In an economic climate marked by failure and low sales, fast-casual stores have proven a veritable gold mine.
“Customers have traded down from casual dining, particularly at lunch,” says Ron Paul, president and CEO of Technomic Consultants.
Not surprisingly, quick serves are trying to cash in on the success of fast casuals. Premium menu items are cropping up everywhere from small burger chains to Carl’s Jr., and a few brands have decided to make a complete transition from quick serve to fast casual.
“I think it’s a good strategy,” Paul says. “I just think it’s going to be tough to do it.” Menu upgrades can be hard to get right, renovations take a lot of money and even more time, operational challenges abound, and even after a concept changes, it can be difficult to truly transform customers’ perceptions of the brand.
So QSR set out to see how real chains are making the transition work. We spoke with four concepts—each at a different point in their transformation—to explore the challenges that arise at each stage.
Taking an existing quick-serve menu and upgrading it to work in a fast-casual setting is often one of the first steps in transitioning a brand.
Baskin-Robbins already had a head start when it decided to open Café 31, a fast-casual spin-off concept, in the U.S.
“The idea germinated from one of our ready-launch businesses outside of America in Korea,” says Srinivas Kumar, Baskin-Robbins’ chief global brand officer. In the menu development for a Boston-area location, Baskin-Robbins was able to draw inspiration from Café 31 stores in Asia, where pastry chefs prepare custom-made desserts at a dessert theater, right before customers’ eyes.
That gourmet touch became a driving force for much of the menu at Café 31’s Foxboro, Massachusetts, location, although the company used cultural flavor preferences to update the offerings.
The store offers the same 32 traditional ice cream varieties and the vanilla soft serve that’s available in traditional locations (at the same prices to which customers have grown accustomed). In addition, the company decided to upgrade from Baskin-Robbins’ traditional menu offerings by adding a selection of premium treats including cheesecake on a stick, caramel ginger apple crisps, and ice cream cake by the slice. They’re generally a few dollars more than getting a couple of scoops of ice cream.
But Baskin-Robbins wanted to offer more than a higher quality dessert selection at Café 31. Since fast casuals are so often about enjoying the in-store experience, Baskin-Robbins decided to create menu items that would encourage customers to stay and savor them.
The first, a line of sharing desserts, was adapted from Café 31’s Asian stores, where there already was an emphasis on creating an inviting in-store experience.
“We’re all in a hurry,” Kumar says. “We walk in the streets, or we eat in the car. In most international markets, though, homes are small and people go out and hang around.”
The sharing desserts are made to be enjoyed in the store and can serve three to four customers each. The most popular offering in that category is the store’s ice cream fondue, which offers cake, fruit, and ice cream that can be dipped into melted chocolate. Another menu item, the Bombe, mixes hard ice cream and soft serve to bring different flavors and textures together.
“Those are unique products,” Kumar says. “They tend to be about $12.”
Another new menu item that also encour-ages customers to stay and enjoy their dessert—a make-your-own sundae bar—was inspired by an unlikely phenomenon in the U.S.
“If you look at concepts like Build-a-Bear, it’s really caught on,” Kumar says. “We talked to a lot of young children, and we found that they like to be very interactive.”
At the sundae bar, customers choose which flavors they’d like and if they want one or two scoops. Then they add whichever toppings they’d like.
“That’s been doing really well,” Kumar says.