When investing in a franchise opportunity, there are many factors to take into account – from brand recognition and profitability to training and support. However, one of the most important qualities to look for in a franchisor that may not be at the forefront when you’re conducting your due diligence is how well a brand can develop new products and bring them to market.
In the quick-service restaurant (QSR) segment, it’s essential to keep innovating, while still making sure your products achieve and maintain your brand mission and values. With that in mind, franchisors often struggle with successfully and efficiently implementing changes within their system.
Here’s how Smoothie King works to effectively roll out changes in our franchise system – to keep our brand competitive, our franchisees happy and our guests coming back for more:
Creating a Reservoir of Ideas
The first stage in developing a new product concept begins with ideation, which includes a great deal of research. Since everything we do starts with a specific nutritional purpose, it is important to have a diverse range of perspectives and opinions. This is critical during the initial phase of product development. Incorporating data from multiple sources is the best way to ensure the best product innovations.
There are numerous ways to efficiently draw from multiple sources within a franchise system. For example, we host an annual ideation meeting with members from our corporate team, Franchise Advisory Council (FAC) and third-party research firms. There, we discuss relevant trend data, opportunities for growth within the industry and whether we need to fulfill a purpose within our target guest demographics.
In reality, this is an iterative process. We aren’t thinking about new products only once a year. We take opportunities during regularly-scheduled meetings or trade shows to discuss industry trends with other professionals in the field. At quarterly meetings, we meet with vendors, including our juice, fruit and nutritional supplement suppliers, as well as equipment manufacturers. For example, our blender supplier Vitamix, conducts consumer surveys to find out what people are blending at home. Many of the trends that truly take off start out in consumers’ homes.
Similarly, trade shows are a great avenue for networking and brand promotion and can provide insights just as valuable as proprietary market research. Speaking with others within different segments of the same industry – such as food technology and ingredient supply – provides us with many insights we may not be able to access initially.
When the same trends keep rising to the top among different sources, we know this is something we should capitalize on. It’s very important that franchisees know that you have done your homework and researched your options well. Developing this trust is an invaluable part of the process.
Transparency and Open Communication with Franchisees
One of the greatest benefits of a franchise system is the vast network of people within the franchisee community available to provide their input. Franchisees are one of our greatest resources for ideas about new products. They are the ones with first-hand knowledge of the products with the highest demand within their market and among their guests.
By keeping in regular contact with our franchisees, we can work to fill in gaps within certain markets and hear ideas we may not have come up with on our own. For instance, guests at one of our Smoothie King locations were asking about vegan smoothies – which we didn’t initially have on our menu. The franchisee of this store noted this unfilled need in his market and came to us with the idea to introduce them. So, we reworked his original recipes, put it through our development process and tested out those products in focus groups, as well as within that market. We found a great deal of success with that line of smoothies, so we introduced them in other stores, too. Now that line of smoothies is amongst our best sellers.
Our FAC is also involved from the very beginning of our product development process. This allows us to get their feedback and input on new product samples and ideas and how they may play out in their specific market. We also perform field and operations testing for new products before we decide to roll out a change. This helps us ensure we have effective systems and processes in place to support that new product. Including franchisees in this process help them and their team members get excited about what we are working on. Field testing also helps minimize any reservations franchisees may have about the new product, by showing them how they can integrate the product from an operational perspective.
Listening to Feedback
Although we have turned our product development process into a well-oiled machine, it still takes roughly eight to fourteen months to complete a successful rollout. From the research stage to product testing and focus groups, expecting a quicker turnaround is simply not feasible or realistic. Planning ahead, anticipating future trends and then listening to guest feedback are key in ensuring a profitable product that will meet consumer needs. Again, this is why we typically begin the ideation phase more than a year ahead of a projected launch date.
Once trends are identified, a prototype product has been developed and operations have been optimized, it’s essential to introduce the product to guests and get their feedback – through focus groups, surveys or other methods of direct interaction with consumers. We have approximately 50 certified sampling stores where franchisees conduct in-store product testing. Using our franchised locations allows us to receive feedback from the three most important channels in our business – our franchisees, our team members and our guests. Listening to franchisees, team members, consumer feedback and then adjusting and adapting accordingly is the most important step in the development process. When there is consistently positive feedback form all three sources you know you have a product that can produce good results in the field.
Continuing the Success of New (and Existing) Products
While it is important to continue innovating and adjusting your menu, it’s important to maintain a balance between new product announcements, while also focusing on building and maintaining brand identity through product development. We’ve found it works well to layer key branding messages into our new product announcements.
For example, this past year we have begun introducing new and improved ingredients as part of our Clean Blends Initiative, which we anticipate will be a core branding message for the next several years*. As we introduce our new Clean Blends ingredients, we are also introducing additional products using the new ingredients. This allows us to keep introducing relevant new items to keep franchisees interested and engaged, while at the same time reinforcing key branding messages with our guests.
Key Takeaways
Of all the practices mentioned above, communication is the absolute most important. The FAC specifically must feel confident in the engagement and back-and-forth they have with the franchisor – or there is little chance the system of franchisees will feel it. It’s also important that the communication be allowed to flow both ways – to and from the franchisee community.
To help foster this open communication we have a regional meeting so we can present our plans to our franchisees, with our FAC, as one united team. Once everyone understands how our new initiatives lead directly back to our vision and mission, it gives them a sense of purpose and pride in taking on new products and operational innovations. When you can accomplish this on a regular basis, you will truly have mastered the art of bringing new products to market.
*NOTE: Clean Blends is now a core feature of our smoothie bars and brand mission. Learn more here!