At a Glance: In-N-Out Burger
Founded: 1948
Headquarters: Irvine, Calif.
Locations: 260 locations, mostly in California; scattered locations in other Western states including Utah, Washington, Texas, Arizona and Nevada.
Revenues: Private corporation, though Orange County Business Journal estimated its 2010 revenues at $465 million.Pull up to any of the more than 250 In-N-Out Burger restaurants, and you’ll see a striking resemblance to another fast-food chain— but in color only.
The chain’s red-and-white motif, with a signature yellow boomerang arrow, may look like a McDonald’s restaurant, but the company has a much different appeal. Anchored in the nation’s Western region, In-N-Out Burger basks not in Happy Meals or Big Macs, but in food characterized by purity on its menu: 100% vegetable oil, 100% ice cream and 100% pure beef. There is a certain curiosity, if not mystery, about this 63-year-old family-owned company that shuns the press (including this one) and yet two years ago was named the country’s best quick-serve restaurant in a survey of 94,000 users. Here are just a few of the ingredients that distinguish In-N-Out:
- Customization: From inventory to retail, a sense of exclusivity pervades. Tomatoes are grown specifically for the company’s burgers, and buns are baked just for them. Potatoes are pared and sliced at each location.
- Freshness: In-N-Out does not use microwaves or freezers. No meal is prepared until the customer places an order.
- Family Control: The eatery refuses to franchise and has not expanded too far East of its original Southern California base. With few exceptions, the menu has not varied in more than 60 years. And many of its employees have worked the counters for two decades. In a word, the company is about one thing: culture.
“This is as much a part of the In- N-Out brand as are the palm trees out front,” says James Sinclair, a principal with Los Angeles-based OnSite Consulting, a national hospitality and restaurant consulting company with a focus on food and beverage and fast-food restaurants. “Their growth model has to include new distribution plants so that their loyal customers don’t ever question the fact that the product is fresh and not frozen. This also gives In-N-Out control over the raw goods; they are never in a position to hope that the stores are ordering from the right company or that the local store manager understands what the fresh product should look and/or taste like.”
In-N-Out Burger is a study in nononsense food, served up with a hardto- explain appeal.
Happy Customers, Happy Workers
A visit to In-N-Out feels like an outtake from the movie “American Graffiti”: a trip down memory lane with traditional burgers, fries and shakes, from which a devout customer loyalty emerges.
In some Western states, for example, locals have launched signature drives to petition bringing an In-N-Out to their town. When one opened in north Texas, customers camped out the night before to be among the fi rst to order.
From its red festooned palm trees on its cups and fry trays to the online store’s fries and burger Christmas tree ornaments and In-N-Out golf balls, something about the whole In-N-Out package creates a built-in network of fans who promote the brand, unsolicited.
When an In-N-Out was about to open in Arroyo Grande, Calif., a fan posted the following on an online forum in anticipation, a sentiment resembling that of a heavy-metal groupie:
“I am pumped to have In-N-Out open here in [Arroyo Grande]. … As for the line, it took me 30 minutes total to stand in line and receive my food. I went about 12:45 p.m. opening day, so I didn’t expect to wait any less, and there was a line just to get into the parking lot being blocked off by all the drive-thru-ers. I’m sure it will be busy for a long, long time, though. But always worth the wait.”
Not only do customers want to patronize the food offering, but they also wouldn’t mind working for the company. In 2008, when In-N-Out announced it would be hiring about 50 people for a new location to open in west Sacramento, approximately 500 circled around the block to place their application. The same episode played out in Utah the following year and in Santa Rosa, Calif., the year after that. It happens all the time. Folks are eager and anxious to be a part of the In-N-Out staff.
It makes one ask, seriously: What is the story behind this excitement and success? Dennis Lombardi, executive vice president of foodservice strategies for Dublin, Ohio-based WD Partners, believes much of it can be attributed to a controlled geographical West Coast presence, a limited menu and “offering the theater of fresh food,” he says. “Customers love to watch them hand-cut the french fries.” To watch the brigade of red pants, white shirts, black bowties and white aprons slice and dice potatoes is a spectacle in itself and part of the pageantry of fast-food served up with a smile. It complements the freshness in its food.
“Does freshness and quality matter?” Lombardi asks rhetorically. “Yes, they absolutely do. And the rise of ‘fast casual’ has increased the focus on higherquality menu offerings, products and ingredients. But it’s not the only consideration for customers. Value, cleanliness, speed of service and a convenient location are also very important attributes when people are choosing where they will eat.”
“The founders, Harry and Esther Snyder, held the exceptionally strong belief that to be successful, you served the freshest, highest-quality burgers and fries; treated your employees well; and [treated] your customers even better,” says organizational psychologist Billie Blair, president and CEO of Change Strategists Inc., Los Angeles.
Simple Formula Wins
In-N-Out doesn’t doesn’t seek out fame and glamour, but it seems to get it anyway because of an unspoken dedication to ordinary people wanting good traditional American burgers and fries. Sinclair of OnSite Consulting says In-N-Out is a classic offering of quality and service coupled with nostalgia and ambiance.
“In-N-Out does not misstep,” says Sinclair. “They know what works for them and they do not get tempted to change due to greed. You don’t see them in amusement parks or on Hollywood Boulevard. They are on highways and major boulevards. They have always gone after the ‘everyman’ consumer.”
In some ways, its branding strategy seems easy: Make the ordinary extraordinary, and think like a customer. “This company shows the power of a strong brand,” says branding expert Scott Creamer, CEO and founder of The Screamer Co., Austin, Texas. “Burgers are commodities and competitors are everywhere. But In-N-Out Burger made itself special.”
The chain hasn’t spent much on advertising over the years, Creamer says; it prefers instead to build its brand through oldschool word-of-mouth marketing. The company capitalized on that in the early ’80s, when it gave away bumper stickers and used them to initiate a sweepstakes, which turned into a popular promotion with little investment.
“The company motto is, ‘Quality you can taste,’ ” says Creamer. “Sure, they’re serving up burgers, fries and shakes, basic stuff, but it tastes healthier than the usual fare. “Consumers felt a connection with In-N-Out’s simple, almost quaint brand, and it was clear that Rich knew the value in preserving that,” Creamer continues, referring to the son of Harry Snyder, In-N-Out president since 1974. “I think the brand harkening back to an earlier time when food was simple and not laden with the overprocessed additives, etc., is another smart aspect of this campaign. It’s a great visual/psychological marketing strategy. The same is true of its limited menu. It’s what we were used to before we became the nation of choices.”
Another interesting component of its branding strategy is that less hype means more demand. Rob Frankel, an independent branding expert, says In-N-Out’s approach underscores the trademarks of a successful brand: authority, credibility and clarity. “It chooses to keep its executions basic and free of slick overhype,” Frankel says. “As a result, the public understands and can articulate why they prefer In-N-Out to other brands.”
Menu Modesty
In-N-Out’s menu is something of a lesson in the grandeur of simplicity. There’s nothing sophisticated about its offering: burg- ers, fries, and shakes—common choices for a classic burger joint. But there’s a unique parlance in what one asks for in an order.
The company ironically refers to it as its “not-so-secret” menu, developed by customer preference. For example, “Animal Style” refers to extra spread, onions and pickles fried into the burgers as they’re cooked. A “Double-Double” is double meat, double cheese. The “3 by 3” selection is simply three patties stacked high with or without certain fixings. “4 by 4” is the same with four—yes, four—patties.
There are no menu gimmicks at In-N-Out Burger. “Their ‘secret’ menu,” says Lombardi of WD Partners, “was created by their own loyal customer base (hence, not-so-secret), and predicated on the fact that In-N-Out will happily create custom orders. It was never any marketing campaign, but it certainly helped them build word-of-mouth buzz.”
Lombardi likens this “insider” culture to Starbucks’ early growth period. “Their ‘super customers’ took pride in knowing the brand’s coffee vocabulary, and being able to order coffee beverages using the baristas’ lingo,” he says. “Menu gimmicks can never take the place of offering good food and good service. And no one in the foodservice industry considers In-N-Out Burger a ‘ho-hum’ restaurant choice. “Any private equity firm that I know would love to own In-N-Out. It’s an excellent brand with an excellent reputation.”
Not Ray Kroc
In-N-Out developed as a company at about the same time that McDonald’s did.
“The Snyders made the personal decision not to expand for expansion’s sake,” says Blair of Change Strategists. “In fact, they were actually opposed to expansion but were talked into branching out by their employees. In other words, they were actually opposed to the ‘fast food’ that Ray Kroc of McDonald’s espoused. Their philosophy has stood the company in good stead through the years—it’s been hugely successful in California, and customer demand was the reason for expansion to other states.”
Perhaps author Stacy Perman sums up the company best in the prologue of her book “In-N-Out Burger: A Behindthe- Counter Look at the Fast-Food Chain That Breaks All the Rules”: “Not a mere burger joint, In-N-Out was an iconic institution that obviously stood apart. As I worked on the book, I grew to believe that the story behind its success had something to do with the way the chain evoked the kind of passionate following that could only be described as a cult phenomenon.”
In-N-Out’s Menu Lexicon
If you’ve been to an In-N-Out, you already know the slang. If you haven’t and don’t want to come across as a newbie, here’s your quick guide:
Animal Style: Refers to extra spread, onions and pickles fried into the burgers as they’re cooked.
Double-Double: Double meat, double cheese.
3 by 3 selection: Three patties stacked high with or without certain fi xings.
4 by 4: Same as 3 by 3 but with four patties.
Protein Style: Your favorite burger wrapped in lettuce instead of a bun.
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.