•Through differentiation of consumer experience and fresh, high-quality menu innovation, Fast casual restaurants have enjoyed trade-down from casual dining patrons who are more value-minded and trade-up from quick service diners who are looking for a healthier more customizable product in an attractive environment
Growth dynamic is based on many of the new consumer culture affect (web, social and speed) Branded experience (the one element that separates the fast casual) triple effect of quality, service and convenince (vs, QSR focusing on speed - casual on service and fine dining on quality) Five star represents what the future could be in fast casual - I see the separation of the segment once again - Organization has to stay engaged (the thing that has set some of the traps in the industry) is not the brands or even the concepts (QSR Casual etc) but instead staying engaged with the consumer (this is the foucs) going where the conversation is - not waiting again - a whole consumer segment has risen on their own.
Talking Points: •Fast casual continues to be the darling segment of the industry, setting the bar for quick service to measure against. •Chains in this segment represent many of the fastest growth concepts in the limited-service industry. •Casual Dining chains will continue to struggle with the growing competition from Fast Casual by lowering price mix and quick service chains will continue to improve the quality of their menu offering at higher price points.
PANELIST
Paul Barron
EVP & Publisher Fast Casual.com
Chairman Fast Casual Alliance & Fast Casual Executive Summit
Fort Lauderdale, FL
Copyright 2009 Fast Casual Alliance
PANELIST
Daren Tristano
Executive Vice President
Technomic Information Services
Chicago, IL
Copyright 2009 Fast Casual Alliance
PANELIST
Louis Basile
CEO/President
Wildflower Bread Company
Scottsdale, AZ
Copyright 2009 Fast Casual Alliance
PANELIST
Don Fox
Chief Operating Officer
Firehouse Subs
Jacksonville, FL
Copyright 2009 Fast Casual Alliance
PANELIST
Husein Kitabwalla
President, Retail Brand Group, LLC
Allentown, PA
Sodexo - Gaithersburg, MD.
Copyright 2009 Fast Casual Alliance
Fast Casual
Heating Up the Restaurant Industry
FAST CASUAL FACTS
Copyright 2009 Fast Casual Alliance
FAST CASUAL FACTS
• Fast casual restaurants will generate roughly $20 billion in sales
in 2009
• The fast casual segment grew 11% in 2008
• 2009 is estimated to grow over 10% in 2009
• The top three chains ranked by sales are Panera Bread, Chipotle
and Panda Express
• Fast casual is the most dynamic and exciting segment in the
foodservice industry today
Copyright 2009 Fast Casual Alliance
Number of Fast Casual Brands
Source - Fast Casual magazine
Copyright 2009 Fast Casual Alliance
Number of Fast Casual Brands
0 175 350 525 700
1996 80
2000
245
2004
389
2008
2012 620
700
Source - Fast Casual magazine
Copyright 2009 Fast Casual Alliance
Number of Fast Casual Brands
0 175 350 525 700
1996 80
60%
2000
245
Growth like this
2004 can result in a
389 slowing segment
2008
2012 620
700
Source - Fast Casual magazine
Copyright 2009 Fast Casual Alliance
Fast Casual Universe
Source - Fast Casual magazine
Copyright 2009 Fast Casual Alliance
Fast Casual Universe
Italian/Pizza Ethnic
2% Coffee
Fresh Mex
Sandwich 19% 7%
Asian
Bakery Cafe 3%
Burger/BBQ Steak
Soup Salad Soup Salad Italian/Pizza
12%
7%
Fresh Mex
Ethnic Burger/BBQ Steak
Coffee 9%
Asian
Sandwich
18%
Bakery Cafe
23%
Source - Fast Casual magazine
Copyright 2009 Fast Casual Alliance
What consumer’s want in their menu
Fine Dine
Casual 5%
11%
Quick Consumer eating habits
32%
• Percentage of food expenditures weekly
Fast Casual
53%
Food Action Group - Consumer Survey, fast casual - 2008
Copyright 2009 Fast Casual Alliance
What consumer’s want in their menu
27%
Quality Taste 33%
Variety Different / Creative
New Flavors
20%
Fine Dine 14%
Casual 5% 6%
11%
Quick Consumer eating habits
32%
• Percentage of food expenditures weekly
Fast Casual
53%
Food Action Group - Consumer Survey, fast casual - 2008
Copyright 2009 Fast Casual Alliance
Age demographics
These people eat at fast casual at
least once per week
Source - Food Action Group 2008
Copyright 2009 Fast Casual Alliance
Age demographics
These people eat at fast casual at
least once per week 62 - up16-24
4% 8%
25-34
16-24 25-34 50-62 12%
35-49 50-62 31%
62 - up
35-49
45%
Source - Food Action Group 2008
Copyright 2009 Fast Casual Alliance
Age demographics
These people eat at fast casual at
least once per week 62 - up16-24
4% 8%
25-34
16-24 25-34 50-62 12%
35-49 50-62 31%
62 - up
35-49
45%
7%
12-25K
101-125K
7%
4% 26-50K
11%
76-100K Income demographics
29%
fast casual consumers
12-25K 26-50K
51-75K 51-75K 76-100K
42%
101-125K 126K Up
Source - Food Action Group 2008
Copyright 2009 Fast Casual Alliance
Most active consumers in Fast Casual
Based on gender & profession - qualifier data: knows
fast casual and visits at least twice per week
Source - Food Action Group 2008
Copyright 2009 Fast Casual Alliance
Most active consumers in Fast Casual
Based on gender & profession - qualifier data: knows
fast casual and visits at least twice per week
0 7.5 15.0 22.5 30.0
Male Professional
18
Male Non-Professional 5
Female Professional
Female - Homemaker
25
College Student 15
High School Student 12
2
Female Non-Professional
8
Retired Male
7
Retired Female
8
Source - Food Action Group 2008
Copyright 2009 Fast Casual Alliance
WHAT IS FAST CASUAL
Fast
Casual
Source - Technomic
Copyright 2009 Fast Casual Alliance
WHAT IS FAST CASUAL
Fast
Casual
First
Rate
Source - Technomic
Copyright 2009 Fast Casual Alliance
WHAT IS FAST CASUAL
Fast
Casual
Fast Service
First
Rate
Source - Technomic
Copyright 2009 Fast Casual Alliance
WHAT IS FAST CASUAL
Fast
Casual
Fine
Ingredients
Fast Service
First
Rate
Source - Technomic
Copyright 2009 Fast Casual Alliance
WHAT IS FAST CASUAL
Full Grown
Appeal
Fast
Casual
Fine
Ingredients
Fast Service
First
Rate
Source - Technomic
Copyright 2009 Fast Casual Alliance
WHAT IS FAST CASUAL
Pay First
Full Grown
Appeal
Fast
Casual
Fine
Ingredients
Fast Service
First
Rate
Source - Technomic
Copyright 2009 Fast Casual Alliance
WHAT IS FAST CASUAL
Fresh
Pay First
Full Grown
Appeal
Fast
Casual
Fine
Ingredients
Fast Service
First
Rate
Source - Technomic
Copyright 2009 Fast Casual Alliance
WHAT IS FAST CASUAL
Fresh
Fair Price Pay First
Full Grown
Appeal
Fast
Casual
Fine
Ingredients
Fast Service
First
Rate
Source - Technomic
Copyright 2009 Fast Casual Alliance
WHAT IS FAST CASUAL
Fresh
Fair Price Pay First
Full View Full Grown
Preparation Appeal
Fast
Casual
Fine
Ingredients
Fast Service
First
Rate
Source - Technomic
Copyright 2009 Fast Casual Alliance
WHAT IS FAST CASUAL
Fresh
Fair Price Pay First
Full View Full Grown
Preparation Appeal
Fast
Casual
Flexible Fine
Offerings Ingredients
Fast Service
First
Rate
Source - Technomic
Copyright 2009 Fast Casual Alliance
WHAT IS FAST CASUAL
Fresh
Fair Price Pay First
Full View Full Grown
Preparation Appeal
Fast
Casual
Flexible Fine
Offerings Ingredients
Friendly
Fast Service
Employees
First
Rate
Source - Technomic
Copyright 2009 Fast Casual Alliance
The “WOW\" of a Fast Casual
Branded Experience!
Copyright 2009 Fast Casual Alliance
The “WOW\" of a Fast Casual
Branded Experience!
What you stand for
Differentiation
Innovation
Brand promise
Quality drives financial performance
Copyright 2009 Fast Casual Alliance
Five Star Value Proposition
A Competitive Advantage
Copyright 2009 Fast Casual Alliance
Five Star Value Proposition
A Competitive Advantage The Five Star
Value Proposition
executed daily
becomes your
competitive
advantage
Copyright 2009 Fast Casual Alliance
Five Star Value Proposition
A Competitive Advantage The Five Star
Value Proposition
executed daily
becomes your
competitive
advantage
P + F + S + A + E = V
Copyright 2009 Fast Casual Alliance
Five Star Value Proposition
A Competitive Advantage The Five Star
Value Proposition
executed daily
becomes your
competitive
advantage
P + F + S + A + E = V
Passion: Brand spirit, values and leadership resides here
Food: Fresh, quality food that’s creative
Service: Attentive to all customer needs
Ambiance: Immaculately clean, décor, restaurant vibe
Execution: Leadership drives all four elements
Value: Brand experience
Copyright 2009 Fast Casual Alliance
Five Star Value Proposition
A Competitive Advantage The Five Star
Value Proposition
executed daily
becomes your
competitive
advantage
P + F + S + A + E = V
Passion: Brand spirit, values and leadership resides here
Food: Fresh, quality food that’s creative
Service: Attentive to all customer needs
Ambiance: Immaculately clean, décor, restaurant vibe
Execution: Leadership drives all four elements
Value: Brand experience
Copyright 2009 Fast Casual Alliance
Passion - Spirit, Values and
Leadership Resides Here
Copyright 2009 Fast Casual Alliance
Passion - Spirit, Values and
Leadership Resides Here
TEAM
Copyright 2009 Fast Casual Alliance
Passion - Spirit, Values and
Leadership Resides Here
TEAM
• Vision
• Values - They should answer the question;
What to do?
• Team needs to believe they are part of something
bigger than themselves
• Charged Up and Ready Everyday
Copyright 2009 Fast Casual Alliance
Food - Great Tasting Fresh Food with
Creativity
Copyright 2009 Fast Casual Alliance
Food - Great Tasting Fresh Food with
Creativity
• Fresh
• Creativity
• Limited Time Offers
• Executable
• Enhances Brand Promise
Copyright 2009 Fast Casual Alliance
Service - Memorable From Beginning to End
Copyright 2009 Fast Casual Alliance
Service - Memorable From Beginning to End
• People are the key
• Make an emotional connection
• Individualize the customer experience
• Anticipate
• Proactive
Copyright 2009 Fast Casual Alliance
Ambiance - The Visual Elements
Copyright 2009 Fast Casual Alliance
Ambiance - The Visual Elements
RETAILTAILMENT – The “WOW” Factor
• Sensorial Experiences
theater vs. kitchen, cast members vs. employees, stage vs. Front-of-the
house
• Relating & Engaging
interactive lighting, enticing seating zones, tell YOUR story
Copyright 2009 Fast Casual Alliance
Execution - Leadership
Copyright 2009 Fast Casual Alliance
Execution - Leadership
• Actions and words must match
• Show Me Training
• Standardize and Measure
• Feedback
Copyright 2009 Fast Casual Alliance
Value - The End Result
Copyright 2009 Fast Casual Alliance
Value - The End Result
• Customer driven
• Memorable
• Tells a friend
• High frequency
• Advocate for the brand
Copyright 2009 Fast Casual Alliance
The Operator’s Challenge
Copyright 2009 Fast Casual Alliance
The Operator’s Challenge
The operator’s challenge is to lead your entire
organization to engage at the following levels:
• Body - Every detail matters, standardize all
business practices and measure results
• Mind - Engaged, attentive, present
• Spirit - Choose your attitude and guiding
values
Copyright 2009 Fast Casual Alliance
Body - It’s in the Details
Copyright 2009 Fast Casual Alliance
Body - It’s in the Details
• Sweat the small stuff (you are building the brand)
• What to measure must align with Brand Promise
• Systematize to replicate success
• Systems that can be executed
• Enforce Standards
Copyright 2009 Fast Casual Alliance
Mind - Present & Engaged
Copyright 2009 Fast Casual Alliance
Mind - Present & Engaged
Present - Moment - Awareness
Copyright 2009 Fast Casual Alliance
Spirit - Intentions Matter
Copyright 2009 Fast Casual Alliance
Spirit - Intentions Matter
• Brand first
• Team driven
• Intentions aligned with values
• Want to serve
• Fun
Copyright 2009 Fast Casual Alliance
Fast Casual In Review
Copyright 2009 Fast Casual Alliance
Fast Casual In Review
• Fast Casual is fastest-growing segment in our
industry
• Branded experiences are memorable
• Five Star Value Proposition is a sustainable road
map for success
• All levels of the organization must be fully engaged
Copyright 2009 Fast Casual Alliance
Fast Casual In Review
Copyright 2009 Fast Casual Alliance
Fast Casual In Review
• Key Trends
Healthy Menu Launches
- Camille’s - Low-cal Slim Smoothies
- Cosi - New Lighten Up menu
- Noodles & Co - You are what you eat ad campaign
Snack-sized Menu Items
- Einstein - Snackout menu
- Au Bon Pain - Low Cal “portions menu
- Chipotle - smaller portions - lower price option (in test)
Natural, Organic Local and Sustainable
- Organic To Go - Certified Organic Retailer
- Wichcraft - cruelty and hormone free practices
- Chipotle - Locally sourced in-season produce
Copyright 2009 Fast Casual Alliance
Q&A for the Panelists
Thank you
Copyright 2009 Fast Casual Alliance
Q&A for the Panelists
• Our panelists are available for questions from the
audience
• For more information about joining the Fast
Casual Alliance go to www.fastcasualalliance.com
• To get this slide deck please visit the FCA website
Thank you
Copyright 2009 Fast Casual Alliance
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