Monday, October 25, 2010

Restaurant copy cat marketing causes consternation for hedge funds.

Chipotle Mexican Grill Inc., Panera Bread Co., Domino's Pizza Inc. are the names of companies that hedge fund managers called last week and asked why can’t my “---- fill in the blank company” be like that?. Each of the companies just mentioned has recently cited traffic driven sales growth and or double-digit increases in sales, profits or both.

Restaurant sales have traditionally been tied to unemployment. While unemployment relentlessly hangs around 9.6% many hedge fund managers are either ready to bail out of their restaurant investment or bottom fishing and looking for opportunity.

Out of abundance of caution CEO’s and CMO’s that chose not to lead, but rather copy are now either looking for jobs or additional investors. Chipotle, Panera, and Domino’s built on core brand values while focusing on the customer; and it has paid off. Each leads with clear differentiated positioning.

Sonic Corp., Romano's Macaroni Grill, Wendy’s/Arby’s Group, have the same executives or recycled industry veterans that spent more time on “doing no harm” than researching and focusing on the customer.

Each niche within the industry has winners and losers. Some like Wendy’s/Arby’s group interestingly chose not to lead but copy others first and then go backward. If you were to look at their current salad ad you might think this was the third time around. Yes, different salad recycled ad why? The consumer is dynamic not static, during tough economic times no one wants to stay here and no one wants go backward.

Customers look forward; they want new, different yet familiar products. Successful food retail operators are now adopting Foodservice Solutions® 5 P’s of food marketing: Product, Packaging, Placement, Portability and Price within each niche of the industry. Here is an example of a company moving restaurants moving forward with technomogy:

Hedge fund managers that are bottom fishing and want to run a food company like the one they remember when they grew up be forewarned. The customer has changed and the brand must as well. The food customer is dynamic not static. Those who sit and wait will lose. Success does leave clues and following the customer is one of them.

Outside eyes can deliver top line sales and bottom line profits. Invite Foodservice Solutions® to provide brand and product positioning assistance or a grocerant program assessment. Since 1991 Foodservice Solutions® of Tacoma, WA has been the global leader in the Grocerant niche for more on Steven A. Johnson and Foodservice Solutions® visit or

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