Some Getting Real-ish lessons from “The Accidental Empire of Fast Food,” a story about the success of Danny Meyer’s Shake Shack:
1. Have an enemy. In Meyer’s case, the enemy is fast food that strips away the human experience.
“The whole experience is to cram people into a cookie-cutter space, to feed them as many unhealthy calories as possible — then get them to leave,” said Mr. Meyer, the president of the Union Square Hospitality Group and the Yoda of Shake Shack. “That stripping away of human experience? That is where fast food went astray.”
Contrast and compare, then, with the three Shake Shacks in New York City, where patrons are cheerfully welcomed at the counter of a neighborhood-centered, urban-fantasy version of a burger roadhouse. On the menu? Whole-muscle, no-trimmings, fresh-ground, antibiotic-and-hormone-free, source-verified-to-ranch-of-birth, choice-or-higher-grade Black Angus beef.
Furthermore, “people have to wait in line just to place their orders,” Mr. Meyer, 51, said on a recent afternoon. “After that? They have to wait for us to cook their orders. And then? We hope they’ll stay awhile, as they eat. To enhance the communal experience.”
2. Resist growth just for the sake of growth. (Shake Shack is opening more locations now, but slowly and only after years of refusing to expand.)
The Shake Shack rollout is precedent-shattering for the Union Square Hospitality Group. “We’ve always resisted expanding anything, ever,” Mr. Meyer said. “We resisted offers in Las Vegas. We resisted reality TV shows. And it took six years with Shake Shack before we decided to go forth and multiply.”
3. Get real with it, put something out there, and see how people respond.
Mr. Meyer’s accidental empire began with a hot dog cart in 2001, part of an art installation in Madison Square Park. “To our astonishment, every day, a line would form,” Mr. Meyer said. The cart expanded into a burger stand, “and none of us had any idea that that could be a success.”
4. Keep things simple.
Shake Shacks “are profitable,” Mr. Meyer said. “They don’t need a robust economy to work. They have a highly focused menu. They are replicable. There is no reservation operation. There is no florist. And it’s a fun thing.”
5. Focus on quality not quantity.
“Our focus is not on how many you do,” [Meyer partner David] Swinghamer said bluntly. “If we can’t do it right? We won’t do it.”
Mr. Meyer commented that “we will grow as broadly as we can, without losing the quality, the hospitality, the community. And the sense of humor.”
And it’s working. Each of the Manhattan Shacks makes more revenue per location than either McDonald’s or Five Guys Burgers and Fries.
Related:
Choosing the right things to say no to [SvN]
Danny Meyer: Hospitality is king [SvN]
Erik Frick
on 17 Dec 09Good stuff, but I can’t help but point out the twisted logic behind his idea of ‘communal’. Waiting in long lines and then waiting some more isn’t really what comes to mind when I hear the word ‘communal’. I’m not opposed to the idea of communal fast food (it seems to be a growing trend these days actually), but there’s some suspect logic going on here.
DRoss
on 17 Dec 09I work near the ShakeShack in Madison Square Park – it’s verrry good. Worth the wait on a nice day.
Ed Knittel
on 17 Dec 09For those of us who have never been to a Shake Shack, and as a Chicagoan, just replace “Shake Shack” with “Hot Doug’s” and you get the idea. I’ve literally waited in a long, happy line for nearly 3 hours that definitely creates a communal feel. As the uninitiated would say it’s only “hot dogs, sausages and fries”. Add to it that there’s only one location, Doug works the counter, open 10-4 and it’s cash only – your head starts to reel at how well he’s doing.
G.Irish
on 17 Dec 09I think for local eateries one can get away with the long wait thing. A small eatery with excellent food turns into a sort of trendy, exclusive experience where customers are happy to wait a long time to get served. Cupcake bakeries are a good example of this.
But making customers wait in line a long time is not what it’s about. It is a byproduct of an excellent product and limited supply. Artificially increasing the wait times would surely piss customers off. And for some businesses a long wait simply doesn’t work. You wouldn’t wait in line 3 hours to see an automechanic.
I like the story of Shake Shack, it reminds me of the story of Pink’s in LA. But it’s not for every business and it still comes down to the most important factor, an excellent product.
Rob V
on 17 Dec 09Why compare Five Guy’s to McDonalds in the last paragraph, makes me sad, I love that place, didn’t know people thought of it that way, feels very “local” to me, although I’m aware it’s a franchise.
MB
on 17 Dec 09Lame. These are exactly the same principles Snyder’s espoused. You know, the ones who founded In-N-Out.
Nothing new or particularly insightful here. NYC was lacking a burger joint like this and he filled a void. The Madison Sq. Park location happens to be a great setting which contributes to the allure, but would I go out of my way for a Shake Shack burger like I did for In-N-Out in college, nope.
George
on 17 Dec 09Interesting. It seems like the overall concept can be summed up as do things differently. If the fast food chains do it one way, then do the opposite.
Chris Whamond
on 18 Dec 09I believe their “highly focused menu” is one of the secrets of their success. In crowded markets (like NYC), the more you specialize, the more mind share you win…and the better your positioning. When you strip “specialization” down to its essence, it means simplicity. Focus on doing one thing well. Just like doctors, specialists make all the money.
Ten years ago, when I lived in Venice Beach, I had a friend who owned a hot dog stand on the boardwalk. He only offered two food items on the menu: a hot dog or a slice of cheese pizza. And he only offered two drink items: a Coke or a Diet Coke. His annual revenues? $7,000,000 per year.
merle
on 18 Dec 09Ed, I doubt that Hot Doug’s is the best dog in Chicago. There are many fine dogs in Chicago. Check www.greasefreak.com. And waiting 3 hours for a hot dog? I don’t think so.
Ryan
on 18 Dec 09Way to choke on the hype.
It’s a chain, and it’s growing. McDonalds grew “slowly and carefully” at first, too; it opened just nine restaurants in its first 15 years. You don’t think Shake Shack “strips away the human experience?” I guess you didn’t visit the Upper West Side location I dined at, where I ate in a cramped windowless room in the basement, and where the counter staff couldn’t provide a sensical coherent answer to the question “What’s the difference between a ShackBurger and a Cheeseburger?” (Try answering that question yourself on the shake shack website; the menu explains nothing.) Angus is a virtually meaningless label since you qualify for it if EITHER cow parent is Angus. So you just buy angus sperm from people who literally carry it around in briefcases and go farm to farm. This is why McDonalds will sell you an “Angus” burger for a few bucks more. It’s nice they know the ranch and ban hormones but notice Myer doesn’t tell you whether the beef is aged, whether the cows are allowed to graze, or what they eat. Animals die for this food—and personally I’m fine with that BUT only if the person doing the killer BOTHERS to tell me how the animal live. Myers doesn’t do this! Shake Shack is quality over quantity? Are you kidding? Myers is a bright guy with loads of other great restaurants that do that formula. He created shake shack explicity to sell cheaper food to MORE people. Which is fine, but you’ve gotten the lesson totally wrong. These guys sell fries smothered in American cheese and you think they’re not trying to shove low quality food down your throat like McDonalds?This bog has become a noxious hub for completely unchecked corporate propaganda fertilizer.
Ryan
on 18 Dec 09Way to eat my linebreaks and asterisk bullets. Quality software, here.
Donny V
on 18 Dec 09Sorry repost…
Don’t know if you guys have seen this yet. But it looks like Google is moving in on your territory.
Google Groups for Businesses
Ed Knittel
on 18 Dec 09@merle You must not be from Chicago. Have you seen the specials at Hot Doug’s this week? http://hotdougs.com/specials.htm
Spicy Wild Boar Sausage with Chili-Garlic Mustard and Aged Manchego Cheese
Tequila and Black Bean Chicken Sausage with Jalapeno Mayonnaise, Pinto Beans and Habanero-Jack Cheese
Ribeye Steak Sausage with Chimichurri, Crispy Fried Onions and Oregon Smoked Blue Cheese
etc. etc…
Plus waiting 3 hours wasn’t that bad. Sure it was hot out but the people next to us in line went and bought a 36 pack of PBR and were sharing with the folks in line. The people in front of us were from Ohio visiting for Chicago for a couple of days and they had to hit up Doug’s
merle
on 19 Dec 09@Ed I am from Chicago. But now I understand, you were having a little party on a summers day! That’s different than waiting in line.
Aaron
on 20 Dec 09Three words: fad
andrew
on 21 Dec 09I’d argue that #3 and #5 seem to cover it entirely, along with the exclusivity angle.
They make good burgers at a decent price, and are situated in an extremely desirable location. That’s it. No profound statements are being made, and the non-food portion of the Shake Shack’s business actually leaves quite a bit to be desired.
Danny Meyer’s quote about waiting in line almost reeks of arrogance. Although I won’t argue against fresh-made food, I also wouldn’t argue that customers enjoy waiting (particularly when the Shake Shack has essentially one product, and the lines extend around the block)
The crummy ambiance and customer service of the Shake Shack could, of course, boil down to American sensibilities and tastes (much of the same could be said about Five Guys). McDonalds locations in Western Europe are fantastic in terms of the ambiance, decor, and quality of food, compared to their American counterparts.
This discussion is closed.