Ron has done it all in retail. Big box, mall-based, department store, upstarts, and for the past 6+ years he has helped dramatically grow the Kilwins Franchise system in number of units (110 at the time of writing), total revenue, and unit economics. At a time where confectioners like Kilwins seems to be subject to many market forces outside of their control – American dietary habits, sugar consciousness, discretionary income, vacationing habits – premium chocolates are enjoying double-digit growth according to the National Confectioner’s Association. In this month’s CMO Outlook, Ron outlines his approach to working as part of a solid management team to design and operate within a brand framework whose business results are unmistakable.
CMOO: Tell me about Kilwin’s and your model.
RB: “Kilwins started as a bakery in 1947. Soon after, the founders started experimenting with confections. Confections is a much broader, more elegant concept than just candy. We have several manufacturing/distribution plants that create and store confections and ice cream, and we make and ship all of our own product, except for what is hand-crafted in each store, in full view of our customers. So in a sense we’re a blend of several facets. Manufacturer, retailer, and entertainment. It’s not just the exquisite product quality, but the visual, immersive environment in which the products and people interact with our customers, that creates the full Kilwins experience.”
CMOO: There probably isn’t a notion in marketing more misunderstood than brand. And vastly underutilized. Yet you seem to master its intricacies in a fluid market to drive tangible business performance. How do you do it?
RB: “With Kilwins we’re shaping an experience around our notion of confections and our customer’s total experience when interacting with our products, people, and space: the aromas, absolute perfect product quality, visual sensations, the care, the attentiveness, physical space, selections, display, product knowledge. Kilwins is a vacation experience—both formal, time away with the family, and informal, a 15 minute indulgence during the day. And that experience needs to be exquisite. Understanding clearly what constitutes an exquisite vacation experience, what it means to our customers, allowed us to frame all these dimensions of the Kilwins brand. Within this framework, your actions are guided, your franchisees actions are guided, decision-making becomes less subjective and you can control and steer the brand without losing, and in fact, enhancing, its integrity.”
CMOO: What are the dimensions of the Kilwin’s brand?
RB: “Me and the other managing partners of the Kilwins team—who are all subject matter experts in their own right—have distilled eight brand levers we put in priority order when we look to take on any initiative. It’s the same pillars any retail brand has at their disposal. We just choose to act on them with earnest. The brand pillars are, in order, 1. Product, 2. People, 3. Place, 4. Presentation, 5. Price, 6. Packaging, 7. Promotion, 8. Publicity. If we have a dollar and a day, we will always look to put it into product, from the vantage point of how can we make it better, never how can we reduce overall costs to improve the margin. That’s not our brand. From there we look for the perfect people to franchise our locations and their perfect people to provide the in-store experience. And the third brand lever is the perfect place. Those top three priorities are non-negotiables. We are extraordinarily careful who we let in as operators and where we place locations. Our president, Don McCarty, has instilled in us a critical lesson, in that if there’s a mistake made at the brand level, it’s multiplied by the number of locations we have. Having a clear understanding of our brand framework and brand priorities helps reduce this risk and, at the same time, allows us to take on new opportunities with confidence.”
CMOO: Can you give a tangible example of how the brand framework manifests itself in a Kilwin’s location?
RB: “Bacon was a hot culinary subject for the past several years. We were under pressure from some franchisees and some customers to jump on this trend. We want to be ‘trend-right’, but not trendy. Given our customer base, our brand is not about driving trend, but understanding those trends that become more permanent fixtures in the American palette and sensibilities. And we ultimately decided bacon products ran counter to our notion of confections within our brand framework. So bacon came and went. Sea-salt caramels, however, is an entirely different story. We were actually a little behind in adapting to this trend because we wanted the product to be absolutely perfect, an exquisite sea-salt caramel experience. And we didn’t look at sea-salt caramel as a product addition, rather a platform from which a range of offerings and experiences can develop, sea-salt caramel ice cream for example. We are the only national retailer where vanilla is not our #1 flavor, sea salt caramel is. It is beyond belief.”
CMOO: Tell us about your customer base?
RB: “It definitely skews toward the younger end of the Baby Boomers, older end of Gen X. However we’re having a new generation of Millennials becoming avid Kilwin’s fans. Kilwins is perfect for today’s Millennial. As an exquisite experience, it begs for sharing. Millennials are anxious to share, and have different privacy boundaries; a different understanding of what community is and what can and should be shared. When your first reflex is taking a ‘selfie’ with your ice cream, we have to understand that’s a part of their experience and understand how to use that so it fits within our brand.”
CMOO: Coming from non-Franchised retail into a franchise system what did you bring to Kilwins and what did you have to learn?
RB: “I have 110 people who believe they understand how best to run their businesses. And in many, many respects they do. They teach me a lot. I listen a lot. On the other hand we have a brand framework designed to protect the very thing that drives their business, even if they don’t always see the full ramifications. And I have a right to insist on adhering to the framework. The line between supporting our franchisees, saying ‘yes’ as much as I can, and standing firm on the brand framework, is constantly evolving. We want our franchisees expressing themselves to be the very best personification of the brand. And, at the same time, all we have, if we want to continue to grow and evolve, is a brand framework. I need to bring franchisees along in a far different way than my past store managers in corporate, non-franchised retail. Positive impact to the bottom line does buy a lot of credibility, however.”
CMOO: What’s on the horizon?
RB: “There are three significant initiatives we have underway: in 2015 we started 1. Take-it-Home Quarts of ice cream and 2. Gourmet Cake & Ice Cream. Regarding the latter, forget everything you’ve known about what an “ice cream cake” is. We’ve reinvented what an ice cream cake is and it’s simply a must-try. Both programs are ramping up extraordinarily well. 3. We also have developed an internet business that makes sense for Kilwins. It allows the franchisees to fully participate and get some credit for the sale. As well, with orders fulfilled from their local Kilwins, there’s a real, vested person in the transaction who handles the order with care and can address any issues that may arise. One of our newer programs is our Single Origin chocolates platform, where we make chocolates and chocolate products with cocoa from specific growing regions of the world like Peru and the Dominican Republic. Each takes on a different characteristic based on soil and climate differences, much the same way premium coffee does.”
CMOO: What would you leave your readers with?
RB: “Think about this. What would life be like without branded experiences? How would you navigate purchase decisions to get what you need? If you went to the ice cream aisle and all packaging was white with the same font labeling, how would you make a decision based on the ice cream experience you were looking for? Brand conveys information in a shorthand way to consumers. The brand pillars are the way that information is communicated. Every retail brand gets the same brand pillars. Those who succeed or don’t do so for the same reasons, prioritizing and applying the pillars. If you figure out your brand levers, you can make a brand come alive. But it takes a concerted commitment. Good, bad or indifferent, it’s how our world works.”
Learn more about Ron Brunette here and Kilwins here.