Cobs Bread takes steps to tap new avenues for growth

The bakery franchise is prioritizing convenience and a digital loyalty program in order to meet its bullish expansion goals.

Cobs Bread

Bakery franchise Cobs Bread has a ton of formidable competitors that range from national grocery store chains with robust bakery sections to local cafes and breakfast shops selling baked goods and beverages to on-the-go customers.

That hasn’t prevented the franchise, which has grown to nearly 130 locations since its first shop opened in North Vancouver in 2003, from experiencing strong sales growth before and during the pandemic. Heading into March 2020, same-store sales were up around 7% and transactions were growing at around 3%, says Brad Bissonnette, Cobs Bread’s VP of marketing.

And Cobs’ financial performance has only improved during the pandemic, with the crisis nudging consumer habits in a positive direction for the brand – with more Canadians prioritizing health, preparing and consuming more meals at home, and moving into more suburban communities where Cobs has a strong presence.

“The stars are really aligning for the brand and a lot of it has to come down to the consumer trends and where those trends will go in the future.”

According to Bissonnette, same-store sales growth has now reached 17%. While the number of customer transactions has remained relatively flat, average transaction value has risen by nearly $2, and the average bakery is now delivering an operating profit that allows franchisees to recover their investment in less than three years.

These trends have made Cobs more bullish on its Canadian expansion plans. Whereas it previously planned to open around 10 to 15 new bakeries per year, Bissonnette says it now believes it can double that growth, opening 20 to 30 new locations per year over the next five years.

But while some consumer trends have worked in its favour over the last year, the pandemic also forced the company to find new ways of addressing what Bissonnette says has long been its biggest barrier to growth: convenience.

“Ultimately it’s more convenient to add your bread into your grocery cart at a grocery store, or grab your baked treat from a cafe,” says Bissonnette. Over the last year, the priority was to continue focusing on the customer service and high-quality product Cobs is known for, but also to “chip away at convenience,” he says.

COBS_FRANCHISE_2019-0009 (1)After ensuring its bakeries were providing a safe environment for customers, the company’s second priority was to expand the channels through which customers can order its product. Cobs negotiated partnerships with Uber, SkipTheDishes and Doordash at a corporate level, giving franchisees the option of offering delivery to customers. It then rolled out a click-and-collect platform across its entire network.

As part of the next phase of its three-year digital customer experience plan, Cobs is evolving its Loaf Rewards paper loyalty program into a Cobs Club digital loyalty program, which launched a month ago and is currently being piloted across 16 locations in Canada and U.S.

Bissonnette says Cobs Club will be expanded to around 35 or 40 locations within the next month, with plans to go network-wide in late July or early August, before starting to promote the program more widely in September.

Phase one of the rollout is focused on collecting points. However, with time, Bissonnette says it hopes to build Cobs Club into a more comprehensive app experience in which customers can place orders, discover new product launches, and even test product innovations before they go to market.

The September launch of a digital-acquisition campaign for Cobs Club will also mark the return of a more heavy promotional period for the brand, as the company aims to drive brand awareness and traffic to its stores following a more quiet summer period focused on marketing around barbecue season and potentially the return of small celebrations and gatherings.

“In many consumer minds, we’re positioned as the place to go for a special occasion,” says Bissonnette. “And so our focus is to continue to transition consumers from going to Cobs Bread for a special occasion, to coming to Cobs Bread for every occasion.”

Cobs continues to work with Will, the Vancouver creative shop behind its new “Celebrate Fresh” brand positioning launched a few years ago, as well as Major Tom on digital initiatives.