The Differentiators

    In these days of stiff competition, limited-service brands must stand out from the crowd. Here are six innovative brands doing just that.
    Growth | September 2015 | Sam Oches


    &pizza’s K Street location

    Today’s limited-service restaurant industry is more competitive than ever. Every year brings forth a new crop of upstart fast casuals looking to steal market share from the hundreds of companies that came before them, while consumers continue to demand higher-quality products and experiences.

    To stay competitive, brands new and old must find ways to do business differently, to innovate in ways that are future-forward, customer-centric, and, most importantly, unique from anything their competitors are doing.

    Looking for some tips on how you can change your business for the better and stand out from the crowd? Here are six ideas executed by six brands, each of which has approached a certain aspect of business in an innovative—and potentially revolutionizing—way.

    Streamline your supply chain

    The farm-to-table movement equipped restaurants across the country with a number of marketable storylines, from the fresh and healthy food message to boasting about relationship building within the community. Scaling local foods, however, has so far proved relatively elusive, which has prevented limited-service chains from joining the movement in a big way.

    Thanks to New York City–based health-food fast casual Dig Inn, though, that might soon change. The “farm-to-counter” brand is tackling its supply chain with a fresh perspective, taking more of a hands-on approach with its sourcing practices in order to make fresh, local foods more accessible.

    Here’s how it works: Instead of connecting with farmers and vendors through third parties, Dig Inn goes directly to the sources, working with suppliers to get exactly what it needs. The fast casual has a distribution center in the Bronx that serves as a supply hub for its 11 restaurants. Adam Eskin, CEO of Dig Inn, says the brand wants to impact the way the world eats food, specifically vegetables. Fresh vegetables are cost-prohibitive to many consumers, he says, and having more control of the supply chain allows Dig Inn to not only support local farmers’ businesses, but also to make its vegetable-heavy menu more accessible to customers.

    “We’ve been able to impact not just the quality long term and how growers think about their own standards, but also cost and accessibility and how we can pass those savings on to our consumers,” he says. “The way we’ve done that so far is we’re really committed to owning the relationship with our farmers, vendors, growers, and providers directly, as opposed to through multiple third parties and layered relationships. When you have multiple folks in between you and your suppliers, that’s when costs tend to go up.”

    Though Dig Inn’s locations are today all in New York, the brand plans to open as many as 500 locations. Eskin says the company is looking into ways it can scale its hands-on supply chain, which includes establishing supply partners well in advance of entering a market and helping farmers scale up along with the brand.

    “We’re looking at the entire market from the really small [farms] all the way up and saying we should be in support of helping all of these folks grow their business,” he says. “Because if they’re growing, that means that more supply is coming online, and if more supply is coming online, we’re able to grow our business.”

    Give your restaurants some character

    At Washington, D.C.–based pizza fast casual &pizza’s K Street location—just blocks away from the White House—three black-and-white images of John F. Kennedy in sunglasses span a long wall opposite the counter. The rest of the sleek, modern restaurant is awash in white, from the brick walls to the communal tabletops to the marble face of the build-your-own-pizza counter.

    Michael Lastoria, cofounder and CEO of &pizza, says the brand refers to its K Street location as “the Other White House,” reflective of that store’s proximity to the eponymous dwelling. But the white finishes aren’t an &pizza specialty; they’re exclusive to the K Street store. Each of the rest of &pizza’s 13 units features its own unique design, every one incorporating culture and characteristics of its surrounding neighborhood.

    “It started with this whole notion that we wanted to connect the store design and the aesthetic to the neighborhoods and communities we served,” Lastoria says of &pizza’s strategy of uniquely designing each restaurant. “The reason for that is we really wanted each store to feel not like a mass-produced product, but rather like the local pizza shop, and doing it with a language that lets you know where you are.”

    That language speaks through the U Street location’s enormous brass ampersand (&pizza’s signature icon), emblematic of that area’s rich jazz history; the Brookland neighborhood restaurant’s photo-covered walls, offering glimpses into locals’ lives; and the Germantown, Maryland, unit’s roller skates, stripes, and polka dots, which provide a sense of suburban youth and playfulness.

    To get a sense of each neighborhood’s personality, Lastoria and &pizza’s head store designer Heidi Guerard canvas the area, interviewing locals and snapping photos to get a sense of what defines each neighborhood. The team then looks for ways to incorporate the existing bones of the real estate; Lastoria says the brand tries to preserve as much of the location’s inherent personality as possible, especially within the more urban restaurants.

    The finished product, he says, creates an atmosphere that is beautiful, warm, and friendly. “There’s an emotional connection that’s being created with our guests and our brand, and it’s a feeling that happens when you walk into one of the pizza shops,” Lastoria says. “That’s what we’re striving for, to create those emotional connections.”

    Put on a smile

    Let’s face it: There are a lot of burgers-and-fries joints out there.

    Burger brands especially must look for unique differentiators when it comes to competing in a crowded field, and that’s not lost on Wayne Humphrey. The chief operating officer at Colorado-based Larkburger, which has 13 locations, says the better-burger brand creates customer loyalty through its hospitality, which is developed through what the company calls Local Relationship Marketing (LRM).

    Through its LRM program, Larkburger trains each store manager to creatively engage with his or her local community, a training process that includes professional development and a library of engagement tactics that can be used to boost brand exposure. LRM manifests itself through charitable giving and employee hospitality that is friendly, inviting, and personable.

    “We absolutely want each manager to be the face of that restaurant,” Humphrey says. “Not only the managers, but each and every employee.”

    He adds that Larkburger can communicate its values through store posters or marketing efforts, but that it’s most effective, natural, and authentic when it’s represented through the employees. That’s why brand executives train employees to converse with customers and encourage them to hand out free food when appropriate. That’s also why the brand has its LARK system, which recognizes Little Acts of Random Kindness from employees; there’s even a button on Larkburger’s POS that lets restaurant track LARKs.

    As a bonus, the increased investment in employees doesn’t just support customer loyalty. It also encourages employees to stick around.

    “We are seeing improved attitude and buy-in, and eagerness for knowledge and eagerness to learn more about Larkburger, more about our food. We know it’s going to translate into longer tenure and better employment,” Humphrey says. “But it’s going to also result in—and we’ve seen it already in some of the restaurants—the interest to make Larkburger a career.”


    Run some numbers

    The term big data has bounced around the industry for a few years now, a sort of catchall term that has so far, at least in retail, been more futuristic idea than tangible operation.

    Now, however, at least one fast-casual chain is taking a bold step into the future by hiring a chief data scientist to lasso the potential that big data provides. Nine-unit Cava Grill hired Josh Patchus in March to help it create an infrastructure for data so it can better prepare for future growth. The D.C.-based Mediterranean concept plans to use data both for consumer-facing purposes—nutritional information, for example—and operational efficiency.

    “You can mine it, extract relevant information, and make the experience better,” Patchus says. “People want to know what their consumers are struggling with, and what their consumers need improvement on. … For us, we have different metrics that we’re trying to figure out, like what our consumers get frustrated with, and really make that an easier process for them, and for our managers and employees, too.”

    When Cava Grill recently opened a location near an existing Cava unit, Patchus says, data was able to help the team drill down exactly how the close proximity might affect traffic patterns in each store. And while some might see data as a tool to flag weaknesses, he adds, Cava Grill hopes to use data more for opportunity.

    “When you bring in data, especially in certain industries, it becomes a finger-pointing tool, and we don’t use it like that at all,” he says. “If the data shows that we need to change, then we’re going to change, and we’re going to help [team members] be a part of that.”

    Don’t take yourself too seriously

    There’s no science to the viral video. Companies are lucky to get hundreds of thousands of views for their ad spots on YouTube; in the rare case, big quick-service brands like McDonald’s and Wendy’s have touched seven figures. But that’s typically a level enjoyed only by the national chains, companies with ad agencies and millions in their marketing budgets.

    Earlier this year, Dog Haus partnered with Millennial-forward news site Buzzfeed on a video showcasing creative sausage recipes. The video, starring Dog Haus culinary director Michael Brown and head sausage maker Adam Gertler, has racked up more than 2 million YouTube views since its March premiere.

    The Buzzfeed video was part of a broader strategy from the “craft-casual” chain, one in which Dog Haus forgoes traditional radio and TV spots in favor of social media marketing and online videos that communicate the brand’s fun, irreverent personality.

    “I think video is what people want to watch. I don’t think people want to read anymore; I think they want to be entertained,” says Dog Haus cofounder André Vener. “So we try to make sure that our videos are the same tongue in cheek as when you walk into a Dog Haus, and we make them kind of funny, let them know that we’re funny, let them know that this place is fun.”

    Vener says social media is Dog Haus’s bread and butter, as evidenced by the number of customers who come into the store and take pictures of their food before chowing down. The company hired a team of young people to direct Dog Haus’s social media efforts, which include engaging with nearly every person who mentions the brand and developing creative content.

    “I think you have to mirror your staff, the team that you hire, to the customers that come in there,” he says. “We’re seeing this younger generation … come in. It’s a hip scene, and times are changing, and different social media platforms are changing. We surrounded ourselves with a bunch of 20-year-olds who live in it, who grew up with it.”

    Dog Haus also has a full-time video department—even the training videos for franchisees are done creatively, with fun and humor in mind—and it intentionally leverages Gertler, a Food Network personality, for offbeat YouTube videos.

    “I guess it’s weird to have a video department and actors on your staff before you hire other people, like a COO or CFO,” Vener says with a laugh.

    Shake up your drink menu

    When cofounders Josh Spiegelman and Lynn Gorfinkle opened Roam Artisan Burgers in San Francisco in 2010, their intent was to create an upscale fast-casual burger joint that used high-quality, high-integrity ingredients.

    That mission extended even to the beverage menu, and today, Roam boasts a diverse drink menu that goes far beyond most other limited-service restaurants. It includes wine and kombucha (fermented tea) on tap, bottled local beers, house-made artisan sodas, and a line of milkshakes produced in-house, made with local ice cream and milks.

    Not in the restaurants? A soda fountain. Spiegelman says that while he and Gorfinkle are well aware of the high margins on traditional sodas, they don’t fit with Roam Burgers’ mission. “We’re not making as much of a margin,” he says. “But we’re OK with that, because everything we do is about our brand and using ingredients with integrity.”

    The innovative beverages are also labor-intensive, which Spiegelman thinks will prevent many other brands from investing in such a program. But while kombucha might not be such a sure thing outside San Francisco—“As we expand into other markets, there’s a bit more education required,” he says—Spiegelman thinks customers nationwide are ready for some new ideas in the beverage department. “People like it here, but I don’t think there’s any reason they wouldn’t like it all over the place.”