The Food Genius Blog.

A Restaurant’s Success Favors Those Who Innovate

Last week, Restaurant News featured an article about the changing landscape in restaurants.  The title of this article read: “Restaurant Trends 2013—Why Today is Yesterday for a Restaurants.”  Restaurant News did not beat around the bush with what exactly they meant, “Your success begins with trends. Not today’s. Tomorrow’s.”  In every industry today, change is happening faster than ever before and this is no different in the food industry— “success favors those who innovate.”  Don’t be left with a bunch of ideas on the drawing board, but rather take a calculated risk using data and trend predictions to ensure your company’s share of the market today, tomorrow, and five years from now.

Restaurant News noted “Four Reasons to Be Ahead of Trends.”

1.    Profitability.

Building your business by discounting will cause it to quicksand, while a new innovative product will bring you premium prices and higher margins

2.    You’re buzz-worthy.

Journalists want to report on new trends and innovations—stories of early adopters catch on and snowball throughout the industry, and sometimes even create a new category as in the case for the Kogi Korean Barbeque Truck.

3.    Success is a Magnet.

By innovating, you build results and the perception of your business.  The brightest want to work with you; from the media to investors to new hires, success attracts the best

4.    You Get a Bigger Piece of the Pie.

It is imperative to commit to innovating because trend-savvy restaurants are market share leaders

Moreover, one way to ensure these four successes in innovation is an idea in the start-up world known as the lean start-up movement (created by Eric Ries).

Test to Learn.

This is a theory that has been largely tested in startups and should be readily used in every industry.  The lean start-up method is systematically testing your new ideas against the assumptions you’re making.  The goal of this testing is to turn your uncertain ideas into credible ideas using the fewest dollars and shortest period of time available.  Restaurants should “test to learn” by launching strategically placed LTO’s in regions that data shows a success rate should occur.  This will allow you to save money by testing on a smaller scale (prevent large loss if market not there), create a buzz around your success, and lastly give you a larger piece of the pie as a mover in your market.  Individual restaurant owners can also “test to learn.”  They can accomplish this by launching test menu items for a short period of time and then gather feedback and sales numbers to determine if it should stay on the menu.  If you can accomplish the lean start-up method, great results are meant to occur.  (Read more about the lean start-up movement here)

I also want to touch on four Restaurants (chains) that I believe are doing a good job (in their respected restaurant / food segment) of innovating through menu development and marketing.

1.    McAlister’s Deli 

 via McAlister’s Deli

Over the last few weeks we created blog posts on food industry news stories, and McAlister’s Deli has been featured in two out of three of these posts.  Why are we featuring them so often?…. because of their constant menu and marketing innovation.  Most recently, they created a Cajun Shrimp menu that showcased Louisiana-inspired seasonings on a Po Boy, Caesar Wrap and Caesar Salad.  A week after launching these new menu items, they took advantage of the Lent Season and featured a special menu for those looking for “meatless” options on Friday’s.  McAlister’s deserves our recognition and yours because of their menu and marketing innovations.

2.    Panera Bread

 via Panera Bread

Throughout the past few months I have constantly seen advertisements for Panera’s new menu items (including new flatbread sandwiches and  pastas).  These advertisements enticed me to try these new items and I can admit that they are quite delicious.   In addition to constantly innovating with new menu items, Panera Bread is launching a new marketing campaign–”Live Constantly & Eat Deliciously.”  Panera wants to create a long term affiliation with its customers by doing good deeds.  ”The campaign urges individuals to join with others to create online circles of five friends on Panera’s Facebook page. For every circle of five friends formed, Panera will work with its Foundation to provide a bowl of its Low-Fat Vegetarian Black Bean soup to a person in need through its alliance with Feeding America, up to a total of 500,000 bowls [Fast Casual].”

3.    Lyfe Kitchen

 via Lyfe Kitchen

For those of you who have not heard of Lyfe Kitchen, it is a healthy, “socially responsible,” fast-casual restaurant founded by former COO of McDonald’s, Mike Roberts, and Chicago’s Celebri-chef, Art Smith.  Lyfe Kitchen may only have two California stores to date, but franchising opportunities and a lot of good press in 2012 makes us feel like a Lyfe will be opening in a neighborhood near you soon [Chicago Phoenix].  Lyfe Kitchen is still very young, but I believe it will soon be a leader in a new restaurant segment–healthy fast-casual restaurants.  In addition to its restaurants, Lyfe Kitchen can be found at grocery stores as well.  More and more people are pushing to healthier food options and innovating your menu now will help you compete with these up-and-coming brands.

4.    Taco Bell

 via Taco Bell

Taco Bell Doritos Locos Tacos sales reached 350 million tacos sold in less than a year, and they will soon be launching their Cool Ranch Doritos Locos Tacos.  Taco Bell’s partnership with Frito Lay may have been questioned at the beginning; however, in the end it has been proven to be extremely successful for both parties.  Innovation can occur in all restaurant segments and Taco Bell has proven this in the Fast Food industry.  Recently, we not only featured them in our industry news update for the Cool Ranch Doritos Locos Tacos, but also for their Lent menu items that included its Bean Burrito, 7-Layer Burrito, Cheese Roll-Up and Crispy Potato Soft Taco.

UPDATE (2/20/2013): After reading an article written on February 20, 2013, in  QSR Magazine, I think Captain D’s deserve a mention from us as well.  

5. Captain D’s

via Captain D’s

Innovation can be tricky because you do not want to go away from your core competency; however, after reading this article about Captain D’s you will gain a clearer understanding of just how powerful innovation can be.  After struggle for years, Captain D’s saw its first positive same-store sales increase in more than eight years.  When asked how Captain D’s got out of this slump, Phil Creifeld (CEO/President of Captain D’s) said, “although the brand is uniquely positioned in the marketplace and unit economics were “solid,” it simply needed a major rejuvenation… And beginning in 2011, through some new blood; upgraded food quality and menu items; improved marketing and branding; and a physical makeover, it got just what it was looking for—and more.” [QSR Magazine]

Now, I am not telling you to go change your entire menu or add Asian menu items if you are a Mexican cuisine restaurant; however, I am telling you to look at this example and learn how innovation and strategic planning can save your restaurant.

UPDATE (2/27/2013): Check out SmartBlog on Food & Beverage Innovations and Trends.

Came across this blog post about “A Behind-the-scenes look at “Fast Casual Nation”.”  Figured it related to this blog post and wanted to share the link.  In this post, Jessica Bryant talks about  “Fast Casual Nation,” a Web documentary series that highlights innovative concepts and restaurants in the fast-casual segment, is wrapping up its first, 10-episode season.

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Change and innovation can sometimes be overlooked in the food industry; however, now more than ever it is important to innovate.  You may be stuck right now with questions on where to turn for help… At Food Genius we recognize the importance of strategic planning, spending your time & money wisely, and the importance of staying ahead of the competition.  Thus, we have set out to help you sort through all the noise in food data & trends.  We will help you in a couple different ways: 1) Follow our Social Media accounts, 2) Sign-up for our “Newsletter Updates”, 3) Check out the trends we captured from searching the Internet during the months of December & January—2013 Food Trends, and 4) Get access to Food Genius Reports before you are left scrambling for answers.

We want to help your business succeed, so please do not hesitate to contact us if you have any questions or want our valued input.

**To read the entire article from Restaurant News and see 25 Trends to watch for from AarronAllen, please click on this link.

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 About the Author: Jack DeTrempe is a Marketing Analyst at Food Genius.  He graduated from Miami University (Miami Ohio) in May 2012 with a Major in marketing and Minor in Entrepreneurship.  He joined the Food Genius Team at the end of October 2012.  He has worn many different hats at Food Genius including the following roles: content marketing, sales & lead generation, social media marketing, industry analysis, and menu data analysis.