11.162009

frozen yogurt and the future

I read with great interest an article in SmartBusiness about Red Mango and the yummy yogurt chain’s founder, president, and CEO of Red Mango, Dan Kimred-mango_tb_1I’m fascinated by the frozen yogurt chains that have emerged on the cultural landscape in last 5 years.  Pinkberry has probably gotten the most coverage in the press, with its high design aesthetic and celebrity fans, but there are plenty of others in the game including Red Mango.  The category is very crowded with operators of all sizes competing in a relatively small niche with punch cards and discount days.  Building brand awareness and shoring up a loyal customer base are particular challenges, which is in part why I’m so interested in the category (liking fro yo also has something to do with it too!)

In the SB piece, Dan explains his thinking and approach to building the Red Mango brand.  Clearly, this is a guy who gets it.  He believes in the power of his brand and he actively nurtures and protects it.  Here are my reactions to his comments, along with some suggestions for how he might ensure his brand-building efforts continue to be successful as the chain grows.

Good stuff
Dan’s commitment to the Red Mango brand is remarkable:

  • It’s his primary focus. He says, “We always start with, ‘Who do we want to be when we grow up and who are we as a brand?’…We always keep that top of mind in terms of everything we do.”  And he keeps his focus on it.  “If you constantly change who you want to become, the strength of your brand goes away.  If you try to do too much and address too many things, you stretch yourself too thin and really can’t accomplish anything.
  • He’s clearly articulated what the brand stands for and has documented it in a digestible, memorable form.  Unlike many entrepreneurs, he didn’t just assume that his employees would know what is in his head – nor that explaining it once is enough. He created a “brand trifecta” that outlines the brand’s core values and there’s a “MangoFesto” in the form of a poster in each store that explains to employees what the goals and philosophy are.  Dan says, “The thing that you can do that’s not cool is you write [a brand manifesto] once, and you never come back to it, and it gets lost.  You have to make that part of the cultural fabric of your organization.
  • He also uses the brand as a filter for decision-making.  In other words, he operationalizes the brand platform in key decisions about what the company should or should not do.  Frozen yogurt in cones didn’t pass the brand test but papaya as a new topping did.

The next level
Dan’s brand-building efforts have paid off.  Last year, the company received a $12 million cash infusion and they’ve been successful enough to recently launch an aggressive franchise push with the goal of opening 550 locations over the next five years.  That kind of growth will present a host of challenges, not the least of which is maintaining the priority on the brand.

It’s a common problem.  When a company is smaller, there are fewer players who need to “get” the brand.  And as long as the founder (or whatever role the brand champion might play) is actively involved in the daily operations of the business and as accessible to employees, it’s fairly easy to stay on track.  But issues arise as growth inherently brings more people to inculcate, more opportunities to assess, and more touchpoints to align.

A couple of tools and approaches will help Red Mango and other companies aspiring to grow their brands and their businesses:

Competitive positioning. I’ve found the best brand strategies are actually brand platforms comprised of a brand identity (what the brand stands for) and a competitive brand positioning (how the brand compares).  The brand identity is based on the key values and attributes of the brand – including the brand essence or core belief.  The competitive brand positioning outlines the target, the competitive frame of reference and how the brand is optimally positioned in that frame, and the unique benefit of the brand.

Some companies only outline one part of the brand platform but both are important.  You must understand the defining values and attributes of your brand (brand identity) but without a competitive positioning, you aren’t indicating how you will use those core elements to establish competitive advantage.  And you must outline how you compare with other options, but without a solid brand identity, you won’t have the foundation that drives consistency and focus.  Furthermore, the brand identity should remain constant; the competitive brand positioning might change over time as the target audience or the competitive landscape changes.  The two parts of the platform are complementary and symbiotic.

The Red Mango brand essence is outlined in the SB article:  it’s the convergence of health, taste and style.  The piece, however, didn’t speak to the chain’s competitive strategy.  Perhaps a competitive brand positioning exists, but if it doesn’t, I would encourage Dan to clearly articulate one.  And in particular, getting the competitive frame of reference (i.e., the mental file folder that the target puts your brand in) is key.  I’m guessing it’s not simply other fro yo brands (although carving out a unique position in that category is important) – but also other quick serves as well as buy/make at home options.

Empowering stakeholders. In explaining the aforementioned no-go decision on the cone idea, Dan relayed that it was a franchisee who suggested the idea and it was Dan and his executive team that assessed the opportunity.   As the chain grows, it will become increasingly important for others including franchisees to be able to make their own assessments.  Otherwise the executive committee will become a bottleneck for decision-making and a barrier to growth.

I suggest an effort to inspire, inform, and instruct everyone about the brand and how they should interpret and reinforce it in their daily decision-making.   A brand toolbox is an effective way to do so. The collection of tools in a brand toolbox:

  • relays the brand identity and positioning along with the background and rationale to increase understanding and buy-in, and outline principles and examples to guide appropriate brand execution
  • connects people to a purpose and values bigger than themselves, get them excited about working on the brand, and motivate them to adopt behaviors which support it
  • helps people make decisions and take actions that are “on brand” through interactive exercises and decision guides

A brand toolbox can take a variety of forms – workbooks, videos, website, downloads, or a combination of these – the important thing is to develop one that engages everyone who works on the brand.

Aligning stakeholders. A brand toolbox can also be helpful in aligning all stakeholders and their expectations.  At one point, Dan laments, “…you have a lot of outsiders or board members or executive managers who don’t understand how the strategy is executed in regards to having the right resources, then you’re in a situation where you just constantly want to do more and more things without people understanding why you can’t do them.

He’s talking about brand stakeholders and the real need to align them in order to garner their support.  Board members for example significantly influence the value the organization delivers and the way it does business through their strategic, high-level guidance on things like resource allocation and M&A activity. The businesses a company works with to develop, make, distribute, and sell the product — vendors, strategic alliances, distribution channels, service providers, franchisees/affiliates, etc.– are stakeholders in the brand. The number and range of stakeholders only grows as your business grows.

By fleshing out what the brand is and how it is used, a brand toolbox facilitates brand understanding among these audiences.

Imagine your brand as a source of light. In an ideal world, the light of your brand would shine strongly and directly on its intended target. However the current marketplace is far from ideal and so your brand’s light becomes quite diffused and unfocused in the clutter and competition that exists between your brand and its target.

Brand stakeholders actually function as filters for your brand light. Essentially your stakeholders are situated between your brand and its target. Each stakeholder bends and directs the light in their respective roles.

Problems arise when different stakeholders bend and direct the light in different ways. The result? A mess of light rays all pointed in different directions and none focused on the target.

Your stakeholders need to be aligned so that you end up with a laser-like beam of brand value delivered to your target. While it may seem that the people and groups who comprise your brand stakeholders are independently-operating entities fulfilling a specific function or playing a particular role, a more accurate picture is that they are linked together in a brand value delivery chain.

A brand toolbox is a great way to reinforce this linkage.  Sometimes there is a need to protect or segment some parts of a brand toolbox, but generally speaking the more transparent you can be about what your brand is all about and how you’re operationalizing it, the better.

I hope these suggestions are helpful not only to Dan and his team at Red Mango, but to all business leaders who are passionate about their brands and about growth.

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  • But Pinkberry tastes better!

    (meanwhile, I was at Shake Shack in NYC today and I don’t know I’d go there to eat again but I really loved the place, the ideas behind the food, the way the menu is described, the aesthetic of the room, the small touches like the clever phrases on the your-meal-is-ready vibrator, the friendliness and helpfulness of the staff – there’s probably someone very much like your guy running the show at Shake Shack)

  • I have to agree with Steve and say that little things really do end up making a big influnce. And Red Mango brand is deffinalty remarkable!