Right About Now - Legendary Business Advice - The Secret Sauce: Chick Fil A's Magical Business Formula with CMO Steve Robinson

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Starting point is 00:00:28 Great brands only grow in great culture, and great culture only happens when leaders define it and cultivate the soil. This is right about now with Ryan Alford, a Radcast Network production. We are the number one business show on the planet with over one million downloads a month. Taking the BS out of business for over six years and over 400 episodes. You ready to start snapping next and cash in checks? Well, it starts right about now. What's up guys? Welcome to Right About Now. I'm Ryan Alford, your host. And you know, we like to say we always try to be right and we're definitely right now. And you know, I grew up. I had this conversation with our current guest just a moment ago. Loving a certain brand, I was being nostalgic thinking of an old mall that is now shuttered here in Greenville, South Carolina, where we're. do our episodes and was reminiscing on playing on the playground within this mall and having a certain food item that you in the U.S.

Starting point is 00:01:38 probably might be a little aware of. I'm really excited to have Steve Robinson. He's the former chief marketing officer and the author of Covert Cals and Chick-fil-A. Steve, what a pleasure to have you. Good to be here, Ryan. Thank you. Yes. You know.

Starting point is 00:01:55 I was in that mall that you talked about being shot. I've been in there. Yeah, I go because I started there in 1981. I know. And I grew up eating the nuggets and the chicken and outside all iconic. And I'm pretty sure still tastes the same. It's the same. Small tweaks, but a little known, in 1985, when I was going to Greenville Mall,

Starting point is 00:02:20 it was a pretty well-kept secret except in the malls. That's right. But thanks to Steve, it became what is one of the most iconic brands in U.S. history. Yeah. It was a great. It was a great trip. Yeah. I know you've done a lot and have enjoyed getting through parts of the book.

Starting point is 00:02:37 Steve got booked. I want to be honest. I have read and listened to excerpts of this book, lots of which. And a lot of them found, you know, fundamental beliefs that I have in brands and things. But Steve has done a number here with this book. I'm excited to talk about it. You know, it's so funny. about when people go left, you need to go right in marketing sometimes.

Starting point is 00:02:58 And sometimes it's just doing the right thing. Yeah. Yeah. And when I think about Chick-fil-A and what you've done, there's like, there's this moral thread through it. Yeah. And then there's just the right way to get things done. And I think if I was simplifying, you know, the take, I was like, if we really

Starting point is 00:03:14 simplified this, this is how business should be done. It is. Well, I went, I went to work for them in 1981. Prior to that, I was the director of marketing for Six Flags over Georgia, which back then was a hot brand, well-run business. It had a great... It was real nostalgic, Steve. I'm thinking Six Flags and Chick-Flag growing up.

Starting point is 00:03:35 These have good vibes here. Well, I actually met them trying to convince them to build a restaurant inside the park as a way to build their brand and trial, because back then they were only in malls and mostly just southeastern states. So the footprint of Six Flags kind of matched theirs. But I joined them in 81 because... their founder and their C-O, Jimmy Collins, the founder was true at Kathy. They both came to me and said, look, we don't have a marketing department.

Starting point is 00:04:04 And your name keeps coming up in our search because we need one. Would you have an interest in talking to us? And Ryan, when Jimmy called me with that question, in the back of my mind, I started laughing. And I said, well, I know you don't have a marketing department. Or you would have done that deal with me two years earlier to put a restaurant in the park. Yes. But I already knew a lot about them because of that experience. And six flags had gone through a transition where they'd been bought by Penn Central

Starting point is 00:04:33 and out of that bankruptcy that you may remember. They became part of PINCO. And suddenly this very brand guest-focused company was starting, in my opinion, kind of drift a little bit of short-term transactional focus. And so when I get that call from Jimmy, I said, you know, I'd love to talk to you. I figured I interviewed with Six Flags for a full day and had the job offer at the end of the day. What the heck?

Starting point is 00:05:04 Three or four days, maybe. If nothing else, I'll learn more about Six Flags and Jimmy and Truett, Kathy. Well, five and a half months later, I was still interviewing with him because that phone call came on August of 80. And they eventually invited me to join them. And I think an important point, an important story that's part of that. It really demonstrates the culture underneath Chick-Fillet was I was sitting in Truitt's early December still interviewing. I'm doing it stealth.

Starting point is 00:05:35 I finally looked at him and said, Truit, what are you looking for in the idea of marketing candidate? Because this is starting to get a little cumbersome. Yeah. And he paused and he looked at me. He says, I have absolutely no idea. All I know is whatever it is, I don't want to do it. Okay. That caught me a little off guard.

Starting point is 00:05:53 Yeah, I would not have expected that. But then he paused. He said, but you need to understand the most important decision we make here is who we invite join the organization. And we're only going to ask you to join us if we think we can have fun together, that we can trust you. And I'm trusting Jimmy and others to figure out if you can do the job. Now, think about that answer. Most people, most organizations, it's all about competency. But he was telling me in a very quick answer, I'm more concerned about who you are. Yeah.

Starting point is 00:06:29 Now, what I didn't know is their attitude was, if I come there, he's never going to leave. So we better be good with this decision. Now, you may say, well, that just because they were interviewing you to be a director of marketing. The reality is they approached every selection that way, staff and Chick-Fleigh operator. The attitude being, if we invite this person to join us, we don't expect them to leave. And so we better make a good choice. We better do our homework. And so I get a lot of questions about why do people have such great people interactions in Chick-fil-A restaurants?

Starting point is 00:07:09 It really goes back to that, that fundamental experience I had in that last interview with Truit. You pick the right people. They're going to attract more of the kind. that you want in the business. And the Chick-fil-A operator deal, which we can talk about a little bit, is very unique. And if they pick the right operator for that restaurant,

Starting point is 00:07:31 in turn, those operators pick the right talent for the restaurant. And guests, therefore, have a better experience. So I learned a lot about the culture just in the process of that patient five and a half months of interviewing. And I never thought when I joined them it would be a 35-year career, but it turned out pretty good. good. Yeah, it did. Talked with Steve Robinson, former chief marketing host or Chick-fil-A.

Starting point is 00:07:56 Steve, I think a lot of people hear the culture word now and today and they like to, ah, yeah, it matters. Yeah. It matters. But I think you got to delete the butt. You do name it. It just matters, right? That's exactly right. It's like, especially, it matters probably in any, any business, but certain. the behemoth that Chick-fil-A was going to become or had the potential. I mean, your headroom might be in any business. It's okay, headroom, I think of opportunity, right? Right.

Starting point is 00:08:35 Where Chick-fil-A has gone and where you helped take it to, just the headroom would have never been there without that culture. That's correct. I talk about it in the book, Ryan. it wasn't until I was near the end of my career that I really began to put words to what I had experienced around the culture. And here's the sentence I have in there. Great brands only grow in great culture and great culture only happens when leaders define it and cultivate the soil. And so it's in that well-defined and well-cultivated soil, the great brands grow and thrive.

Starting point is 00:09:14 And that's what Trude Cathy and Jimmy Collins focused on. They're still focused on it. And so when people say, well, what's in culture? I think you can be very clear about culture. For us, we defined basically four key components. One was a very clear purpose. And in a night, why does the business exist? What do you mean by purpose?

Starting point is 00:09:36 Why do you exist? Why does a business exist? And as an individual involved in the business, why do I exist in this business? So for Chick-Fillane, 1982, we had a major financial crisis. Their culture reflected the values of Trude Kathy, but nothing had ever been put in writing. And we went off as a leadership team for three days. And even though we had major financial issues,

Starting point is 00:10:01 it was interesting. Well, within a day of the three-day meeting, we shifted finances and marketing into, okay, let's get clear about why we exist because people need to understand how we're looking at this crisis. What are the filters? I won't bore you with the next two and a half days of what we did, but we worked on nothing but defining why Chick-fil-A exist,

Starting point is 00:10:23 and we came out with one sentence, to glorify God by being a faithful steward of all that is entrusted to us and have a positive influence on all that come in contact with Chick-fil-A. Now, when you dissect that sentence, which took two-and-a-half days to write, which, quite frankly, in my opinion, was a miracle. there's basically three big ideas. Truit wanted a business that would glorify God,

Starting point is 00:10:49 not because it was a platform to preach, but by the very experience of interacting with the brand, have a positive influence on people who came in contact the business, whether they're within the business or as an outsider interacting with the business. But for him, it all hinged on great stewardship. He saw the business as a gift. Right up there, right behind his salvation experience,

Starting point is 00:11:15 with Christ, he saw that silly little sandwich and what it was becoming as the center of a brand as a gift, and he wanted to steer it well. And his philosophy in that meeting was very clear. If we steward it well, we'll likely survive. If we don't steward it well, we won't. So number one element of a culture is clear clarity around why you exist. Number two, what are the fundamental values that you're going to use to make decisions. For us, you can call them values, but I call them non-negotiables. One of the things you're going to fall on a sword over that gives clarity for leaders to make more decisions on their own rather than running up to their boss.

Starting point is 00:12:02 So we came out with six, very clear values, stewardship, we're going to have fun, integrity, honesty, which we distinguished, excellence, and what was the sixth one, great talent, known for great talent. So first principle in culture is why you exist. Secondly, what are the things you're going to fall on or sword over? Suddenly, when you look at honoring God's stewardship and influence, and those six non-negotiables, it starts to become easier to decide how you're going to invest time and money, you see?

Starting point is 00:12:49 Third big element was, what does the brand stand for? So we literally design that around the question, what is our brand promise? Use a lot of customer research over decades. That one can evolve. When I left, the brand promise was where good meets gracious. The Chick-Fillet experience is a lot more than just food. It's the interaction with every guest, personal, eye contact, unexpected, graciousness. And oh, yeah, everything is good.

Starting point is 00:13:25 Food, environment, et cetera. And then the final piece of your culture is, in fact, your strategies. What are you going to do to fulfill those first three? So I think going back to your question, I think a lot of times culture, yeah, that's important, but it's because leadership has not made the effort to define what their culture is. There should be no question about what an organization's culture is. But when you have, as you and I were discussing before we went on the air, if you have constant turnover in leadership, CEO, C-O, C-O, C-M-O, very difficult to, number one, define those key components of culture and then live about long term. Because turnover comes, well, I want to put my fingerprint on the business.

Starting point is 00:14:22 And I want the culture to reflect me. The beauty of working for Chick-fil-A was it was privately owned. It's still privately owned. That corporate purpose statement has not changed, not one word of it. those six priority non-negotiables have not changed. And what that in turn drives is the ability to empower a very large organization to make more and more decisions closer to the guests, closer to the customer,

Starting point is 00:14:52 and not having to constantly go vertical with decision making. Because everybody understands, okay, I'm about to make a major decision for the business. In some form, it doesn't matter what's food, marketing strategy or technology, whatever, is it going to complement those values and that purpose, that brand promise or not? And in fact, my last three years there, the entire business plan, strategic plan, was built around where good meets gracious. Every major initiative in the business was evaluated on whether it would help fulfill that promise.

Starting point is 00:15:34 So that's how you create, you know, across three, four, five thousand restaurants, and there between three and four thousand now. That's how you create continuity of the brand experience and the cultural experience, the people experience. A lot to unpack there, Steve. I do want to. That's why I wrote the book. Well, I want to just say, number one, the full playbook for how.

Starting point is 00:16:03 to create a magical brand is in covert cowher cowl. But what Steve just did might be the most impactful six minutes of like how to build a company the right way from the bottom to the top. And we're going to make that a YouTube alone clip right there, Steve. Literally, because I'm just telling you that is magic and just hearing you talk and knowing. But you know what I was doing two things? I understand it took me 35 years to see that. evolve. I know, but that's why you're yours, Steve, because you have that knowledge and others don't. But what, you know, I want to make a couple points. Number one, as you were talking, I was thinking about the Chick-fil-A experience.

Starting point is 00:16:47 And short of maybe like one out of about a thousand visits I've ever made to Chick-fil-A, so 99.9% of the time, maybe the cashier was having a bad day. And even then, I pretty much got that. I was a thinking every experience ladders back up to what you just described. We're good meets gracious. We're good meets gracious. Right. Every, every experience. Yeah.

Starting point is 00:17:12 And so that's the proof in the pudding right there. Well, the underlying message in terms of corporate communications and training all the way to every team member is what does that mean? It means everything about the brain should be good. Ingredients, food, environment, service. cleanliness. Where good meets, I meet you, I connect with you. We actually show dignity and respect by saying, hello, we're glad you're here. You say thank you. We see my pleasure. Okay. We're good meets gracious. You actually experience grace. You experience hospitality. You experience what the word restaurant actually means.

Starting point is 00:18:03 It means a place of rest. And the first word means where, wherever you interact with the brand. Not only in the restaurant, but in the drive-thru or at an event or even in your interaction with the Chick-fil-A app and the options you have to choose at best serve you. you get to choose where you want to interact with Chick-Fle-A, but wherever that is, that's the experience we want you to have. You're met, it's good, and it has a flavor of gracious hospitality. Yes, and it does. That's why everybody says, you know, no way it does it like Chick-Fleigh.

Starting point is 00:18:47 So what does that mean? Why did we pursue that? Because my first 10 or 15 years of Chick-Flea was all focused on the, the food experience. Yeah. And we got pretty good at that. I mean, we even applied principles from companies like Lexus, Zero Defect, really perfect a consistent food restaurant experience.

Starting point is 00:19:12 Part of the transition of the brand was, okay, how do we go beyond being maybe the best of a bad lot, the fast food category, and become something that no one else in the fast food category can be. And a lot of that was driven by Truitt Kathy when he had an experience that Ritz Carlton around the whole issue of My Pleasure, and he brought it back to us. And he just kept pressuring us and pressure

Starting point is 00:19:41 and pressures. How do we instill a My Pleasure experience into the restaurants? At the time, we had about 50,000 team members. They now have over 200,000. That's a big, challenge and it meant we had to institutionalize hospitality just like we had institutionalized the menu experience and that that that challenge was harder than the menu yeah I'm sure yeah because you I unpack how we did it in the book and hospitality it's an interesting word yeah

Starting point is 00:20:19 because if you're listening right now you're like me going hospitality and fast food I don't see more. It does. Yeah. But if anyone has gotten there, it's Chick-fil-A, you know, because you do feel like, and you know what? I'll be darned, Steve. I feel like those cash registers mean it when they say with pleasure.

Starting point is 00:20:40 They do, man. I know. And it's like, because sometimes I'm cynical by nature. It's probably what makes me a good marketer and like all that. But like it's curiosity and like, you know. But I'll be darn, man. I mean, I'll be the fast. I'm like, she's probably had a rough day, and she just said, that's my pleasure, and I think she meant it.

Starting point is 00:20:58 Right. I'm like, how did she mean that? Yeah. And I think she meant it. Part of what we discovered, and we visited a lot of other brand, retail brand experiences that consistently delivered great service and great hospitality, including high-end restaurants like Danny Meyer restaurants in New York, Ritzcarl and hotels, etc. But part of what we discovered is if you want to do. to deliver hospitality, you need to bring people into the business that actually have that gift. I mean, that's actually a gift that's identified in the Bible among the gifts of the spirit.

Starting point is 00:21:38 And when you bring in someone that has natural bent of hospitality, what happens? They attract more people just like them. And even if the restaurant operator doesn't have that gift, they can still attract leaders and team members that do. Yeah. And it becomes contagious. And that's what Trude initially experiencing the Ritz Carlin was the contagious effect of saying, my pleasure in every interaction with their guests. That's what he wanted in our business.

Starting point is 00:22:07 Took us seven years to figure out how to institutionalize it, design it, train it, and then measure it. I mean, we're going to have two pickles in every sandwich. We measure that. How do you measure my pleasure? How do you measure refreshing every drink? How do you measure carrying out large orders to the car without being asked, et cetera, et cetera. We had to figure all that out. This show is sponsored by BetterHelp.

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Starting point is 00:24:01 Visit BetterHelp.com slash right about now. You'll get 10% off your first month. That's BetterHelphelp.com slash right about now. Talking with Steve Robinson, former chief marketing officer, Chick-fil-A. Steve, you said something earlier that I want to go down a road, transactional versus building brand. Yeah. And in today's world, you know, performance marketing has become, you know,

Starting point is 00:24:33 the term of the century. It's really like the last 10 years. Yes. Especially with digital and everything else. And you know this. I don't have to tell you this. I mean, you are a rare breed being at a company for as long as you are, especially as a CMO.

Starting point is 00:24:48 Yes. knowing the short leash that all employees and leadership seem to get. And the demand for sales today right now, damn it. What's your perspective? Like, how do you build brand today? And why have we gotten so short, I call it short termism? Yeah. It's a disease.

Starting point is 00:25:12 No question. Next 90 days. Yeah. What I joined Chick-fil-A, they were actually. operating in that paradigm. They thought fast food. We are fast food, so we must have to market like fast food. And they were doing that.

Starting point is 00:25:29 They were doing coupons and discounts and price features. And ironically, they were only in malls where the mall was a building medium, in a sense. Yeah. Didn't really need. They didn't really need to be doing it, but they were doing it. And I grabbed it. I kind of tripped right into it too when I got there. And as I think I mentioned,

Starting point is 00:25:54 I was actually involved in a promotion in 1982 that was focused on deals. It absolutely blew up. It was too successful. Financially, it hurt us. And that actually became a catalyst for me and my team. And my team then was maybe six of us. Just sit down and say, this is we got to we don't need to market chipfully like this this is crazy we got to figure out another

Starting point is 00:26:19 way we work for a guy has no intentions of selling the business why are we chasing short-term transactions with deals yeah and operators were hooked on it like drugs you know they're running coupons and stuff like that so all that to say that's what i started in a crisis made us step back and and say, we don't want to be like that. So what I unpack in that book is a 30-plus year journey of being a brand focused on the experience, the value, building an emotional relationship with the customer. Even that's what drove the development of the cow campaign,

Starting point is 00:27:02 was the emotional connections. How do we do, how do we focus on emotional connections in every interaction, the food, the spirit, the service, the drive-through, the advertising, events. And we're well into that journey. My last 10 years, a book comes out called Blue Ocean Strategy. I read that book. This sounds like what we're trying, this is what we're trying to do.

Starting point is 00:27:31 And it actually added some really good third-party credibility to take to not only staff, but all the operators to say, look, this is, this is, this is, this is, this is, this is, not only will work, it is working, we need to put the pedal to the middle. And that added catalyst to developing the second mile service strategy that really took the brand to another level. It added credibility to why we use cows instead of showing food and price because we were building emotional engagement that people liked and remembered and people don't remember pictures and price points. So that's a bit of a long answer, but it all was possible because we had private ownership that was focused on the long term.

Starting point is 00:28:21 Stuart Kathy was not focused on how much money am I going to make. He was focused on having a healthy business, a healthy balance sheet, a long-term, healthy brand that he could pass on to the next generation of not only his family, but Chick-fil-A operators. And when I joined Chick-fil-A, I think average store volume was probably around $400,000 to $500,000 in a mall. The last year, the average store volume for Chick-fil-A was $9 million. And we can talk about it, but one of the major catalysts in the other reason we were able to do that is because of the operator model. You want to answer? You want me to unpack that now? I want you to unpack that because I want you to answer this, Steve.

Starting point is 00:29:09 is touch heat up. Why the heck hasn't any... Everyone knows Chick-fil-A is the king, the icon, amongst a lot of... I don't even want to call them B players. Deep. Not fast food.

Starting point is 00:29:25 Yeah, other category of brands. And other category brands. And you give away the playbook. We share. You share. I don't know. Like, you don't give away your best people, but you give away the playbook. It's in the book. book is right here. But Burger King

Starting point is 00:29:41 hadn't done it. McDonald's hasn't done it. Hardee's. I mean, the list goes on and on. The why why, you know. Okay. Well, one, I've just touched on the first. You have long-term focused ownership. Well, that's a big hurdle right there. It is.

Starting point is 00:29:57 That's a big starting point. And we already touched it a little bit. Number two, you have a culture that is focused on more than just profits. And I've already unpacked some of that. It is, but yet it's the most profitable one. I just have to call it these ironies for you. If you're not paying attention, the punchline in all of this is they're not chasing it, but they're delivering it. But it comes. And it really reflects, which I talk about in the book,

Starting point is 00:30:27 Truitt's favorite Bible verse, which is Proverbs 22.1, a great name is to be more value than silver and gold. Okay, so principle being, you take care of your name, you take care of your, reputation, and in his case, one that glorifies God. And in faith, you're trusting God that he'll provide, okay, well, that's obviously happened. So long-term ownership, an environment where culture is clear, people are empowered, they can make decisions, they know the box top of what decisions are appropriate, okay? but then you've got to have an organizational structure that empowers that as Colin said makes that flywheel those first that flywheel work for for Chick-fil-A is the operator model it's the leadership model of every restaurant chick here's here's the top line chick-fil-a owns every restaurant they find the site they build the restaurant doesn't matter what kind of location it is they equip it they even put the first inventory in the restaurant

Starting point is 00:31:34 they go out and find, recruit, and train an independent contractor. They call them an operator. They're protected by franchise laws, but they're not equity investors. They put up $10,000 earnest money for the deal. But their commitment is they must actually run that business. They're not a passive investor, like many franchise operators are. their income from the restaurant is based upon half net pre-tax operating profits. They pay Chick-fil-A percentage off the top for the use of the brand and all the brand services.

Starting point is 00:32:20 I won't get into all. But they have to pay for all the expenses, including the team members, the talent, the team members work for the operator, not for Chick-fil-A ink. Part of their rent goes against, comes back. to Chick-fil-A, offset the investment Chick-fil-A is made in that site. And there's usually a cap to how high that rent can go. So they're paying a percentage off the top. They're paying rent.

Starting point is 00:32:50 After all their expenses, pre-tax profits are split 50-50. So for a Chick-fil-A operator, every incremental customer, every incremental sales dollar, every incremental therefore net pre-tax dollar, Half of its mind. So what happens? You have a leader in every restaurant at Chick-fil-A that's highly bested in the success of that individual location. And as a result, they attract better people.

Starting point is 00:33:22 They train them. They keep them longer. They empower them. I mean, the average Chick-fil-A operator now is probably got seven to ten full-time salary leaders in their business. and they're focused on growing a healthy, profitable, managed the P&L, bottom line. And our job at the home office was to do what the operator could not do for themselves.

Starting point is 00:33:52 But what is that? Create and manage the brand, everything that makes up the brand, every guest interaction with the brand. Generating demand. Creating demand, creating value through the brand. And then obviously building the infrastructure, the stores, supply chain, accounting services, IT support, building infrastructure to support them. Jimmy Collins, who was a former CEO, used to tell staff, home office staff all the time, if you're not supporting somebody who's selling chicken, supporting the Chick-fil-A brand, then you're not doing your job. We don't sell any, we don't have any cash registers at the home office.

Starting point is 00:34:33 And it's very true. But that again, that's that cultural focus of the most important people in the business starts with a customer. And the second group is the Chick-Fleigh operator family. The next group is the staff. The last group is the owners. Many organizations have that the other way. They're all about ownership, return on investment. return on my real estate investment, building my real estate portfolio.

Starting point is 00:35:08 None of that, none of that was important to Trude. He knew it was important, but that wasn't true, Kathy's priority. His priority was the guest experience. How am I going to give a great guest experience? I'm going to recreate myself in every restaurant. We call them Chick-fil-A operators. I'm going to have them highly incentivized to make decisions,

Starting point is 00:35:27 take care of the customer every day all the time. and then I'm going to build staff to support them. And as a result, my family and I will probably be okay. Well, they're doing quite fine. They're doing quite well. We got probably one of the most valuable brands in the world. Yeah, but the priority that I described, and I talk about in the book, the priority I just described is inverted in many organizations.

Starting point is 00:35:55 Yes, it is. They're focused on owners. They're focused on operational priorities. conveniences, systems. Customers might be the third audience, the constituent that they really pay attention to, but they're making decisions in a completely different priority of how Chick-Fle was organized. And it's basically built around those three big buckets, long-term ownership, clear culture, and leadership's focused on managing it, and an operating model that creates, that makes that whole system run

Starting point is 00:36:33 and that operating model is operator, shipfully operator focused. Are these other entities just too intertwine now to go that direction? Could they do it? I think the right organization could do it. If you had a board of trustees, even if they're public,

Starting point is 00:36:51 if you had a board of trustees that were willing to empower leadership to take a long term, we want a long-term healthy brand. Yeah. We're going to pull back a little bit on this being counter focus on every 90 days, what's happening, and this performance oriented marketing is nothing more than code

Starting point is 00:37:09 for a financial priority versus a customer priority. It is. Exactly right. And I think it's one of the most unhealthy things that have crept into the business acumen in America. Yeah. But you've got to have a board that's willing to empower, whether it's a private board or public board,

Starting point is 00:37:31 that's willing to power leadership, take a long-term focus. We're going to focus on the customer. We're going to focus on a long-term healthy brand that people fall in love with. I don't care if it's fast food or car or shoes. The principles are the same. So it can be done, but it's got to start. It literally, it sounds like a cliche, but it has to start at the top. Now, specific to Chick-fil-A, I think the reason you haven't seen many people in our category

Starting point is 00:37:57 or other retail categories pursue it is too basically. reasons. It's incredibly generous. The average Chick-fil-A operator now is making pushing $700,000 a year. You think of McDonald's store manager's making that kind of money? No. Now, you've got some franchise owner who's got multiple stores and a real estate portfolio who's probably doing okay, but he's not focused on the, he's not focused on the restaurant experience. No. The Chick-fil-A operator is. Yeah. So number one is that they would have completely restructured their operational priority to the leader in the restaurant.

Starting point is 00:38:45 And one of the hangups there is, well, the Chick-Fleigh model is too generous. But the other part is, which I've already described, is the Chick-Flea model, I think, is pretty ingenious. The operator model has never changed. It hasn't changed one iota. And the reason it haven't changed is Truitt and Jimmy wanted the operators to be able to trust Chick-fil-A that they're not going to change the deal. You know, how many sales organizations, salespeople start making too much money, and they fangle up, they reconfigure the commission structure.

Starting point is 00:39:23 Yeah. Chick-Flea operator deals never change. Half net profit. Bing, that's it. So when I've heard it costs a million to, or two million to own a friend, a Chick-fil-A, is that even I care? No, no, I mean, the Chick-fil-A operator, their cash investment is $10,000. Yeah. How are you getting in line for that?

Starting point is 00:39:43 Yeah, it's a long line. They have about 10,000 applicants a year. Wow. And they're selected anywhere from 150 to 200 operators a year. So it's a long line and it's a long wait. And they're more focused on the same things that when they interviewed me, they're more focused. on the character of that person, their ability to attract and keep great talent, their ability to really run a large enterprise.

Starting point is 00:40:07 I mean, the average Chick-fil-A restaurant is employed about 120 to 150 team members now. And the ability of someone who can do the hard work of running that kind of business, 24-6, 24 hours, six days a week. Yeah. And it's hard. It's hard work. to run a Chick-Fillet restaurant. You know, speaking of the six, I mean, you know, I mean, I know.

Starting point is 00:40:38 I grew up in the South, Southern Baptist raised. I know, you know, day of rest. Yeah. But as a business, I mean, how much blowback and discussion has there been about, I mean, not because it's internally. Chick-Flea doesn't care. None internal. They could care less, right?

Starting point is 00:40:52 I mean, the proofs of the pudding and it's a moral thing, but. But people talk about it. it because it's unique to the brand. Yeah. What's your perspective? Well, there's several pieces to it. We could sit there and make jokes about it, but I'll tell you the factual side of it.

Starting point is 00:41:10 True, it opened his first restaurant in 1946. It was a little diner in the south side of Atlanta called the Dwarf Grill. And it's because it was small. I mean, he had four booths and I think 10 stools. So he called it. Happily named. Yeah. He and his brother opened it.

Starting point is 00:41:29 They thought they were going to be open 24-7. Yeah. First week they get to Saturday night. It's late. They literally said, you know what? We're not going to open tomorrow. We're not going to. And Truitt was highly motivated by Truitt.

Starting point is 00:41:45 He said, I'm not going to ask people to do what I'm not willing to do. I do not want to work on Sunday. I want to be a rest. I want to be able to go to church with my family, but I don't want to be out of the restaurant. So he made the, decision, they made the decision in that first little diner, we're not going to open on Sunday. And his attitude was, if I can't be successful in six days, I'm in the wrong business,

Starting point is 00:42:09 so I'm not going to open on Sunday no matter what happens to Chick-fil-A. Any blowback is primarily from the outside, you know, retail developers, strip center developers. That want the traffic. They want the traffic. They want the business on Sunday. and in the early years of the brand, it was a real challenge because some mall developers simply said, no, you're going to open on Sunday.

Starting point is 00:42:33 We're not going to come in. And Chick-Flavis said, okay, we're not going to come. But then as they built, they got stores open, they built a track record. Their average sales per square foot beat everybody else in the mall. And the word got around pretty quick. They're going to pay you, they're not only going to pay their rent, they're going to pay your rent overage.

Starting point is 00:42:54 And so six day a week, it's just fine. Yeah. I mean, now we have stores on university campuses, airports, stadiums, and they're all closed on Sunday. That's part of the deal. That's who Chick-Flea is. Yeah.

Starting point is 00:43:07 And I think Trout would joke. He would say, I don't want it. I don't want customers to think that we don't love them. We do love them. But I actually want competitors to be able to have one day when we're not competing with them. Oh, man. You know, the competition is good.

Starting point is 00:43:31 They probably appreciate it. The competition is good. It also helps keep us sharp. But we want the competition. We want them to survive too. That's the greatest jab he could do. But, you know, he would also observe, and he's right, that it helps operators select and keep good people

Starting point is 00:43:51 because everybody knows they got a day off. Yeah. You're not going to be asked to come in on Sunday. You think that ever changed? No, as long as the business retains, stays in the Kathy family. It won't change. No, well, that changed. I mean, what's the business worth? I don't have any idea. How many billions? I'm sure. Yeah. But, um. But is there a lineage that where you never, they're into the third and fourth generation of family now who are involved in the

Starting point is 00:44:15 business? Some of them running stores. Some of them are on staff. They love the business. It's all they know. It's their platform for ministry. It generates incredible cash that, that they use to support things that they love, ministries they care about. Yeah. They don't want to walk away from that. So, no, I don't see it ever. And if it ever did go public, anybody who bought it would want to open on Sunday, and they'd want to, you know, ramp that operator deal down.

Starting point is 00:44:47 And probably in three or four years, the brand would lose it. Yeah. Be over. because you'd be unwinding some of the things I've already described that really make that thing hum. But I boil it down to two issues. It's too generous and it's ingenious. And part of the being ingenious is that they've not changed anything

Starting point is 00:45:13 that's crucial in the business. And things like Sunday, the operator agreement, the Chick-Fully recipe, the commitment to every restaurant is a restaurant. They're making food in those restaurants. They got big kitchens that actually produce food fresh. I mean, there's fundamental principles that have not changed. I think as long as they stay true to those,

Starting point is 00:45:37 that the brand can just continue to grow. Talking with Steve Robinson, he's the former chief marketing officer, Chick-fil-A, and the author of Covert Cals and Chick-fil-A. Steve, I want to pivot a little bit to, you know, your perspective, marketing, branding at a more global level. And like, you know, we talked pre-episode. You got, you know, you're having this extended tenure for one company.

Starting point is 00:46:02 You saw these things that rise and the change of marketing. Yes. Traditional TV, radio, out of home, social media comes into play. Yes. Obviously that we've been talking very tactical strategy, which is, hey, the most important part. But the tactics, you know, the social media aspect, the digital aspect was sort of just your overall perspective of how it's changed and how many different channels there are and how you can't just run a TV ad anymore. Right. Because not everyone's watching TV.

Starting point is 00:46:42 Right. But just general perspective on the landscape of marketing and media. I have two or three, I would say, principles that during that transition, my team and I adopted. Part of the Blue Ocean strategy is fundamentally being willing to step back and say, okay, every brand interaction, no matter what that touchpoint is, for us, how do we use it, deliver where good meets gracious? Okay. Well, that automatically means we're not focused on using every.

Starting point is 00:47:17 interaction to drive transactions. Right. We want to figure out how to make the brand more meaningful where good meets gracious in that interaction. So how are you going to use not only traditional media? I mean, we started with billboards and TV with the cows to build emotional connections. How do you take the cows into those other platforms? How do you use those platforms to tell stories that reflects where good meets gracious, not what is

Starting point is 00:47:47 the latest product and price point at Chick-fil-A this week. How to use technology to make the guest experience still more convenient while also still being personal. So we were working on the Chick-Fillet app long before I left, and it has continued to evolve. But some of the guiding principles going in is we want the Chick-Fillet app to make the guest experience convenient, but we do not want it to put. pull them away from our people, our team members. We wanted to make it a better experience with our team members.

Starting point is 00:48:25 So, okay, what are we going to do in the drive-through? We're going to get rid of, we got all this technology, we're going to get rid of those little metal speaker boxes. Thank the Lord. Okay? Well, what are you got to put into place? Well, we're going to let them use the app to pre-order. When they show up, we're going to have people standing outside.

Starting point is 00:48:46 How's that? Not a box. Real people. They're going to have in their hands a iPad that's interfacing with registers on the Chick-Fleic computer system in the back through high-powered Wi-Fi. Okay, we're using all this stuff.

Starting point is 00:49:05 And when that customer comes in, if they pre-ordered, we already know who they're... By the way, the app will give us a GPS alert that they've hit the property. So it'll verify they're on the property, their order is ready, and they have the option they can go through the drive-throom, pick it up, or they can go to the curb and we'll bring it to the car. Those are just illustrations.

Starting point is 00:49:31 So when I left Chick-fil-A drive-thru was roughly a third of their business. It's over 60% now, wow, heavily influenced by the app. But every one of those transactions still has a human contact. Yes, it does. So my point is, it doesn't matter what those evolution is with media and technology and digital, you've got to make a decision about what do you want the brand experience to be and how you use those. And we have a high value on the team members and the restaurants. So part of social media, for example, the evolution, we're going to use social media.

Starting point is 00:50:16 principally to tell stories about guest experiences in the restaurants. And we're not going to tell the stories from the home office. We're going to let the operators, the team members, and the customers tell the stories. But we're going to create the platform on Facebook and Twitter and other platforms where it's easy for them to do it. But my preference was that the stories be genuine and from as close to the customer as possible because I didn't want them to come off as narcissistic. Yeah.

Starting point is 00:50:50 And I think when stories start coming out of the home office, that's the risky one. Cow's coming down to the home office is okay. We're just making people laugh. But guest experience stories, I think need to be generated as close to that customer and that store as possible. So that's an example of how we chose to use social media.

Starting point is 00:51:10 But it goes back to, what do you want your brand to be? What do you want the guest experience? to be with the brand and then you translate it into those various platforms. I led the witness a little bit here. So I'm going to just admit something to our audience. I didn't know for sure, but I knew Steve was going to go there. The tactics don't matter. The strategy and the brand and carrying it through wherever you're doing it is what matters.

Starting point is 00:51:36 That's right. And that's where you're at. And there might even be certain platforms out there that don't fit your brand. You've got to make a decision. We're not going to use it. Yeah. We don't want to be there. That's right.

Starting point is 00:51:47 And we're not going to carry on dialogue on platforms that put the brand at risk. Yeah. So, for example, we had a clear policy. We're not going to discuss social and political issues on the platform, whether it's the store level at the corporate level. Yeah. That's an interesting one there, Steve. I want you to go down that road because everyone's gotten into this, okay, we're a purpose-based brand. And look, I mean, you could argue, and a lot of things we talk about this, well, Chick-Fleck-Fleck kind of is, but it is, but it's not.

Starting point is 00:52:21 You know, like, it's purpose. It has clear purpose. We have clarity of purpose. But it's an inward, it's sort of an inward belief and purpose and not this cause or that cause or getting on this soapbox or that soapbox. Chick-flee, remember, I told you the purpose, core values, the brand promise. Yeah. where good meets gracious. That's all about us personally delivering a guest experience that, quite frankly,

Starting point is 00:52:53 the fast food category is unexpected. Okay? Yes. Surprise and delight. It's a blue ocean, clearly a blue ocean strategy. Well, you don't want to say anything that all of a sudden creates some sort of emotional barrier that gets in the way of that promise. because you pick a social or political topic,

Starting point is 00:53:14 it doesn't matter which one you pick. Half of them agree with you and half of them don't. Yeah, especially today. Today. So don't put the brand in that position. And for us, don't put over 2,000 Chick-fil-A operators in that position where they have to start dealing with that instead of focus on the guest experience.

Starting point is 00:53:34 Yeah. Did it become a fine line, though, with faith, and, you know, glory to God. Yeah. Sure. You know, the very clear things that that entails with choices. And Truit was very clear. I don't want to use the business.

Starting point is 00:53:49 I'm not going to put scripture on packaging. And I don't want to use the business to quote evangelize. I want people to notice something unique and difference about Chick-fil-A. If they want to ask us why, we'll answer their question. We'll tell them what we'll see is the purpose of the business. Yeah. We'll tell them what motivated Truitt Kathy to get up every morning. go to work.

Starting point is 00:54:10 Yeah. We don't mind talking about that. Yeah. I mean, he saw the business as a gift. He wanted to steward it well. The most important book he ever read was the Bible, and he tried to live what he understood, you know? There's no problem with that. No.

Starting point is 00:54:24 And, but we try to earn the right to answer somebody's question. Yeah. Not lead with what do we think. Yeah. Good gracious. And now that might change. Yeah. That's the operator.

Starting point is 00:54:41 That's the environment in which I got to operate. Yeah. It's a slippery slope, though, the whole purpose-driven, you know, like, and take a stand. Yeah. Well, you know. I don't go, I don't want to go real deep with you, but when you look at the life of Christ, he never did any of that. He washed people's feet. Yeah.

Starting point is 00:55:07 You know, he healed people. He fed thousands. He always earned the right to be heard under have a relationship with somebody. It's really, it's really a service, a servant attitude. That's rooted in biblical principles at Chick-fil-A, which I happen to agree with, obviously.

Starting point is 00:55:37 It's one of the reasons, One of the many reasons I stayed 35 years. And, you know, God says in Proverbs, my word will not return void. If you apply my word, it will not return void. Now, you may not know how it's going to return. Right. But if you apply my word, I will honor it. And true, I believe that.

Starting point is 00:56:01 I believe that. So when that happens, people kind of scratch your head and say, what's different about this business? Yeah. And if they ask them, you've got a chance to tell them. And I think a lot of the purpose-based take a stand becomes about the person and the company, like saying it, like for the attention of it versus the right reasons, you know, the actual belief that they have sometimes.

Starting point is 00:56:30 Well, understand that, and I think you can see it in everything I've described, you're dealing with a company that is customer-first focused. Yes. I mean, I describe that for you. Customers first, then the operators, then the home office, and then ownership. Well, if you have a customer first focused organization, in a biblical context, we want to serve every customer well. Yeah.

Starting point is 00:56:57 And in a marketing perspective, a brand perspective, and we want to do it so well, we earn brand loyalty. Well, you can't be out here advocating political or social agendas. And do that. No. It really is that simple. Yeah. But if you have leadership of the top that suddenly think, oh, we're going to, we think we can change the world by something we say. I think we've seen many case studies where that's proven to be wrong.

Starting point is 00:57:29 We could sit here and name some of. Yes. As we wind down, Steve, what are you up to today? What I'm up to today? Well, obviously, I still love to talk about the book and the Chick-fil-A story. I do some consulting, but not much. And I don't work, by the way, I don't work with public companies. I find that way too frustrating and challenging.

Starting point is 00:57:54 I work with mostly privately owned companies. Yeah. Husband of Diane. And I'm husband to Diane. I have two grown children. I have four grandchildren. I still do some speaking. But, yeah, right now my life is mostly.

Starting point is 00:58:09 focused on my sweet wife. She and I've been married 52 years next week. Diane's here in the studio. She was in the studio. She stepped out, but he's here with Steve. Man, what a legacy of marriage. And I love that. And we love spending time with our children and their kids.

Starting point is 00:58:26 So, yeah. I'm very thankful. Yeah, Atlanta's home. It was. We just sold our house last year. Okay. And so now we live about half the year in Highlands, North Carolina

Starting point is 00:58:40 and the other half in southwest Florida and kids come see us or we'll get on a plane and go see them. Nice. Highlands is lovely. We love it. Yeah, it's a beautiful place. It's not that far from Atlanta, so we can drop down and visit family. What do you want your legacy

Starting point is 00:58:56 to be, Steve? People ask me that question. And I would I know that makes you think, well, the opposite of what, everything we've discussed. which is like sort of this outward, you know, versus. I actually boil it down to very simple. He loved Christ.

Starting point is 00:59:19 He loved his family. And it showed that simple. That is simple. Yeah. And those are my priorities. If someone was listening, starting a business, young entrepreneur, we've given them. And this book gives them a lot of principles.

Starting point is 00:59:43 What's the one or two things you'd say to them? Well, I think it would be things I've already touched on. Number one, I would be very clear on why you think your business exists. And when I consult, and I have three or four active clients now, that leads to you as the owner need to be very clear on why you exist. What is your personal purpose? and does your personal purpose line up with what you're trying to do with this business? The second question is, does that purpose, in fact, motivate team members,

Starting point is 01:00:19 leaders you're going to attract to want to get up in the morning and come work with you? Are you got to be the kind of leader with a purpose that will create follow ship? The second thing I would tell them is, are you going to be focused on making money? you're going to be focused on serving others. My experience is if you serve others well, money will likely follow. You'll be okay. I just, I think our culture right now is entirely too self-focused

Starting point is 01:00:57 as opposed to others-focused. Chick-fil-A is an other-focused business. I mean, I'm not bragging on them, But it is. And I think what made America strong was more other focus than me focused. So that's what I would, that's what I talk about with young entrepreneurs. You got to assign, am I got to have an others, what's my purpose? Am I going to have an others focus business or is it all about me?

Starting point is 01:01:30 If it's all about me, you probably don't want to work with me as a consultant because that has no appeal to me. You got to run for office, Steve. Oh, my goodness. In this environment, can you imagine that? Oh,

Starting point is 01:01:47 I think it might be refreshing. You know, it might be the Chick-fil-A way to the office. Well, you're very kind. We really appreciate Steve Robinson for coming on and look, go get the book,

Starting point is 01:02:02 Covert Cals and Chick-fil-A, right here. We've got it. He's going to sign it before he leaves. And you're going to see this on all of our show notes, everything that we have. We have links to the book, links to Steve's profiles. And Steve, I really appreciate you coming. Well, Ryan, I was honored you asked. It was great. It was great to drive into Greenville and spend time with you. Yes. Yeah. You know where to find us. Ryan is right.com. We have people like Steve on the show that make us number one. We'll see you next time. We're right about now. This has been right about now with Ryan Alford. Radcast Network production.

Starting point is 01:02:37 Visit Ryanisright.com for full audio and video versions of the show or to inquire about sponsorship opportunities. Thanks for listening.

Right About Now - Legendary Business Advice - The Secret Sauce: Chick Fil A's Magical Business Formula with CMO Steve Robinson

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