Innovation
As Rita’s grew, so did the market for quick-service snacks. The industry now sees 7.1 million snack visits a year, according to market researcher NPD Group, and snack-related occasions continued to trend upward last year despite the dismal economic climate. But with more consumer demand for quick-service snacks, competition also increased. According to global consumer, product, and market-research firm Mintel, use of the word “snack” in offerings on menus tripled between 2005 and 2007, with almost two-thirds of those mentions coming in quick-service. Competitors such as tart yogurt concepts Pinkberry and Red Mango continue to pop up, while established players have introduced a slew of new products in recent years, including Taco Bell’s Frutista Freeze and Wendy’s expanded Frosty lineup.
“Within frozen desserts, competition is definitely heating up,” Tristano says. “You’ve got big players in a very mature segment of the industry.”
Rita’s keeps up with the competition by putting its research and development team to work.
“I think product innovation played a pretty big role in the last several years since Jim Rudolph purchased the company,” says Lynn Hoban, Rita’s vice president of marketing.
Under Tumolo’s leadership, the chain added frozen custard to the lineup, paving the way for line extensions like the Misto, a blend of Italian ice and custard, and the Gelati, a layering of Italian ice and custard. On Rudolph’s watch the menu expanded even more. Since 2005, the company has added more than 10 flavors and created three more line extensions mirroring larger trends in the frozen-treats category.
In 2007, when competitors like Cold Stone Creamery and Marble Slab were making customization all the rage, Rita’s debuted its Blendini, a blended treat combining the customer’s choice of Italian ice, frozen custard, and Oreos, Nilla wafers, pretzels, or M&M’s Minis. Its answer to the specialty frozen coffee craze was the Ritaccino, a mixture of custard and ice available in café or mocha flavors. In line with customers’ growing health concerns, Rita’s introduced the fat-free Slenderita soft serve and made sugar-free Italian ice available systemwide in 2008.
“We are students of the industry,” Hoban says. “We’re doing our research, looking at what’s going on around us, and watching the trends.”
Next in the pipeline is a series of cobranded Italian ice flavors—the first of which, Swedish Fish, debuted last month—and a line of frozen custard cakes, which are being tested at select locations and should roll out to more stores sometime in the fourth quarter.
Specialization
Rita’s chameleon-like ability to mimic trends helped it stay hip to the times, but at the heart of the company’s success is its signature product, Italian ice.
“Their Italian ice is their differentiator,” Tristano says. “There are not a lot of places where you can go to get that product.”
Though line extensions and rotating flavor specials have been key to keeping the concept fresh and relevant, Rita’s menu is at its core focused on Italian ice. Therein lies its strength, says Charlie Baggs, president and executive chef at Charlie Baggs Inc., a foodservice consulting company.
“They’ve kept it simple and stuck to what they do well,” he says. “Too many chains try to do everything and lose focus of what their core competency is.”
That, Hoban says, is something Rita’s will not do. Though other snack players such as Starbucks and Jamba Juice, which added sandwiches, salads, and wraps in June, have expanded their menus to include items to bring in customers during other dayparts, Rita’s is firmly focused on its ices and frozen custard.
“We sell frozen treats,” Hoban says. “We’re a frozen-treat concept, and we’ve made a decision to stay true to our core brand.”
The reason for that decision seems to be twofold. For starters, adding more complex offerings would require more preparation in the back of the house, and because most of Rita’s business is done between 6 p.m. and 9 p.m., that would likely increase wait times.