Focus Brands’ transition to GoTo Foods is about more than just a new name, CEO Jim Holthouser says.
It represents a strategic overhaul and newly unified operating approach across its portfolio, which consists of McAlister’s, Moe’s, Auntie Anne’s, Cinnabon, Schlotzsky’s, Jamba, and Carvel. GoTo Foods operates more than 6,700 restaurants, cafes, ice cream shoppes, and bakeries in all 50 states and over 60 countries.
Previously, the company acted as a holding company for seven brands, an international arm, and a licensing business, each operating independently. Holthouser noted while these brands achieved regional success, their overall potential was hampered by limited scale and operating leverage.
Holthouser recounted how, over the past 4.5 years, GoTo Foods has restructured its operations to foster connectivity and collaboration across brands. The shift to an integrated path has allowed the company to pool resources and create new efficiencies.
“We’ve figured out how to unleash the power of a portfolio, so that one plus one equals four,” Holthouser said, referring to how the synergy between brands has amplified their impact. The CEO shared these insights during a keynote address at the annual QSR Evolution Conference in September.
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GoTo Foods’ transformation includes unified websites and mobile apps and centralized loyalty and data analytics programs. By investing in a single consumer insights platform, the company can make data-driven decisions with an unprecedented level of precision.
Holthouser credited this development to a team effort and expertise from within the company, particularly the work of Urvi Patel, SVP of customer experience and engagement, who joined GoTo Foods with a background in consumer analytics. The restaurant group now has comprehensive knowledge of customer behavior and can gather new insights rapidly.
Holthouser also noted the benefits of centralized revenue management and pricing strategies. With recent inflation rates impacting food costs, GoTo Foods can guide franchisees on pricing strategies that are sustainable and competitive. Before, the lack of centralized systems made it challenging for brands to adjust prices without disrupting the market. With a more connected banner, GoTo Foods can implement cohesive strategies that benefit all brands within its portfolio.
One of the biggest questions Holthouser has fielded since the rebrand is whether the restaurant group will consolidate its loyalty programs. He said concepts like Marriott and Hilton benefit from unified loyalty programs that give customers more options across multiple brands. GoTo Foods isn’t yet prepared for a full integration of loyalty programs since most of its chains are regional and therefore don’t have enough distribution overlap. However, the company has laid the groundwork by standardizing technology platforms and currency across all brands. This creates the potential to launch a consolidated program in the future.
In the meantime, GoTo Foods is capitalizing on new cross-brand opportunities through catering. Building on the success of its McAlister’s and Moe’s catering services, the restaurant group plans to expand capabilities across its portfolio. This move not only aligns with growing demand for diverse, convenient catering options but also enables GoTo Foods to offer clients multiple brands in a single order.
Holthouser pointed to industry data that shows the average catering manager places around 88 orders per year. GoTo Foods brands capture only a small fraction of that business. By uniting its concepts under one umbrella, the company can become a more versatile, one-stop catering provider capable of capturing more frequent orders and driving significant revenue growth.
“When we do that, it’s much more consumer friendly,” Holthouser said. “For example, if I go to [a guest] over here, instead of having seven brands call on you and try to get your customer order, what if I went to [a guest] one time and I presented seven different options? The reality is [a guest] doesn’t want McAlister’s every single day of their life. Some days they want Mexican. Some days, they may want smoothies.”
The company is making strides in its CPG business as well. It’s a venture Holthouser described as a “true competitive advantage.” The company generates over $1.5 billion in product sales annually through grocery and retail partnerships.
The CEO said no other company in GoTo Foods’ space has replicated its scale or impact. For instance, while Carvel is known primarily as a regional ice cream brand in the Northeast, it has captured a significant portion of the market through its CPG offerings. Seventy-five percent of all ice cream cakes sold in the U.S. are Carvel cakes, according to Holthouser. Likewise, Cinnabon products outsell household names in major retailers, with more frozen Cinnabon products sold in Walmart than Sara Lee.
The success of these partnerships extends into quick-service dining. GoTo Foods has collaborated with chains like Pizza Hut, Taco Bell, Wendy’s, and Subway, incorporating Cinnabon items into their menus. This game plan drives sales and builds brand visibility. A recent study revealed GoTo Foods’ products generate approximately 65 billion consumer impressions annually.
“What would that cost me to buy 65 billion consumer impressions?” Holthouser said. “And basically the answer came back, you can’t afford it. … It’s something like $300 million.”
This strategy has paid off, with GoTo Foods recently ranking as the second-largest food licensor in the world, trailing only Hershey. As the company expands its partnerships with major chains like Wendy’s and Subway, Holthouser is optimistic that GoTo Foods will soon claim the top spot. The group wants to replicate its success overseas. Approximately one-third of the company’s distribution is currently outside of the U.S., with active expansion efforts in the Middle East, Australia, and the U.K.
Gift cards present another immediate growth opportunity. Holthouser said that on average, a $20 card purchase translates into $40 of spending. To maximize this revenue stream, GoTo Foods is developing a multi-brand gift card that can be redeemed at any of its seven brands and will soon be available at over 65,000 retail locations. This gives customers more flexibility and serves as an introduction to GoTo Foods’ full portfolio.
The name “GoTo Foods” emerged from a year-long search and careful testing. Starting with over 200 potential names, the company sought customer input to identify one that would resonate on a global scale.
The inspiration for “GoTo Foods” ended up coming from customer language. The agency helping GoTo Foods with research found that consumer feedback consistently reflected brand loyalty.
“They were seeing things like, ‘Moe’s is my go-to burrito joint,’ or ‘Auntie Anne’s is my go-to place for Monday night football,’ ‘Cinnabon is my go-to place for an indulgence,'” Holthouser said. “And we saw this over and over and over again. And so I thought that was really cool to anchor the company around how the customer thought about us.”
The restructuring also gives franchisees access to data, marketing resources, and systems that drive growth. For example, the company’s digital platforms, which now operate on a unified structure, allow for updates to be applied simultaneously across brands, saving time and money.
Operators have responded positively. By streamlining and centralizing operations, ad fund efficiency has grown significantly, with 70 percent of each dollar benefiting the consumer compared to 30 percent four years ago. This efficiency, paired with strengthened data analytics, loyalty programs, and pricing tools, has transformed the brand experience for both consumers and franchisees.
“This is enabling us to serve franchisees better than we ever have,” Holthouser said. “Now again, it’s a change. We talked about changing here and changing here and that is really the challenge. When you’re dealing with a big ecosystem like we’ve got, it’s just bringing people along. It takes a little time, a lot of education, some patience. But I think we’re just about there.”