by-cup approach of its baristas, who load drinks with heavy cream and brown sugar to each customer’s preference. ‘Taste it and make sure it’s perfect,’ a barista says before handing over a beverage. Details like that foster ‘an emotional connection’ for customers, says Jacob, 29, the CEO. ‘We think of ourselves as more in the people business than the coffee business.'”

“This year Philz plans to open at least two locations in Washington, D.C., the first true test of whether the company’s service-oriented approach can succeed outside California. Ultimately Jacob has visions of expanding into New York and Boston, with 1,000 stores nationwide, and “disrupting” the coffee industry … So far the company has interviewed more than 300 people, and Jacob has hired 30 … All will go through the company’s Apple-influenced Philz University training program, where they’ll be taught not to ask for customer names the way Starbucks does when taking orders. Doing so, Jacob says, is impersonal, because it suggests you’ve never met, and there’s a chance you’ll get it wrong.”

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