Can a Business Be Built on a Single Craving?

The shine is coming off the star that is Fast Casual. With several exceptions, the category has had a rough year plus. This past quarter continued declining category sales overall. After several years of craving creating brands, headlines and growth the narrative has been changing.

Analysts are now looking back to QSR as the best bet for growth. Experts are calling for brands like Jack in the Box to spin off their Fast Casual sub-brands (in this case, Qdoba) because they are creating drag for the higher growth QSR.

Fast Casual brands have been praised for a simplified, focused menu. Under-complicated. Built around a single craving. Think Habit Burger (one of the Fast Casual brands bucking the growth trend). That is a fantastic attribute until it isn’t. One clear difference between FC and QSR brands is veto power. FC brands have menus based on one craving. A great burger. Custom pizza.

Across QSR, brands have built our a strong menu that attracts a core while adding a moat. That moat is the extra items that match the brand expectations but meet a different craving. This stops the veto, which is difficult for a brand like Qdoba with a very simple menu to do. Want a burrito, or something like it? Great, Qdoba works. But if not, the search for the next option begins. The single craving is a double edged sword.

Every new FC brand had a simple description: Chipotle for “insert cuisine here.” There was a novelty for most cuisines, as people flocked to see how pho or Uraguayan food could be presented to guests in an assembly line. But time passed and the unknown became the known. There was nothing new to try and back to Jack in the Box we go. Burgers, chicken, tacos, breakfast. Plenty of options for all.

People are not getting richer so price will matter going into the next 18 months.

Doing the mental math here? The next move for Fast Casuals would naturally be to combat the QSR menu moat by adding items. Not so simple. The expanded menu is just one moat. The second was built-in by Fast Casuals but has been enhanced. Pricing.

Fast Casuals took price as part of a premium positioning to differentiate against the perceived quality gap of QSR from the outset. In many cases, the claim that a tighter focus on a single craving made the price make sense. As in: we use the best ingredients to make the best burritos, sorry it costs a bit more. Now it’s a little hard to go head to head with QSRs and expand the menu to match. Sure, they may offer a more premium product but going head to head gives people a chance to compare price.

People are not getting richer so price will matter going into the next 18 months. Fast Casuals like Blaze can’t expand their menu. They’ll be unable to compete on price against QSRs and against Casual Dining if they try to add premium entrees. The question becomes what can they do to make people crave their food more? If they really wish to expand that craving, they’ll need to bring in new, unique flavors and innovation into their core. Fast Casuals have to go all in on ingredients in both variety and quality. Enhance that single craving and make people see the difference between their offering and QSRs.

Is your brand experience easy to understand?

I visit a lot of restaurant concepts to find new trends and innovations. I always note is how easy it is for a new customer to understand what they are supposed to do to enjoy their visit. Especially their first visit. Blow that one, and there may not be a second. In our research into Millennial dining habits, 58% told us they base dining decisions on past experience. It is important to get it right early and often.

Menu

This is an issue on two levels. First, choosing the menu items and names that let people understand what they are choosing from and what it will taste like. Some concepts go all in on naming conventions that don’t always set expectations. Krystal calls its regular burgers Krystals. Probably fine given the presentation of the menu and focus on that primary items. But also on the menu are variations of hotdogs called Pups and Corn Pups.

Does everything on the menu make sense together? If you’re an Asian wok-based concept like Pei Wei, adding sushi is not a far leap for the customer. Less so at a southern chicken concept. That’s pretty simple. What about new items Buffalo Wild Wings has added? The brand has done great with a straightforward menu and formula of wings, sports and beer. Do burgers make sense there, or is the brand grasping for innovation. They’ve also added a pulled pork sandwich to their menu, even further afield. Raising Cane’s has been disciplined in keeping the menu extremely tight. Time will tell if they feel the need to expand the menu when location growth slows.

Don’t underestimate the importance of menu design. QSR and fast casual brands have the burden of communicating the flavor and experience at distance and often without much conversation. At Culver’s, the menu is much more expansive than a new guest might expect, making the first visit potentially overwhelming. Is the menu organized as simply as it can be? Are there flavor cues where needed? Is the menu divided intelligently, so it can be scanned.

Footprint

This is sometimes out of your control, but a restaurant layout needs to welcome people. In casual dining, it’s important to have an area near a host’s stand for guests to gather and wait. But also to hear the music and see the sights inside the restaurant. No one likes to wait, but at least give them a chance to absorb the atmosphere and get excited to get to their seats. Texas Roadhouse does a great job with this.

In fast casual and especially QSR, give them an entry that allows them to comfortably view the menu. Even if a restaurant is as simple as Five Guys or Firehouse Subs, the first visit takes some orientation. Give people space to stand back and observe; don’t force them directly into the queue. Watch people’s first visit to a Qdoba and witness the awkward pauses, the questions, the confusion. Don’t position the menu at awkward angles that make it hard for people to read. A common mistake is posting the menu boards on the wall along the queue at chest height; the spacing makes it impossible to read.

When designing a standard footprint we maximize seating, kitchen equipment, safety. Make sure customer experience is included. Especially for new guests. How much does the layout give the guest a chance to understand the brand? Guests need to look at some of the food on other guests tables, see how they’re eating it, and what they’re combining.

Training

Does your staff know their stuff? Do they help people understand? Are they trained to explain the concept and guide people towards favorite menu items? In a perfect world, the answers to all of these are yes. But reality is far from perfection. Even with the best menus and a flawless layout, some guests just won’t read or get it. Some will want to talk to staff and test them.

Find out what the most common questions are from guests. Set up training programs to give staff the help they need to perform at this level. Secret shop to ensure a high standard is being upheld. Reward staff living up to that standard with spot bonuses or other perks.

Staff trained in explaining the experience are trained in hospitality. Executing that well turns a confusing experience into a great one.