Who's got my cheeseburger?!

If all premium burgers are essentially high quality and the chips pretty much on par except for minor seasoning differences it’s hard to find territory to fight over. Except brand.
By
Julian Dailly

November 3, 2017

Back in the day, around 2010, the premium burger market - created by people who really cared about “real” burgers - started to take shape. It was a neat reframing of an old idea: cheap junk food magicked into a practical, affordable, small luxury.

Fast forward seven years and this week we hear about tough times at GBK. Like for like growth has gone into reverse and operations are running at a loss. This loss is bad enough to send parent company Famous Brands’ overall profitability down by 59%. What’s happened?


What’s the magic sauce?

Lots of new brands have entered the UK premium burger market, but in real terms none really offering anything genuinely new beyond, well, more burgers.

So people rightly ask: “What’s the new angle on what will inevitably involve me putting both hands to my face holding a meat sandwich, reaching left for my chips and right for my themed drink?”

If all premium burgers are essentially high quality and the chips pretty much on par except for minor seasoning differences it’s hard to find territory to fight over. Except brand.

Brand experience is the one area where there is room for real winners and losers. How new is the brand? How clear is the brand proposition? Or conversely how tired is the brand? Is it fit enough to compete in one of the toughest sectors in the world of eating out? The premium burger world is like Tough Mudder – you have to give it everything, no compromises, or otherwise go home.

Take Five Guys who stormed into the UK in 2013 like a raging bull – nearly 30 years after launching in the US. Their proposition, wrapped around a folksy American story, is succinct: “There are over 250000 possible ways to order a burger at Five Guys. We use only fresh roll stamped prime beef. Nothing is ever frozen. We use only Peanut oil.”

Some brands are struggling to be fit enough to compete.

How does it stack up in the data?

Our proprietary BrandVue data shows the following information about the burger brands in the UK market...

McDonald’s is a real market leader, with highest consideration future visit (67%) and highest annual frequency - the average customer visits about every month and half, or 8.5 times a year.

However, with the highest Net Promotor Score (37.2), Five Guys is the most recommended – despite over half of customers paying more than they expected (bill shock).

With a high score of 83 consumers love the service received at Byron. And when it comes to vouchers just over one in six, use a voucher or discount at Gourmet Burger Kitchen.

Beware newness

With so many new entrants to the category in the last few years newness plays an important role but it may be a short-term dimension, and so an easy pitfall.

The main problem with newness when it starts to drive a category is it can reduce overall return on capital for all investors. Unless tackled imaginatively the need for perceived newness forces all brands to put more money in, just to stand still.

The trick is perhaps to spend less time dreaming up new, imaginative solutions and more time really distilling the proposition into its clearest form possible. Rather than adding more layers, strip it back to its simplest, and so make it more memorable. The classic cheeseburger always wins.

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BrandVue is our daily intelligence and customer performance tracker designed to give our clients a richer view of their business and service.

Brands tracked in Morar HPI BrandVue Eating Out include Burger King, Byron, Five Guys, GBK, Handmade Burger Co, Honest Burgers, McDonald’s, Shake Shack, Smashburger and Wimpy.

Through research data and consulting, Morar HPI helps clients compete for consumers. Together you can gain an advantage.

Morar HPI run BrandVue Eating Out, a daily tracking service for the UK casual dining sector. We survey over 100k consumers each year about their recent dining impressions and experiences across 140+ casual dining brands. Morar HPI is the benchmark insight service for the UK casual dining sector.

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