4. Today, Rubio’s needs both
a small and smart partner
❚ Your success has to really matter
❚ Entrepreneurs need to be surrounded by
entrepreneurs
❚ Smart people save time and money
5. Our Job: Increase Transactions
❚ Right Strategy
❚ Right Message
❚ Invested Wisely
6. What business is Rubio’s NOT in?
❚ Baja experience:
❙ Baja promise unclear
❙ Facility not experience focused
❙ Baja is not as rich a vein to tap as your food
❚ QSR:
❙ No drive-thrus
❙ No fill-up for under $3.00
❙ Serve alcohol
❚ Fresh Mex:
❙ Price of admission
❙ Crowded moving toward generic standing
❙ No competitive separation
7. “FRESH” is the price of entry
❚ - “FRESH Mex Pledge: Hey! It doesn’t get any fresher than this!”
❚ - “All of our products are made in our restaurants from FRESH ingredients”
❚ - “When you keep life FRESH, things get interesting”
❚ - “Every item you order is made FRESH for you as you order it”
❚ - “FRESHNESS You Can Taste”
❚ - “Hot. FRESH. Just For You!”
❚ - “FRESH (never frozen) dough”
❚ Etc.
8. What business is Rubio’s in Today?
❚ Rubio’s is in the Fast Casual Seafood business
❙ “Home of the Fish Taco”
❙ Majority of Rubio’s sales include a Fish Taco
❙ Seafood is what Rubio’s is identified with
❙ Rubio’s Fish Taco credibility led to Lobster and Shrimp
successes
❚ But, a seafood dominated business is limiting
9. QSR / Fast Casual Continuum
QSR Fast Casual
- <––––––––– Average –––––––––> +
Check
10. What business should Rubio’s
be in tomorrow?
❚ Fast Casual Seafood, Chicken and Beef
Grill business
❙ Grill = more transactions
❙ Grill will drive mix of chicken and beef products
❙ Grill will increase dinner opportunities
❙ Grill = fresh, taste and health
11. Move Beyond Fresh to FLAVOR
❚ Fresh is not a “WOW” anymore
❚ Flavor is the end benefit
❚ The language of selling food is changing:
❙ “Terms like marinade, peppered, carmelized,
smoked, poached and toasted are what’s next,
because they are more flavor descriptive”
(Source: Trends & Solutions)
12. Who’s seeking flavor?
❚ 18-24 year olds, “want it all: spicy, rich, creamy, crispy and combination
of textures too”
❚ Aging Boomer taste buds will add a physiological requirement
for more intense flavors
❚ Boomers, well-traveled and educated, are seeking more
provocative, flavorful food
❚ “Minority Majority” swiftly approaching and influencing
flavor trends
❚ Salsa is number one condiment in U.S.
(Source: Trends & Solutions)
14. Broaden and Focus
❚ Adults 18-44 (female skew) Core 25-44
❙ 18.6% Baja Fresh’s customers in LA are 18-24
❚ HHI $45,000 plus
❚ Household size 2-4
❚ “Flavor Seekers” (includes “Cravers”)
❙ More inclusive of family/friends (will help to drive dinner)
❙ More discerning tastes
❙ Encompasses diverse age groups
(Source: Scarborough LA, 2001)
15. What they’ll do for flavor
❚ Flavor Seekers will sacrifice a little money
for flavor
❙ They’ll drive by a closer KFC to go to El Pollo
Loco
❙ They’ll drive by a closer Baskin Robbins to go
to Ben & Jerry’s
❙ They’ll drive by a closer Ralph’s to go to
Trader Joe’s
16. Rubio’s Has Flavor Credibility
Los Angeles Taste Quality Temp.
Rubio’s 87% 89% 85%
Baja Fresh* 86% 88% 86%
In-N-Out* 90% 89% 90%
La Salsa* 76% 74% 78%
San Diego
Rubio’s 84% 88% 87%
In-N-Out* 89% 85% 90%
El Pollo Loco* 87% 85% 85%
*Approximate percentages
(Source: Quick Track LA and SD, 2001)
17. Rubio’s Positioning
Rubio’s is the fast/casual restaurant
for flavor seekers who are looking
for the best taco and burrito
experience outside of Baja
18. Benefits
❚ Food is primary and flavor is the difference
❚ Establishes Rubio’s as the standard to judge
other Mexican fast casual food against
❚ It repositions other Mexican food places NOT
inspired by Baja as less satisfying
❚ Adds VALUE to the brand
19. 19
Price Per Unit Analysis
RUBIO'S BAJA GRILL P r i c e Weight (oz.) Price Per oz.
Grilled Chicken Taco $2.29 4.27 $0.54
Carne Asada Taco $2.29 4 $0.57
Baja Grill Burrito (Chicken) $4.69 11.47 $0.41
Shrimp Burrito $4.89 12.27 $0.39
Lobster Burrito $5.19 10.93 $0.47
Fish Taco $1.89 3.4 $0.56
BAJA FRESH P r i c e Weight (oz.) Price Per oz.
Original "Baja Style" Taco - Chicken $1.85 4 $0.46
Original "Baja Style" Taco - Steak $1.85 4 $0.46
Baja Burrito (Chicken) $5.15 16 $0.32
Baja Burrito (Steak) $5.15 12 $0.43
LA SALSA P r i c e Weight (oz.) Price Per oz.
Chicken Taco $2.25 2 $1.12
Steak Taco $2.25 2 $1.12
Chicken Burrito $4.95 8.8 $0.56
Steak Burrito $5.45 8 $0.68
EL POLLO LOCO P r i c e Weight (oz.) Price Per oz.
Chicken Soft Taco $1.69 4 $0.42
Classic Chicken Burrito $2.39 6.4 $0.37
IN-N-OUT BURGER P r i c e Weight (oz.) Price Per oz.
Cheeseburger $1.65 2.4 $0.69
Double Double w/ Cheese $2.50 5.6 $0.45
S U B W A Y P r i c e Weight (oz.) Price Per oz.
6" Club Sandwich $3.99 6.4 $0.62
6" Turkey $3.59 7.2 $0.50
6" South West Chicken $3.69 5.6 $0.66
20. Driving Transactions
❚ Price/value is a subjective conclusion
about a brand
❙ Starbucks charges $1.70 for a 20 oz. cup of coffee,
IHOP charges $1.60 for a “bottomless cup” and
7-Eleven’s price is $1.19 for 20 oz.
❙ In-N-Out overachieves in price/value because of their
brand halo.
❙ Baja Fresh & El Pollo Loco underachieves when you
consider their perception scores vs. actual price and
portion.
21. ❚ It’s time for Rubio’s to make an “all out
assault on value!”
❚ But, Rubio’s can’t let promotions move
them closer to QSR
Driving Transactions
22. QSR Cautions
Lessons to consider…
❚ Carl’s Jr. value menu
❚ Burger King’s 99¢ Whopper Program
❚ Tactics that become strategies that
become layoffs
23. How can we create
fast/casual value?
Test 99¢ Fish Tacos when you purchase any
Burrito everyday after 3pm
❙ Drives transactions during the dinner hour
❙ Transaction benefits of 99¢ with less average
check erosion
❙ Leverages Rubio’s Fish Taco equity to generate
more Burrito trial and usage
24. How can we create
fast/casual value?
Test $6.99 “Surf & Turf One-Bite Challenge”
Purchase a Steak Baja Burrito and Lobster Taco
and if you’re not satisfied, get your money back!
❚ Increases trial of Steak Burrito by leveraging the equity
of the Lobster Taco
❚ Positions Rubio’s as “not just a Seafood place”
❚ Elevates quality by offering a flavor satisfaction
guarantee
25. How can we create
fast/casual value?
Test “Baja Burrito One-Bite Challenge”
Not satisfied? Get your money Back!
❚ Elevates quality by offering a flavor satisfaction
guarantee
❚ Increases trial by inciting “Flavor Seekers” to rush
to Rubio’s
❚ Confident assumptive position
26. How can we create
fast/casual value?
Test $5.99 Dinner and a Movie Promotion
every Wed.
Includes Baja Grill Burrito, Fish Taco and any
Blockbuster movie rental
❚ Increases take-out business
❚ Drives transactions on a typically soft day of the week
❚ Elevates brand awareness and appeal via promotional tie-
in with a “Blockbuster” brand
27. How can we create
fast/casual value?
Test “Happy Hour Specials”
Mon.- Fri. 5-6pm
❚ Mahi Mahi Mondays - $1.99 Grilled Fish Tacos
❚ Taco Tuesdays - 99¢ Chicken & Beef Tacos
❚ Wacky Wednesdays - FREE Taco w/ every Burrito
❚ Thirsty Thursdays - $1 Cerveza w/ Every Combo
❚ TGIF (Thank God It’s FISH!) Fridays - Buy 1 Fish Taco,
Get 1 FREE.
28. Compensation Philosophy
❚ GFDM will provide Rubio’s with the Agency
services they need to be successful while
we earn a fair profit
❚ We will tie our profits on the Rubio’s business to
system-wide transaction growth
❚ We’re willing to put our money where
our mouth is