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Reporting by Blair Chancey, Sam Oches, Daniel P. Smith, Robin Van Tan, Barney Wolf & Lori Zanteson
1. BK Sold to Brazilian Investors
Becoming the decade’s biggest restaurant buyout, No. 3 burger chain Burger King Corp. was acquired by 3G Capital, a New York firm backed by Brazilian investors, for $3.3 billion in September. —BC
2. The Food Truck Obsession
Undeniably, 2010 was the year of the food truck. From Top Chef Masters stars like Ludo Lefebvre’s LudoTruck to Burgerville’s Nomad to small chains like Sweet- greens ’ Sweetflow, mobile concepts seemed to be on everyone’s mind (and tweets) in 2010. Although bigger chains including Subway and Dairy Queen have explored the idea, none has gotten the revenue stream rolling in a big way just yet. Perhaps that’s what 2011 has in store. —BC
3. Panera’s Secret to Success
“We didn’t cut prices; we did stress products that gave us higher gross profit. We introduced a Chicken Cobb Salad, for example, that costs us maybe $1.50 but that we could sell for $8. That’s more profitable than a chicken sandwich, which sells for $7.50 and gives us $5.50 back.” — Former Panera CEO Ronald Shaich on how Panera managed to stay profitable during 2010’s recession —DS
4. Passage of Health Care Reform
Despite industry opposition, the health care reform bill was signed into law this March. Although the changes do not begin to affect employers of 50 or more staff until 2014, the issue was hotly debated and widely covered by national and trade media alike this year. —BC
5. CKE Sold in April
CKE, which operates Carl’s Jr. and Hardee’s, was sold for $1 billion to Apollo Global Management, a private-equity firm that assumed the company’s debt. That deal went through after another private-equity group, Thomas H. Lee Partners, refused to match Apollo’s higher offer.
Although Hardee’s is weathering the recession, its sister company saw 7.4 percent same-store sales declines in the most recent quarter. The company points to high unemployment and the bad California economy for its sluggish performance. —BW
6. From One to 1,000
Chipotle founder Steve Ells never intended to expand beyond one store, merely hoping the original Chipotle would help finance his own restaurant. Seventeen years later, in 2010, Chipotle opened its 1,000th restaurant, relishing its place as a dominant fast-casual player. —DS
Big Changes in Church’s Leadership
Although the company was bought by Friedman Fleischer & Lowe in 2009, the big management changes didn’t come until this year. Here’s who joined the team in 2010.
7. Malin Benicek, senior director of quality assurance
8. Andy Bonaparte, vice president of advertising
9. John F. Bowie, president of U.S. operations
10. Will Costello, executive vice president of supply chain
11. Kevin Houston, senior director of research & development
12. Louie W. Mele, member of board of directors
13. Kirk Waisner, vice president of research & development/quality assurance —BC
14. Leaders Demand Compensation from BP
“The rest of the world and the rest of America need to know that it’s safe to get back in the water,” said Rip Daniels, vice president of the Mississippi Gulf Coast Tourism Commission, before a Congressional committee in July.
Alongside Daniels were several hospitality industry leaders seeking compensation from BP after the explosion of its Deepwater Horizon oil rig on April 20.
Although BP dedicated $20 billion to repay citizens affected by the oil spill, which brought tourism in the Gulf Coast region to a halt, industry leaders demanded an additional $500 million in marketing dollars from the company to restore consumer confidence in the region and encourage visitors back to the Gulf Coast.
“Many ask if there’s oil on the doorsteps of New Orleans; and New Orleans is miles inland,” said Ralph Brennan, president of Ralph Brennan Restaurant Group in the Louisiana city.
Along with Brennan, Keith Overton, chairman of the Florida Restaurant and Lodging Association, explained that while Florida was not affected by the oil spill and subsequent tar balls, a recent survey of consumers showed it was perceived to be the No. 1 state suffering from the accident.
Unfortunately, consumer misperception seemed to be reality this summer as hotels that would traditionally be at 80–90 percent capacity were at about 30 percent because consumers were scared to visit.
Struggles over compensation for damages and lost profits in the region are expected to stretch into 2011, if not further into the new decade. —BC
15. Domino’s Fesses Up
No quick serve has drastically changed its signature menu item’s recipe quite like Domino’s did at the beginning of 2010. Even more surprising than the change in ingredients, though, were the marketing efforts to push the new pie. Rather than focus solely on the new offering, the company created advertisements that had its own executives telling customers that the old pizza recipe was no good.
“What consumers were looking for was honesty and transparency because nobody was giving it to them at that point,” says Russell Weiner, chief marketing officer for Domino’s.
The honesty paid off: Same-store sales in the first quarter of 2010, when the advertisements ran, increased 14.3 percent over 2009. —SO
16. Arby’s Taps New President
With U.S. systemwide sales falling almost $150 million and with store counts dropping by more than 150 units in 2009 from 2008, Arby’s needed a jolt in 2010. Enter Hala Moddelmog, who became the chain’s new president under parent company Wendy’s/Arby’s Group Inc. in May, replacing former president and CEO Tom Garrett. Moddelmog will use her previous experience as president of Church’s Chicken, a position she held from 1995 to 2004, to jumpstart the struggling sandwich brand. —SO
17. Free WiFi for Everyone
McDonald’s decision to offer free WiFi at all its restaurants forced Starbucks and others to ditch their paid services and follow suit.
“Customers are increasingly requesting, even expecting, free WiFi,” says H.G. Parsa, professor of hospitality management at the University of Central Florida in Orlando. —BW
18. Heinz Debuts New Packet Design
Necessity is the mother of invention, and apparently the old saying is also true for the mother of all ketchup companies—Heinz. At the beginning of 2010, the company debuted its new Dip & Squeeze design, the first change to Heinz’s ketchup packet in 42 years.
“[It] was really a package pulled together by the needs and insights of our consumers,” David Sykes, senior brand manager for Heinz Ketchup, said of the new design when it launched.
Customers can either peel back the lid for easy dipping or tear off the edge of the package and squeeze out the ketchup as normal.
Each package contains three times as much ketchup as the old packets—a design change that was incorporated because Heinz discovered the average consumer uses three of the 9-gram packets for one order of medium or large fries.
“Because we addressed the messiness issue and it’s easier to open, moms now feel more confident letting their kids use this package in the backseat,” Sykes said. —BC, RVT
19. Flavors Heat Up
This year, concepts from Chick-fil-A to Subway turned up the heat with new, spicier menu offerings.
“If you look at what’s happening on quick-serve menus today, there are so many more spicy choices than there ever were before,” says Lynn Dornblaser, director of CPG Trend Insight at Mintel. “Consumers are looking to restaurants for flavor profiles that they wouldn’t do themselves or that they wouldn’t be able to duplicate at home—especially now during the recession.” —RVT
20. Taco Bell Drive-Thru Diet
Taco Bell rang in the year by holding the fat calories and bringing on the “Frescolution” with its Drive-Thru Diet menu. The Frescolution is a pledge to be active and eat better by choosing from seven Fresco items on the menu that all contain less than 9 grams of fat. With calorie reductions of 20–100 compared with regular menu items, the Fresco Burrito Supreme Chicken or the Fresco Ranchero Chicken Soft Taco ensure that diners like the company’s diet sensation Christine Dougherty can have their fast food and skinny jeans, too. —LZ
21. New Segment Emerges: Flex Casual
Maybe it was the economy forcing diners to spend less or maybe it’s just Americans’ increasingly busy schedules, but casual-dining chains are being forced to loosen the reins on their segment and try their hands at quick-service models instead. Brands that took the quick-serve plunge this year included East Coast Wings & Grill, Denny’s, and Huddle House. —BC
22. 4food Puts Technology on the Menu
Q: What do you get when you cross a burger joint with Apple technology?
A: 4food restaurant in New York City.
Stocked with iPads and Androids for online ordering, 4food is the first quick serve of its kind to make such a tweet with social media. 4food relies on social media to extend powerful word-of-mouth marketing. Customers who register an account can create their own burger, name it, and promote it on websites like Facebook, Twitter, and Foursquare. Each time someone orders that burger, the creator gets a 25-cent store credit, as well as $12 just for registering. —LZ
23. Three Signs Fast Food is Officially Part of Pop Culture
- Cupcakes Get a Reality Show Three years ago, sisters Sophie LaMontagne and Katherine Kallinis worked corporate jobs. But in June, the two owners of Georgetown Cupcake became the stars of TLC’s reality TV show, DC Cupcakes. TLC chose to feature the pair after their concept opened in 2008 to instant success, quickly selling more than 5,000 cupcakes a day.
- Domino ’s on The Colbert Report Steven Colbert, one of Comedy Central’s resident parody pros, named Domino’s “Alpha Dog of the Week” in January for the ad campaign it introduced to promote its new pizza recipe. On the segment, Colbert pokes fun at the brand for admitting “universal condemnation of their product”—and then asking customers to come back for more. “Is that pizza, or did an angel just give birth in my mouth?” Colbert asks after tasting the new recipe.
- KFC Twitter Tag Starts ‘Trending’ QSR’s 2010 pop culture list wouldn’t be complete without mentioning KFC’s Double Down. The menu item—which swaps out a bun for two fried chicken patties around bacon, cheese, and the Colonel’s sauce—was announced April 1. (Some bloggers and reporters have said that they first thought KFC’s announcement was an April Fool’s joke.) Just one of the many signs that the breadless concoction was the most buzzed-about thing to happen in the industry this year: #doubledown started trending on Twitter. —RVT
24. Deckers, Blaze Modern BBQ, and Laughing Noodle
Locations: Lebanon, Tennessee; Lafayette, Indiana; and Springfield, Ohio
Opened: July, August, and September
“They’re distinctive tastes that our customers have told us they’re interested in,” says Jamie Richardson, vice president of White Castle, which developed the brands. Deckers offers triple-decker sandwiches made with anything from Italian cold-cuts to peanut butter and jelly; Blaze is what Richardson calls slow-cooked barbecue served fast; and Laughing Noodle’s menu includes a variety of pasta-based dishes.
The Twist: All three concepts offer White Castle customers more upscale options in addition to their much-loved sliders. Each is being tested in separate (pre-existing) White Castle stores that were renovated and are now operating as cobranded locations. —RVT
25. Food Costs on the Rise
Agricultural prices in the commodity markets were volatile, although prices rose overall. Cattle futures in mid-September rose to the highest level in nearly two years before falling back, while hog prices were more than 10 percent higher through the third quarter.
Prices were up for chicken and turkey, too, while grain prices were also rising.
All that could put pressure on restaurant operators’ margins.
“The restaurants that locked in prices through contracts are reporting better year-over-year food costs, while those that didn’t have seen their gross margins take a beating,” says Steve West, a restaurant industry analyst for St. Louis–based investment firm Stifel, Nicolaus & Co. —BW
26. Drive Thru Catches on in Fast Casual
In February, Panera Bread opened a drive-thru unit in the Glendale, California, Hilton Garden Inn, one of just a handful in the system.
Drive-thru services were also unveiled at other unsuspecting outlets, including Robeks Fruit Smoothies & Healthy Eats, and discussed at others, such as the reinvention-charged Jamba Juice. As quick-service brands seek new, convenient ways to serve customers, drive thrus are expected to play a more substantial role in 2011. —DS
27. Coca-Cola Freestyle Crew Version
Coca-Cola rolled out a crew version of its Freestyle beverage-dispensing machine this year and is testing it in multiple markets.
Quick-serve crews now have at their fingertips 106 beverage brands and 81 nonillion (that’s 81 with 30 zeros) possible beverage combinations. —SO
28. Skinner Defends Ronald McDonald
“The answer is no. He is a force for good. He communicates effectively with children and families around balanced, active lifestyles. He does not hawk food.” — McDonald’s CEO Jim Skinner in response to critics’ calls for the retirement of Ronald McDonald —DS
29. Secret Sodium Reductions
A salty menu item is a tasty menu item. Or at least that’s what most consumers seem to believe. Which is why, although many brands such as Boston Market and Pei Wei have jumped on the sodium-reduction bandwagon recently, they’ve been keeping it on the down-low.
“For most health trends, companies are very good about telling everyone what they’re doing so they get credit for providing healthier options,” says Mintel’s Dornblaser. “But what we’ve seen with sodium is exactly the opposite.”
Concepts have typically been sending out a press release about the changes, but do little else to publicize it.
“The idea is to reduce sodium a little now, wait for customers to get used to it, then reduce it a little more, and continue that process,” Dornblaser says. “That way it’s not a jarring change like it would be if you decreased sodium by 30 percent all at once.”
The strategy helps restaurants address concerns voiced by consumer advocacy groups like the Center for Science in the Public Interest without alienating customers who are more concerned with flavor.
“It puts them in a good position,” Dornblaser says. “Sodium reduction will continue to be a big issue going forward, so concepts who are looking into low-sodium options now will be poised to say, ‘Here’s what we’ve already started to do.’” —RVT
30. Light at the End of the Tunnel
“Cautious optimism is definitely the watch word for 2010. Obviously, there will be no rebound to prosperity in 2010 … but the entrepreneurship, optimism, and flexibility of restaurant operators will show that, no doubt, there can be success achieved by many members of the [restaurant] community.” —DS
— Hudson Riehle, NRA senior vice president of research and knowledge
The Industry Gives Back
Quick-service restaurants—and their customers— displayed a giving spirit in 2010.
31. Little Caesars ’ “Cell Phones for Soldiers” campaign offered postage-paid packages for mailing in a retired cell phone. Each cell phone resulted in a 60-minute calling card given to U.S. troops.
32. KFC went pink in 2010 to benefit Susan G. Komen for the Cure, including painting a Louisville KFC pink and ditching the Colonel’s traditional white suit for a pink ensemble. Restaurants also swapped KFC’s traditional red buckets for pink containers carrying the names of breast cancer patients. Fifty cents from the sale of each bucket went to Komen, resulting in a record-setting $4.2 million donation.
33. On Valentine ’s Day, 11 Jersey Mike’s Subs restaurants in the Dallas/Fort Worth area began a month-long campaign to fight children’s cancer. Donating 25 cents from each regular sub sold and 50 cents from each giant sub, operators handed $50,000 to Wipe Out Kids’ Cancer.
34. On June 2, more than 3,500 Tim Hortons restaurants donated coffee sales to the Tim Hortons Children ’s Foundation. The $9.3 million Camp Day initiative allowed 14,000 children to attend one of the Foundation’s six adventure camps in 2010.
35. White Castle and home fragrance guru Laura Slatkin teamed up to release a scented candle recreating the restaurant ’s signature steamed hamburger. Held in a ceramic holder reproducing the hamburger’s packaging, the candle’s net proceeds went to Autism Speaks.
36. In honor of Bruegger ’s “Neighborhood Heroes” program, employees at each of Bruegger’s 293 units selected up to three local civic or nonprofit organizations and delivered free bagel platters as a sign of thanks. —DS
37. McDonald’s Teaches Managers English
The Migration Policy Institute honored the industry’s leading brand in May for its English Under the Arches program. As part of its second annual E Pluribus Unum national awards for exceptional immigrant-integration initiatives, the MPI recognized McDonald’s program to provide shift managers who speak other languages with English instruction. Working with nationally recognized experts, McDonald’s developed a work-based English curriculum that helps immigrant workers gain on-the-job knowledge, skills, and confidence. Leveraging relationships with community colleges known for their expertise in teaching adults English, McDonald’s created a low-cost, high-impact model of workplace instruction that could even be adapted by other brands. —BC
38. PeopleMatter Hire
Released in September, PeopleMatter’s Hire tool helps companies look for talent, allows interested applicants to apply for jobs, matches specific personality and loyalty traits in potential hires to a brand, completes background checks, and processes available tax credits, among other things. —SO
39. Ray’s Hell Burger Gets Presidential Treatment
As a long-time staple of the Washington, D.C., restaurant scene, quick-service concept Ray’s Hell Burger is no stranger to hosting the political elite when they crave the food that epitomizes American culture— a juicy burger. But a special guest dropped by this summer. Along with Russian President Dmitry Medvedev, President Barack Obama and two English-Russian translators sat down for a messy meal of cheeseburgers, fries, and international diplomacy. The meal stood in stark contrast to the white-tablecloth meals that are traditionally expected of presidents and was a signal of the nation’s weak econonimc state and consumers’ continued frugality. The media frenzy that quickly followed put Ray’s Hell Burger in headlines across the nation the next day. —LZ
40. Popeyes’ Service with Speed
Speed and convenience remain the central calling cards of drive-thru business, and Popeyes Louisiana Kitchen worked to improve both. In early 2010, Popeyes completed the roll out of its Service with Speed initiative, which included new store equipment, concentrated training, and employee-recognition incentives aimed at reversing the brand’s struggling drive-thru service. —DS
41. The Breakfast Battle
Subway launched a breakfast menu this year in a bid to carve out a share of the daypart dominated by McDonald’s, Starbucks, and Dunkin’ Donuts. The new menu includes Western Egg & Cheese and Steak, Egg & Cheese sandwiches. Wendy’s also is testing a return to breakfast. —BW
42. Capriotti’s “Marry A Bobbie” Campaign
“If you love it so much, why don’t you marry it?” The once-popular children’s insult became one chain’s marketing campaign this year. Las Vegas–based Capriotti’s invited customers to “marry” its signature sandwich, The Bobbie, at the Little White Wedding Chapel in Las Vegas on July 21. The wedding blessing was part of a Las Vegas advertising campaign, “VoCAPulary,” that created a new Capriotti’s lexicon—including the unusual term Holy ‘Cap’-rimony. —SO
43. Otarian Embraced by the Stars
Hollywood celebrities gave a hefty stamp of approval with a minimal carbon footprint at the opening of the fast-casual concept Otarian in New York City. Celebrity guests Mary-Kate and Ashley Olsen, Vanessa Williams, Mark Indelicato of Ugly Betty fame, and Judah Friedlander from 30 Rock graced the scene of the boutique fast-casual chain with an eco-friendly philosophy. Driven by the principles of vegetarianism and sustainability, Otarian (now five units, including one in London) is the first U.S. restaurant to track the carbon footprint of every menu item. —LZ
44. Paciugo Gelato and Caffè’s Unusual Flavors
Bob Blumer of the Food Network’s Glutton for Punishment joined culinary forces with Cristiana Ginatta, cofounder of Paciugo Gelato & Caffè, to add to the more than 30 flavor combinations handmade daily by Paciugo staff. Mutually inspiring, Ginatta put her signature twist on Blumer’s creative and slightly kooky genius, resulting in four new gelato flavors: Maple Bacon Crunch, Chocolate Chipotle Butter Pecan, Roasted Banana Cashew Heath Crunch, and Durian. —LZ
45. Return of the Deal
2010 marked the return of big financial deals in the restaurant industry, as several large and mid-sized quick-service chains changed hands.
The activity was a function of improved access to capital, pressure on private-investment funds to put their clients’ money to work, and a belief that restaurant sales would increase as the nation’s economic recovery takes hold.
“Private equity has been sitting on the sidelines during the recession and investors are saying, ‘You are doing nothing with my money,’” says Gary Levy, partner and hospitality industry practice director for J.H. Cohn, a New York–based auditing and accounting firm.
“Now everybody has put their toe back in the water, so more deals get done.” —BW
46. SBUX Pulls Drinks from Drive Thru
Starbucks dropped its 12-ounce tall drink from drive-thru menus, while simultaneously adding images of newer items. Although the Seattle-based coffee giant contends the change was aimed at limiting customer confusion, many believe the redesigned drive-thru menu anticipates the federally mandated calorie information chain restaurants must display in 2011, a proactive practice many others might test as well in the coming months. —DS
47. Phillips Seafood Leads Asian Seafood Conservation
Half way around the world from where the three generations before him fished, Steve Phillips, president and CEO of Phillips Seafood Restaurants, a chain of six quick-service and 11 full-service locations, is helping save ecosystems from following the same destructive path as his beloved Chesapeake Bay.
“My grandfather on my mother’s side was a Chesapeake Bay waterman, so he was a crabber in the summer and a fisherman in the winter,” Phillips says. “As a young kid, I used to go out with him to catch oysters. The Chesapeake Bay was a tremendous bounty of seafood with the oysters, fish, and crab. As a young boy, I never thought that would run out.”
Unfortunately, as most know, Phillips’ childhood prediction did not come true. A combination of overfishing, lack of governmental protection of the area, and overdevelopment along its coasts nearly destroyed the fragile body of water and the ecosystems it housed.
As a result, Phillips was forced 20 years ago to source his seafood elsewhere. The company turned to Asia and quickly began witnessing history repeat itself as competition swarmed the fragile ecosystems and began destroying the seafood industry. Armed with the company’s experience with the dwindling resources in the Chesapeake a quarter century before, Phillips and Ed Rhodes, the company’s U.S. director of aquaculture and sustainability, went to work organizing the disjointed economy of seafood producers in Asia.
In 2010 alone, the company initiated talks with the World Wildlife Fund on crab sustainability in Vietnam, led the formation of crab producer associations in Thailand, and helped provide funding to improve crab fisheries in the region.
“We have to do something about it before it’s too late, because on the Chesapeake Bay I’ve seen it happen in my lifetime, and in Asia I’m seeing it happening now,” Phillips says. —BC
48. Unusual Bedfellows
Competition is leading companies to move into atypical venues. Ruby Tuesday inked a deal to take Florida fast-casual chain Fresh Lime Mexican Grill national, while Johnny Rockets and Halsted Street Deli will open fast-casual restaurants in Chicago.
“You see this trend of moving out of your own traditional space for growth,” says Dennis Lombardi, executive vice president, foodservice strategies for global design firm WD Partners, based in Columbus, Ohio. “Everyone is looking over their fence to see if the grass is greener on the other side.” —BW
49. Angus Beef
When McDonald’s and Burger King introduce a new ingredient onto menus, you know it’s a trend, Mintel’s Dornblaser says. And both added Angus beef to their offerings in 2010.
“It’s something that might be a little more expensive for consumers to buy at home just to try, so getting it at a quick serve is an easy way for them to experiment and see if they like the ingredient,” she says. —RVT
50. Energy, Labor Costs Turn Favorable
Restaurant operators received a little help this year from weaker energy markets. Natural gas and oil prices were lower, which dampened electrical and cooling costs and meant that it wouldn’t cost more for consumers to hop in their cars and head out to a restaurant.
And the labor market remains weak, keeping employment costs relatively low. Although the unemployment rate has moved downward, the job market is tight enough that few workers are jumping to other jobs, giving operators a stable, experienced work force. —BW
51. Chipotle’s Big Announcement
In November, Chipotle made a splash by announcing that in 2011, the company would be expanding—but not just in the traditional sense. On top of new Chipotle stores, the company will also be introducing an Asian concept.
“In our minds, we are still very early in our growth cycle,” Chipotle founder Steve Ells said in the announcement. “This Asian restaurant is just an opportunity to see how our model works when we use different ingredients and a different style of food.” —SO
52. Who Needs Royalties?
Feeling stagnant? Many quick-serve brands have adopted franchisee incentives to spark development. Both Taco John’s and Pizza Inn, for instance, introduced royalty-free franchise programs to promote new restaurants.
“Our goal is to find qualified new franchisees and help them get off the ground with a little extra breathing room,” Taco John’s vice president of development Brett Miller says of his company’s program, which waives first-year royalties for qualifying new restaurants. —DS
53. QR Loyalty
QR Loyalty, a new loyalty program provider, launched a tool for the restaurant industry this year that takes advantage of QR codes (square icons that can be scanned by smartphones) for loyalty purposes. Customers simply scan the QR code printed on their receipt with their smartphone, set up a loyalty account using their name and e-mail address, and then scan the receipt on each future visit. Loyalty rewards are sent as gift cards or vouchers to the customer’s e-mail.
“The customer walks away with that receipt and they can interact with it whenever they want,” says Nigel Malkin, cofounder of QR Loyalty. “All they have to do is scan their receipt at any time and collect their reward.” —SO
54. Jamba Juice’s Faux-mercial
In July, McDonald’s made a splash by announcing the launch of a new line of smoothies. But Jamba Juice made an even bigger splash with its response to McDonald’s entry into the smoothie segment. Released on YouTube, Jamba Juice’s Cheeseburger Chill Smoothie commercial was a fake advertising spot promoting a, um, creative new smoothie flavor.
“There’s a lot of smoothie talk right now, and we wanted to find a creative way to be a part of the conversation,” Susan Shields, chief marketing officer for Jamba Juice, told QSR in an e-mail after launching the video.
But the Cheeseburger Chill faux-mercial, which drummed up plenty of online buzz and almost 400,000 YouTube views, wasn’t just a playful jab at McDonald’s. Jamba Juice directed YouTube traffic to a new viral website for the company, where fans could download a $1-off coupon. —SO
55. Goodbye Finance, Hello Franchise
Little Caesars’ latest franchise partners arrive from an unlikely world: finance. Before inking Little Caesars deals, one couple worked at a major U.S. bank, one man had 30-plus years in banking, and another owned a finance company. Franchisors could see a continued influx of such white-collar types, many attracted to ROI and growth potential. —DS
56. New Concept: 1.5.0
Location: Chapel Hill, North Carolina
“We serve local and organic sustainable food all the time,” says RJ LaPorte, marketing manager at Carolina Dining Services, which oversees the brand. “In addition, we used only local or organic sustainable materials during the construction phase.”
The Twist: Since the concept is located in a dining facility on the campus of the University of North Carolina at Chapel Hill, the majority of customers are students. “We really just want to educate them as much as possible about local purchases,” LaPorte says. —RVT
In-N-Out’s Not-So-Secret Menu
Anyone who’s ordered In-N-Out Burger’s 4X4 with cheese fries is familiar with the off-menu, or “secret menu,” trend that went from underground to mainstream this year.
No longer reserved for those in the know, secret menu items are officially out of the bag. In fact, this year In-N-Out even posted the “Not-So-Secret Menu” on its website. The concoctions, which In-N-Out Burger says are just great customer service, are a combination of special requests.
57. Protein Style: A burger wrapped in lettuce instead of a bun
58. Flying Dutchman: Two meat patties and two slices of cheese, with nothing else
59. Animal Style Fries: Cheese, spread, grilled onions, and pickles over fries
60. Neapolitan Shake: Combination of chocolate, strawberry, and vanilla—LZ
61. Flexible Store Formats Foster Growth
In August, FreshBerry Frozen Yogurt Café unveiled its first self-serve outlet. With a rotating selection of flavors and toppings and a by-the-ounce price, the Fremont, California, store joins FreshBerry’s full-serve and mall kiosk options as potential formats, offering flexibility that company leaders say will drive FreshBerry’s expansion. —DS
62. Cart for a Cause
The food truck craze is now a full-on frenzy, and there seems to be no end to who is along for the ride. Even celebrity chefs have climbed aboard, and not just Tyler Florence and his Food Network hit, The Great Truck Race. Local celebrities and popular Los Angeles chefs donate their time and talent to Cart for a Cause, a gourmet food truck administered by St. Vincent Meals on Wheels. The truck roams L.A. streets every Tuesday serving $10 meals unique to each hosting chef. Chefs include Street’s Susan Feniger, Nobu’s Alex Becker, Animal’s Vinny Dotolo and Jon Shook, and The Foundry’s Eric Greenspan, to name a few. When top chefs are dishing gourmet eats at a bargain price for a great cause, what’s not to Twitter about? —LZ
63. Del Taco’s Super Special Show
A new viral video series from Del Taco, the Super Special Show uses offbeat humor and seemingly random gags to appeal to the young male demographic. The Show is featured on the chain’s Facebook page and is hosted by YouTube.
Del Taco’s vice president of marketing, John Cappasola, says the series is a way to broaden the chain’s customer base.
“You have to offer your consumer something that is unique and different and give them a reason to want to be there and spend time with you,” he says. “Ultimately, you’re trying to build that relationship and extend that relationship and give that customer more time with the brand. And, in turn, they obviously give you more time.” —SO
64. Restaurant Stocks Improve
Stock prices of quick-service and fast-casual restaurant companies moved upward generally, despite weak same-store sales in the industry.
Fast-casual shares were led by market favorite Chipotle, which saw its stock jump more than 90 percent in value during the first three quarters of the year. Panera Bread scored a solid 32 percent gain.
Results were more mixed for traditional quick serves. Stock in Yum! Brands, the parent of KFC, Taco Bell, and Pizza Hut, also chalked up a 32 percent gain during the first nine months, and McDonald’s continued its strong performance with a 23 percent gain. But Wendy’s/Arby’s Group and Sonic saw their stock prices fall.
“These haven’t been ordinary times for some time, but we are seeing some slight improvement,” says Tom Forte, director and senior research analyst for Telsey Advisory Group, a New York–based independent equity-research firm. “Same-store sales in August rose for the second consecutive month for the first time since 2007. That is giving investors some optimism.” —BW
65. The Drive-Thru Ban
Baldwin Park, California, the reputed birth of the drive-thru with In-N-Out Burger’s 1948 opening, placed a nine-month ban on the construction of any new drive-in food outlets. Officials in the Southern California town claimed they wanted to quell traffic problems as well as respond to the nation’s growing obesity epidemic. —DS
66. NRA & UnitedHealthcare Team Up
2010 was a big year for the more than half a million restaurant employees in Pennsylvania. In September, the state launched the Restaurant Health Care Alliance, a joint project of the National Restaurant Association and UnitedHealthcare to provide easier access to affordable health care coverage and related products and services. The next move for the alliance? Helping the nearly 13 million restaurant employees across the country gain easier, lower-cost access to health care. —BC
67. Offense vs. Defense
As the economy continued to sputter during much of 2010, competition remained fierce.
Much of the fight focused on the food, as operators tried to drive sales among cost-conscious consumers, both at the value level of the price spectrum and at the upper end, where fast feeders were competing directly with casual restaurant chains.
“There is offense and there is defense,” Forte says.
Defense focuses on value menus that maintain quick serves’ base, particularly young males. Offense means introducing new premium items to appeal to consumers who want a higher-quality product, a move that positions restaurants better for an economic recovery.
This is showing up in the newest incarnation of the Burger Wars. For instance, Burger King launched its Steakhouse XT burger line to challenge McDonald’s Angus burgers and other premium sandwiches, as well as burgers at casual and fast-casual restaurants. —BW
68. Taco Bell’s Super Delicious Ingredient Force
The cartoon characters in the chain’s humorous YouTube videos supported its $2 Meal Deal and Fourthmeal offerings.
The wacky cast was:
Captain Enchilada Sauce
Super Reduced Fat Sour Cream
Commander Seasoned Beef
Dr. Steve Value —SO
69. McDonald’s $1,000 Success
The Foursquare social media tool, in which users “check in” at various locations, spread quickly among quick serves in 2010. But no chain had quite as much national Foursquare success as McDonald’s. The Golden Arches participated in the nationwide Foursquare Day on April 16, offering the chance for Foursquare users who checked in at a McDonald’s to win $5 or $10 gift cards. The offering led to a 33 percent increase in check-ins on the day of the event over the previous day and a 40 percent increase in check-ins the week of the event over the previous week.
The cost of Foursquare Day for McDonald’s? A mere $1,000. —SO
70. The Double Down Debut
The KFC sandwich that by now has earned Internet fame and consumer activist contempt was launched in April and originally thought to be a hoax. To consumers’ surprise, the menu innovation was real and part of parent company Yum! Brands’ effort to introduce more portable options at the chicken brand. Made of two fried (or grilled) chicken fillets sandwiching slices of Monterrey Jack and pepper jack cheeses and two slices of bacon, the Original Recipe Double Down clocks in at 540 calories and 1,380 mg of sodium. Despite the item’s unusual appearance, consumers flocked to try it and even sparked a second Internet rumor—that KFC was creating a sandwich made of only fried chicken skin. That one ended up being a hoax—at least for now. —BC
71. BRIC Countries Debut at Dine America
Goldman Sachs has been watching Brazil, Russia, India, and China (arguably the world’s strongest emerging markets) for years, but quick-serve executives were introduced to their incredible buying capacity at Dine America just this year. One piece of advice for companies interested in international expansion: “It’s not like America,” says Bob Kaufman, vice president of business development for the Coffee Bean & Tea Leaf. “If you expect everything to be the same and everyone to follow your standards exactly, then you’re going to be sorely disappointed when you go into these markets.” —BC, SO
72. Taco John’s My Town Mania
My Town Mania not only gets customers craving Taco John’s West-Mex food, it also gets them revved to win challenges that promise worthy rewards. Accessible from its website and on Facebook, My Town Mania rewards customers for posting online photos and videos of themselves, family, and friends eating Taco John’s food and interacting with the brand. Each mission, which features local neighborhood landmarks and settings, has a value of free food, coupons, or points toward Taco John’s merchandise. —LZ
73. 125,000 Free Songs from Bruegger’s
In an effort to build its Facebook fan base, Bruegger’s decided to do a sweepstake for all of its fans. But instead of doing the traditional food giveaway, Bruegger’s partnered with various music labels to give away free tunes to new and existing fans through its “Music Showcase.” The result was 50,000 Facebook page hits and 125,000 downloaded songs. —SO
Reporting by Blair Chancey, Sam Oches, Daniel P. Smith, Robin Van Tan, Barney Wolf & Lori Zanteson