Freshii makes dinner plans

From the C-Suite newsletter: The pandemic made 5 p.m. "the new lunch hour," so the QSR spun its marketing strategy to hit the dinner crowd.


This story appeared in Strategy C-Suite, a weekly email briefing on how Canada’s brand leaders are responding to market challenges and acting on new opportunities. Sign-up for the newsletter here to receive the latest stories directly to your inbox every Tuesday.

For close to four months, marketers have faced unprecedented challenges – from restrictions to the outright closure of their businesses and even sudden shifts in consumer behaviour.

Toronto-based Freshii has faced those same hurdles. In its Q1 filing, it reported US$2.5 million in losses, as revenue fell 11%. Same-store sales were down 77% during the last two weeks of March – a pandemic low-point of the quarter – and come mid-April, roughly 50% of its restaurants were temporarily closed globally.

But the company is ready to begin the long process of recovery. Included its most recent financial report are details on its plans to realign around new consumer behaviours and needs, which includes testing a new dinner-focused offering called Plates in Vancouver.

The Plates menu consists of five entrees inspired by international cuisines, including Moroccan Tahini, Mexican Chimichurri and Sesamii Teriyaki. Freshii is promoting the dinner menu across the Greater Vancouver Area through targeted digital and radio ads, as well as roadside signage and in-store POS. It has secured media for eight weeks, and will look at extending the campaign depending on early results, says Veronica Castillo, VP of marketing for the brand.

Castillo, who was hired in March after seven years leading marketing at Taco Bell, says the market test is designed to capitalize on a potential “new normal” and may eventually be rolled out nationally. The company sees long-term potential in the dinner occasion, she says, as evening meal purchases have increased as a percentage of its overall sales over the course of the pandemic.

“Industry data has shown that customers are willing to spend more as they dine in and with other family members – for the most part – during the dinner hours, which is why the expansion into dinner with Plates made sense for our business,” she says.

Whether customers were previously working in urban centres or driving to suburban locations to pick up Freshii for lunch, the fact that they’re now working from home – and generally spending more time at home – has been a big factor in this consumer behavioural shift. “More and more customers are looking for other healthy and safe meal options aside from home cooking,” Castillo says. “I believe 5pm is the new lunch hour.”

Freshii-WhatsForDinnerAs part of its recovery, Freshii is also prioritizing digital and delivery. It recently struck North American partnerships with DoorDash and UberEats, and it’s aiming to speed up the revamp of its Freshii mobile app. The company announced it would develop a new app last summer after its chief executive admitted that its existing one did not meet expectations and needed to be “more frictionless, more efficient and more intuitive.”

Castillo says the company is in the final stages of developing the new app, which will include in-app delivery functionality and an improved customer loyalty experience. It expects to launch the app before the end of 2020.

Even with a recovery roadmap in place, Castillo admits that the long-term outlook remains unclear. She says more than 80% of North American locations have reopened and Freshii is optimistic the others will follow suit come September. But for now, the marketing team is constantly needing to “learn and adapt” and is generally planning no more than four weeks in advance.

Outside of its pandemic recovery efforts, Castillo says building a strong innovation pipeline that can tap into emerging trends is one of her many priorities as the new lead marketer. She has onboarded Grip and Wavemaker as new agency partners and will look to drive sales through more tactical efforts that account for the brand’s range of store formats and its continued expansion into new retail channels.