Bringing All-American Brands to International Markets
As a franchise reporter for two years now, I’m continually amazed by the amount of research, brainpower, cultural/regulatory awareness and personal time spent traveling to bring U.S.-based brands to overseas markets.
Of course the amount of effort varies depending on what part of the globe you’re talking about. Bringing an Acme Hamburgers to Canada, for example, is nothing compared with bringing said fictional brand to Middle Eastern countries that require dramatic changes to the concept.
At this year’s Restaurant Finance & Development Conference, run by the Restaurant Finance Monitor, Franchise Times' sister publication, at the Bellagio in Las Vegas, three brand experts shared their experiences in bringing distinctly American brands to far-flung countries.
Daniel del Olmo, president-international at DineEquity (Applebee’s and IHOP), said one of his brand’s primary challenges was learning how cultural and real estate differences impacted the brand. Using the example of an Applebee’s in Qatar, one of its older international locations, the franchisee followed the brand’s pre-existing template that included a large bar in the center of the restaurant. Because drinking alcohol is much less common in that region, the brand had to tweak its model to de-emphasize or remove the bar altogether for its future locations.
Ned Lyerly, president-international of CKE Restaurants, used the example of the brand’s risqué advertisements, especially here in its home market. With scantily clad women and innuendo, its advertisements for Hardee’s and Carl’s Jr. needed to be toned down—especially in Middle Eastern countries.
Lyerly added that flexibility in real estate was a big part of the equation, as larger, freestanding locations are harder to come by in many other international markets. Included as part of his presentation, he showed several examples of international units, while going into the details of shrinking the back of the house and dining rooms to adapt the template to a much different environment.
In India, where beef is generally not consumed for religious reasons, CKE’s brands spent two years developing a beef-free menu, while staying true to its char-grilled roots.
Kevin Bazner, CEO of A&W Restaurants, offered similar anecdotes, including de-emphasizing its signature root beer with the letters RB to avoid confusion that it is an alcohol-based product. For a brand that’s had an international presence for 50 years, Bazner said many of the brand’s international customers have the same childhood memories that so many Americans do—your author included.
The overall theme was clear: international growth is a key part of many brands in today’s market, but getting there without making embarrassing or costly mistakes takes significant expertise. Managing the supply chain to ensure it’s profitable is a whole other story, and often requires the work of in-house or contracted experts.