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10.05.2011

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Nothing Ordinary About Quality

How Domino’s and Shake Shack Center Stage Quality to Galvanize Their Brands

We know the place, or know of such a place. The quaint restaurant, locally owned by a couple; she’s the chef, he runs the front. Menus are handwritten and change constantly based on the local catch and seasonal bounty. The food is to die for. The service and ambience is uniquely intimate. There is always a wait of more than an hour to get in (if you can get in at all), reservations need to be made weeks in advance. When one has dined there, it is all they can talk about to friends and acquaintances. Word of mouth is the only advertising needed. It is a solid business built on uncompromising quality, with stakeholders who are driven to excellence, passionate about their craft and driven to delight customers.

Yet, in considering this example, it’s important to consider that companies and brands do not lose their magic and their prescription for success overnight. Instead, it gradually slips away in small almost imperceptible bits over time. A small trade-off here, a cutback there, expansion due to popularity, all based on “sound business rationale”, and one day your business is no longer special, in fact, you’re ordinary.

Considering such an example, how many of us can also recall restaurants, CPG brands, retailers, or any number of products or services (Krispy Kreme, Cosi, or Netflix anyone?), which once pushed beyond an original distinction of quality have faded into the abyss of the ordinary. While prosaic in appearance, mainly because it's such a common everyday word, this business of "quality" is actually of extreme importance today when considering emerging trends in food culture. This is because, at their basic root, trends that coalesce around higher order food experiences (cues to quality which include fresh, artisanal, local) are often at odds with the demands of wide scale growth which imply consistency, standardization of ingredients and overall experience.

Within our ever evolving Culture of Food, which includes diverse institutions, stakeholders and influencers ranging from chefs, restaurants and foodservice to CPG food and beverage and related retailers, we see multiple examples of brands which through the inexorable demands of growth and the consistency required for expansion, often lose distinctions that ladder up to quality. This process of quality under attack, often accompanied by flat-lining sales and declining relevance with consumers, is of great interest since the consumer pursuit of higher quality experiences, either within retail, foodservice or CPG food (e.g., fresh products) continues to redefine most products and services linking to the culture of food (and beyond).

Recent examples within the restaurant industry provide ample evidence of how quality is either carefully nurtured, or through expansion, lost. Consider the two different tales of Domino’s and Shake Shack.

Domino's: A Tale of Quality Lost, and (Possibly) Regained

Unless you've been out of the country, it’s been hard to miss Domino's "2009 Pizza Turnaround" campaign, which amounted to one of the greatest self-critical analyses of lost relevance in the face of changing food culture in recent memory. Fast Company recently documented the chain’s pursuit of quality in its article “Should "Domino's" And "Artisan" Be Used In The Same Pizza Ad?”

“As recently as a few years ago it would have been hard to imagine a chain like Domino’s launching a new pizza line under the name Artisan with a straight face. But times, Domino’s brand persona, and fast food standards have changed. Responding to a marketplace trend that emphasizes quality ingredients and emboldened by the success of its 2009 Pizza Turnaround campaign, in which the chain documented the reinvention of its admittedly substandard core product, Domino's has indeed launched a range of Artisan Pizzas. The move may still provoke some eye rolls, but Domino's has done some heavy lifting to up its credibility in playing the gourmet card.”

“The Artisan lineup includes three flavors, Spinach and Feta, Italian Sausage and Pepper Trio, and Tuscan Salami & Roasted Veggie, all on a rectangular, lighter crust. Not exactly a category-shattering assortment, but the “chef-created” offerings are Domino’s way of planting a higher quality stake in the fast food market and pre-empting a premium player from gaining traction in the mass market pizza sector.” –Fast Company, September 26, 2011

Shake Shack and Danny Meyer

On the opposite end of the restaurant spectrum, consider the story of Danny Meyer, Shake Shack, Union Square Hospitality Group, and quality maintained—despite obvious pressures to “capitalize” on success through replication and franchising. A recent New York Times article describes how Meyer has taken decades to build up not just his highly successful fine dining locations run through Union Square Hospitality Group (which include Gramercy Tavern, Eleven Madison Park, Union Square Cafe), but also Shake Shack, the wildly successful reimagined burger chain, which until recently was located only in Manhattan:

“… Shake Shack began spreading throughout Manhattan in 2008, along the Eastern Seaboard in 2010 and 2011 (Miami and Washington) and now overseas, with branches newly opened in Dubai and Kuwait City. The total number of Shake Shacks now stands at 13 … Shake Shack competes with “better burger” chains — Five Guys, In-N-Out, etc. But the scale and execution are different. Those chains have hundreds of locations and exponential expansion plans. In-N-Out operates two meat-processing plants. Meyer told me the vast majority of Shake Shack’s management “began their careers with us in our fine-dining restaurants,” and the meat comes from Pat LaFrieda, a third-generation butcher who produces a blend of sirloin, chuck and brisket designed by Richard Coraine, former general manager of Wolfgang Puck’s Postrio in San Francisco and now one of Meyer’s partners. As Meyer put it: “There are a zillion variables to a hamburger. What part of the animal went into it. What coarseness. What temperature.” Coraine spent months “tasting and modifying the blend to hit the right chord.” The New York Times, A Movable Feast: Danny Meyer on a Roll, August, 4, 2011

What’s particularly interesting about Mr. Meyer as profiled in the Times article is the documentation of a restaurateur’s worry over equations he makes between replication, expansion and failure (a condition brought on both by his personal quest for perfection as well as family history). Yet, and related, because of the success of both his fine dining locations and Shake Shack, the piece notes: “…for the first time in his career, Meyer finds it impossible to visit all his restaurants in a single day. Ubiquity and hands-on attention — essential to his success — are incompatible with expansion.”

This is a good note to end on. What would happen to companies, brands, products and services if more people worried, as Danny Meyer does, over the perils of ubiquity and lack of hands-on attention? We see over and over that the tension between the demands of Wall Street on “growth” often yields a decrease in quality in the eyes of the consumer, which, if you stop to think about it, is a rather strange inverse relationship to say the least. One thing is certain: taste, quality, and remembering that at the end of the day it’s always about food, nearly always wins out.

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