Episode 16 - Justin McCoy
Jennifer Kern: [00:00:00] Good morning, everyone. This is Jen Kern. The host is here at restaurants reinvented. And today I'm joined with Justin McCoy from Cousins Subs. Hello Justin.
[00:00:34] Justin McCoy: [00:00:34] Hello, Jen. Thanks for having me.
[00:00:36] Jennifer Kern: [00:00:36] Thanks for joining and you're out there in Milwaukee. I see.
[00:00:40] Justin McCoy: [00:00:40] I am. I am we went from summer to fall very quickly, but we have a little bit of warmth out here, a little sunshine. So we're enjoying it before we, get snow.
[00:00:47] Jennifer Kern: [00:00:47] same. It got really cold here really quickly in the last week in DC. thanks for joining from Milwaukee. It was actually, I was thinking about it this morning when I was getting ready and I'm like, that was my last trip. Pre COVID is I flew out to my son, graduated from bootcamp and Chicago with the Navy.
[00:01:02] And we got to take him somewhere for eight hours and he said, I want to go to Milwaukee and have a bratwurst and a brew.
[00:01:08] Justin McCoy: [00:01:08] Awesome. good spot to go. my last trip was Scottsdale Arizona before. I was actually in Scottsdale. I arrived on a Wednesday night. I was actually out there for like a sponsor party. I do advertising with Fox sports, Wisconsin with the brewers. So I was out there for a bruise trip. We flew in on a Wednesday.
[00:01:23] I went out to dinner with my Fox sports rep and that night was when the MBA. Announced the first positive test with Rudy go bear. And the rest of that trip through Sunday was like just the domino effect. So when I came back, I went into quarantine immediately. My work, and I decided, cousin, my leadership and I, we decided that will be what I would do.
[00:01:42] So I was actually in quarantine two weeks before everybody else was.
[00:01:44] Jennifer Kern: [00:01:44] Oh, wow. So that was early March, I assume.
[00:01:46] Justin McCoy: [00:01:46] Yes. Yep. It was that first week of March.
[00:01:49] Jennifer Kern: [00:01:49] Same. So , we're going to have to need to do a podcast or a content piece or something like everyone's last trip before quarantine. What was it? interesting. It's I think it's a memory for everyone. yeah. Yeah.
[00:02:00] Justin McCoy: [00:02:00] Yeah, it's absolutely. I was talking to someone recently for being someone who probably has been traveling every six to eight weeks for probably about the last five to seven years, to only have driven up to my parents and see my family two hours away and basically just stay in my little bubble has been so weird.
[00:02:15] Jennifer Kern: [00:02:15] I know. I get a little restless from time to time. But anyway, let's go ahead and get the show started. I know our listeners are going to be excited to hear what Cousins is up to and especially what you've been up to. I know you've had a nice career at Cousins subs. So for our listeners who may not know you, could you give us a little bit of background about yourself and what you're up to today at Cousins?
[00:02:34] Justin McCoy: [00:02:34] Yeah, absolutely. So I mentioned, driving two hours North, so I'm from a small town in Northern Wisconsin. I moved down to Milwaukee when I was 19 to go to college, graduate with a degree in communications, put myself through college, working in finance, oddly enough, being a marketing guy now. While I was in college and working in finance, I was also interning doing PR media relations for the Milwaukee bucks.
[00:02:52] And I did that for about four seasons. I thought that I wanted to go into some sort of level of sports management or something like that. So moved down to Florida was going to go to grad school for that ended up not doing it, came back to Milwaukee and it was still in finance and made it about two months at a financial institution Milwaukee when I came back in my late twenties and decided I need to get into marketing communications. It's what I love. And I saw an entry level position open at cousin's subs, and I took a flyer and I applied. And I got the sensory level position. It was a guerrilla marketing position. My job at the time was literally to take sub sandwiches out in the morning and give out samples and coupons and talk to businesses and try to get catering counts or orders in the afternoon.
[00:03:28] I'd take out fresh chocolate chip cookies and do the same. And that was really where I started, from there, every year for the next several years, I was promoted got up to director a marketing at cousin subs was in that role for a couple of years and then got the opportunity to be named and termed VP.
[00:03:43] And, did that for about nine months. And after that, Christine Spect, our CEO and president, offered me the role of vice president of marketing and cousin subs. And the rest is history, but in the role now for about, I think it's been about seven or eight years and it's just been a great ride for me.
[00:03:56]Jennifer Kern: [00:03:56] I've had over 15 guests now, all, from restaurant brands and most of them have worked, I'd say five or six places like myself. But the average tenure of a marketer, at least in the B2B tech space, is often cited around a year and a half. So when I looked at your background, I was like, this is so cool.
[00:04:16] He's been at cousin's for over 14 years. tell me. What kept you there?
[00:04:22] Justin McCoy: [00:04:22] Yeah. So when I was in the financing industry, putting myself through college, I worked for these really large banks. So I came from a very small town. I grew up working on farms, just doing all the things in a small town kid would do. when I moved down to Milwaukee, it was very excited to be in the city.
[00:04:36] I knew it was more for me. But these roles of these corporations that were just so hierarchal and so huge, I never really felt at home anywhere. Once I got to cousins, which is a family owned business, at the time when I joined, there was probably about 40 people in the corporate sport center.
[00:04:51] I got to know Christine and Bill, I went from being, working at places like if you've ever heard of Northwestern mutual or RW bear, which is huge financial firms here, I am at cousins as an entry level employee and on a daily basis, I'm crossing paths with the president and CEO of the organization, the vice presidents.
[00:05:06] And it was also just a culture that was very family oriented. So it was a combination of work that I really fell in love with as I kept moving along, because as I moved up into upper management, getting onto the executive team, I really was able to incorporate. Every aspect of marketing that I enjoyed today at a company, my size, I oversee PR I oversee marketing and advertising.
[00:05:27] I do TV and radio, Creation and all these different things, websites, social. So everything's under my umbrella and these are all things I enjoyed in big organization you might be a leader over one of them. So the combination of a family environment someplace that, it really felt like home someplace that I felt every day from even that entry level position on up where I was making a true impact on the business.
[00:05:50] Just really has kept me there. And, sitting here today, I think January will be 15 years. I'm to the point where this is, I feel part of the family, I feel very invested in what we're doing. I've been given a lot of leeway to put my mark on the organization, along with the rest of our executive team.
[00:06:06] And that's really, what's kept me there this whole time.
[00:06:09]Jennifer Kern: [00:06:09] that makes a lot of sense. gosh, as you're talking, I'm thinking that's what everybody wants. They want a place where they can work that feels like home. That feels like family. And the fact that you've been able to flex and do a lot of different roles, it sounds within the organization and learn a lot and grow and I've heard they have a really good training program as well, cousins and leadership and mentorship. it's just a huge Testament to the company really. that they've been able to keep you, I mean, maybe to know that you are way out lasting the typical tenure for marketers, We jumped around.
[00:06:42] Justin McCoy: [00:06:42] I would say that's true of all the executives in the organization, we have several staff members that have been with you organization for 40 plus years. Actually our senior director of purchasing started working in one of the first stores that ever opened. Our warehouse manager worked in one of the very first stores, our, executive administrative assistant.
[00:07:00] And then we have a whole another wave of, staff that are like me from about 15 to 20 years. And then we have this group that are part of my team and some of the other teams that we hired them on. And now they're getting into that five, seven year mark. So there's definitely been, you can see that what I fell in love with is also something that many of the other staff members feel the same about.
[00:07:22] And I'd say it's the same with our franchisees. We have a lot of longterm franchisees too. When we get together for an annual meeting, it's like a family reunion and that's something that's just really awesome too. I learned that very early on when I worked in the field going out and literally just trying to support franchisees, I would never change the path I took at cousins because of that time in the field and getting to know their franchisees. Now that I sit at a desk most of the time, and I'm not out in the field as much as I was before. I still forge these relationships and understand what they have to do every day. And, my number two, my director of field services is the same as me.
[00:07:52] He was one year behind me and as I was promoted, I promoted him. And so he's been there that long. and so the team is very much, very much ingrained in the culture that we have.
[00:08:01] Jennifer Kern: [00:08:01] Yeah, and that was going to be my next question. Have you had that same luck with your team members staying that long? So you have one that's followed you, which is phenomenal again, a huge Testament to you, to the leaders of the company. I know Christine has been there a while as well and doing a phenomenal job.
[00:08:16] That's a huge Testament. What have you found on your team? Has there been higher turnover or not?
[00:08:21] Justin McCoy: [00:08:21] So I also have a brand manager her title is brand manager. She started as a graphic designer, but now she leads all design elements with me. She's also been there about 13 years. So that's on my team as well. And then I have a group that have been there for around between three to five. I have had some turnover in positions that I call a specialist position. They would be more of what we tyipically know. Younger people coming in, they're in an entry level role, my hope is that I can keep them, but there's also, we're only so big right now. So if we get a high quality specialist, if I have a high quality PR specialist or a high quality digital and social media specialist, If I can retain them for two to three years and really set them up for success as they move forward.
[00:08:58] That's what we try to do. Now, if we have an opportunity and someone is just extremely talented, we do everything we can to retain them, but also it's dependent upon, how big is our budget, what's our need, but there has been some turnover at that level, but it's always been when exit interviews have been done over the last few years is it's not really been about the it's been about, we just don't have the room for them to grow. Because I have tenured individuals on the manager and director level below me. So it's truly been, a lot of them will come to me and it's I can tell that they don't want to leave, but I understand why they are.
[00:09:28] And that's one thing that I talked to them about is that, we appreciate everything you've done for us and understand that you have needs for you and your family as well. And if I don't have an opportunity or a path for them to continue to grow, totally understand that. So we've had a little turnover on that bottom, on the entry level positions, but for the most part of the manager and director level position has been very tenured staff.
[00:09:46] Jennifer Kern: [00:09:46] That's awesome. that's so great. I love it. so let's talk about the brand a little bit, and for listeners who might not be familiar with your brand and your product, we talked a little bit beforehand. I'm an East coast girl, so I have to be honest and say, unfortunately, I have not had your food, but it looks amazing.
[00:10:01] I was just on the website, as I said, and like, The milkshakes and the pretzel buns and the, Oh my gosh, it just looks amazing. And I know you have a very strong reputation out in the Midwest and Wisconsin particular and Mia branching out into Illinois. But for folks who don't know the brand, can you tell us a little bit about the brand?
[00:10:17] What makes you different from some of the other sub shops out there?
[00:10:21] Justin McCoy: [00:10:21] Yeah. So we're definitely today, East coast meets Midwest, for sure. As you saw when you looked at the menu, but we were founded in 1972 by Bill SpecK and his cousin, Jim Shepherd. So we're named Cousins subs because we were founded by two cousins. Bill Speck, is from New Jersey and he moved out to Wisconsin with his wife, Sandy.
[00:10:39] When he got out of here, he started working in the print press industry and he basically had sub sandwiches in Milwaukee and he was missing his favorite sub from the East coast. So cousins is actually, the base level creative idea comes from a sub sandwich shop out there called white house subs.
[00:10:54] In the Jersey shore. So if you look them up, white house subs is still out there today, but, Bill was missing his favorite sub sandwich. It basically is a sub with fresh ingredients, a Italian bread with a crunch in the crust, hot subs featured on a flat top grill. French fries. And that was really the baseline for bill to start cousin subs with Jim.
[00:11:12] When Jim decided to move out here with him and start the adventure. So we do have our roots in the East coast. And like I said, we have a deli fresh and classic subs, which are, we've been slicing our meats and cheeses since 1972, that's nothing new for us. And like I said, the hot subs are made on a grill.
[00:11:28] So we have a cheese steak line where you can get USDA choice steak, or you can get all white meat, chicken grill for any hot sub. And really one of the things that I have brought in evolve things a little bit is to get that touch with them West. So today we only use Wisconsin cheese. We partnered with the dairy farmers in Wisconsin.
[00:11:45] We proudly promote the fact that we only use dairy products from Wisconsin. So all of our cheeses are from Wisconsin. We have a Wisconsin Mac and cheese it's made with Wisconsin cheese. We have Wisconsin cheese carers that we deep fried the same, fried vets that we do are very tasty, French fries. And you mentioned the milkshakes.
[00:12:01] So our shakes are new. the shakes and the macaroni and cheese are pretty new, but the shakes they're also made here in Wisconsin as well with all Wisconsin dairy. So it's really a blend of East coast meets West today, and really Our edict is that quality has no substitute So we bake that bread fresh Every day we slice the meats and cheeses We look for high quality ingredients and we basically source locally whenever we can So all of the dairy products are sourced locally We also try to source meats and other products locally as well And as we continue to look to expand in the Midwest we're looking at other products that can do that for us but that's basically the gist of the menu at cousin's subs
[00:12:34] Jennifer Kern: [00:12:34] That sounds amazing Oh my gosh So you slice all of the meats and cheeses in each store
[00:12:41] Justin McCoy: [00:12:41] Yup
[00:12:41] Jennifer Kern: [00:12:41] Like fresh Oh great
[00:12:42] Justin McCoy: [00:12:42] Yup and we bake bread daily So we have a proprietary bread recipe that bill and Jim created based off of their experience at white house subs And those things are done every day in the store
[00:12:52] Jennifer Kern: [00:12:52] That's so cool Well I love that story I mean for sure New Jersey and the influence from New York and Philadelphia they are known for their Subs So I didn't know that's really cool That's very cool And your menu it looks like it's expanding Tell me what Role do you play in terms of menu innovation and how do you guys make those decisions When you have new items coming in on the menu and you decide to retire old ones
[00:13:16] Justin McCoy: [00:13:16] So I like to fancy myself as a home chef I love to cook and I am very blessed to have the opportunity to actually run menu development for us So limited time only subs are a big part of what we do So we're constantly looking to evolve the core products Like I said we introduce new things like Five six years ago is when we introduced the cheese curds We introduced the Mac and cheese I think about two and a half years ago The shakes were last year So we do consistently look at how do we evolve the core menu but at the same time we try to keep that core menu fixed to limit the number of skews and also keep our operations efficient for what we do So we try to balance out the number the need for new products along with Ease of operations And I was able to execute in a speedy and accurate fashion for our guests But we do usually between three to four sets of limited time only subs a year So you probably saw when you went on the website that currently we have our monster subs So we're calling it a monster mash at cousins subs basically you can get a Turkey chicken or a steak monster that features Wisconsin monster cheese bacon lettuce and tomato ranch dressing and our famous hot pepper relish So that's an example of a limited time only sub that we have right now So we try to those limited time only subs have some fun But we also have to make sure that they fit our guest base there's many cool subs I've made in the kitchen but they're probably not things that are right for our guest base So we try to stay We're in the Midwest They're Hardy subs So that's typically what we're looking to do in the past For example we partnered with Johnsonville Brocks and we've done a steak and broth so it has these quarter sized broth slices on with cheddar cheese and then we have a broth and bacon on pretzel bread So there are these very indulgent Hardy subs that our guests just seem to really enjoy
[00:14:50] Jennifer Kern: [00:14:50] and what's your favorite menu item
[00:14:52] Justin McCoy: [00:14:52] My favorite menu item my cheat meal is a pepperoni melt on Parmesan Ozzy algo bread And I add a little bit of marinara and black olives So it's ham pepperoni provolone cheese grilled with onion tomato and lettuce and then it comes with Mayo And then I add a little bit of marinara and black olive to it So it's almost like a pizza sub but it's still got its own thing going on
[00:15:12] Jennifer Kern: [00:15:12] That sounds amazing Oh my gosh I'm a meat lovers meat person too So I like to pack it on And then that it's something that really I feel like you can only get it sometimes at the Jersey shore being from DC here which is they have that sauce it's not the Marinara talking about it but it's like the olive oil and the herbs and it's soaks into the toasted bun and you're like Oh perfect With the meats
[00:15:34] Justin McCoy: [00:15:34] Yeah So our Italian special is very much lately several of our subs we put a regular one pepperoni melts One of them our Hammond provolone our Italian special Then we also have an oil so we have very similar things at cousins
[00:15:46] Jennifer Kern: [00:15:46] Yum Okay let's talk about this difficult and challenging time we're living in right now right obviously the pandemic has been brutal for all of us in the restaurant business And I did hear you speak recently I think it might've been a few months ago on a podcast with Oh gosh I forget what Brett thorn
[00:16:06] Justin McCoy: [00:16:06] Yeah Yep
[00:16:07] Jennifer Kern: [00:16:07] Okay And you talked a little bit about some of the strategies that you've been using but walk me and the listeners through what it's been like for you there at cousins in the sub business during the pandemic what's the vibe
[00:16:20] Justin McCoy: [00:16:20] Early on much like everyone else it was Oh crap What are we going to do here how is this going to impact us What's going to be the bottom when we climb up what do we need to do for us I won't say we were in a unique position but we were in a fortunate position for us And that is because When I had the opportunity to move into the vice president role One thing that I talked to Christine about is I know we're a regional Midwest chain but we set out the goal to be somebody who was on the cutting edge of whatever was going on We just didn't feel like we had to be the mom and pop behind everyone And from a technology standpoint many development whatever it was And so the rest of my executive team members really bought into that and bought into that investment So we spent the last several years Truly investing in things like a robust online ordering program working with a what I believe best in class loyalty provider We invested in our technology infrastructure in our stores We Invested a lot of dollars into our website to make it be a eCommerce experience that was smooth and easy for our guests So we had actually been developing all of these sort of contactless order options without knowing this is the world we will going to be in So when this all hit I already had in place a website that could handle a tremendous amount of traffic from online ordering perspective I had an online ordering provider that I think is the best out there who has as continue to be on the cutting edge and providing us with that additional opportunities to basically get sales by doing things like Integrating third party delivery partners that then allow me to take third-party orders without tablets in my store because they're integrated with my online ordering providers So they can come to cousinsubs.com place an order and then it'll be fulfilled by third party And I don't have to have tablets in store and I'm able to set up more advantageous fee structures with them So I have online ordering had loyalty We had third party delivery We also have about 35% of our stores have drive through So we had all these things in place And When this first hit we're sitting there Okay how's this going to change Lobby's going to be closed up The biggest thing we need to do is we need to make sure people know that there's alternatives to order from just coming in the store being that we are in the Midwest I would tell you we have some slow adopters to technology So it was a matter of are we going to be able to convert those who are traditionalist coming into the brick and mortar and move them over to these other channels And not lose a huge chunk of business First couple of weeks in we were hit just as hard as anyone else it was a struggle we were down 30 plus percent We started running projection models to try to figure out okay what's worst case scenario What's Middle of the road and what's best case scenario So we put all those things in place So I quickly then had to me controlling advertising budgets national ad fund all these other things I had to quickly react and get us into a place of like all right should we hit worst case model I have to do all this So got all that in place Second thing was all right how can I with the limited budget we're going to keep an advertising and other things get out there and educate people about We have online ordering we have delivery We have all these other ways for you to order your favorite sub sandwich from cousins steps So I use the advertising dollars that we had to do that Thankfully we also had a pretty large Eclub and we also had a number of people signed up for the loyalty program already as well And we have a very active social channel We have local Facebook pages for every single location Instagram Twitter So we basically started flooding the airwaves which is education Cousin subs is open and here's how you can order from us The other component of that was we've never been shy about talking with media So I talked with Christine our CEO Jason my president and myself Christine and I typically have been the main spokesman and spokeswoman for the last several years Jason was new to the role but we wanted to make sure that the three of us were available for any outlet that wanted to talk about anything related to COVID to our experience and whatever And the reason for that was is that we would get the opportunity at the end of the any interview or in the midst of any interview that we had at any level To then also say Hey we're open for business And here's how you can order Even if we were talking about something such as labor or budgets or whatever we were going to do So we were very proactive in saying we're out here Anyone that wants to talk to us we're here to talk to you So that was everything from forbes magazines the local paper and green Bay Wisconsin to whatever we were constantly on the airwaves talking to people Those first four weeks I would say what we concentrated on was really just educating and creating awareness of you can order our product The only new thing that we added during that timeframe was curbside pickup We were able to literally in the first week of the first lockdown in Wisconsin where we have the majority of our stores we were able to work with that online ordering provider and the loyalty provider who built up or app to get curbside pickup launched So we were able to do that very quickly as well Beyond that I would tell you so the first two weeks we were down about 30 plus percent third week we were down a little bit less fourth week a little bit less I think we had one more week in there down comp sales And then from there we just actually ended a week ago and it was just because of a shifted labor day We had 20 straight weeks of comp sales growth So we yeah so We can't thank our little guests enough I can't thank our operators I can't thank our staff enough it was challenging It was challenging for the staff was challenging for us Our operations team we own about 30 units corporately The rest of the 70 other stores are around Some of the other stores are franchise we basically set up a pipeline of communication to the field as well So we Jason basically sent out daily updates on what was going on we held all system conference calls We were meeting with our franchise advisory council We were just very transparent all the way through So it was all hands on deck for internal communication And then it was just a big push for external communication to make sure everyone knew how they could order a product and what we began to see when we hit it around that four or five week Mark and then we went on that streak of comp sales growth I believe was it just took that month to really get all those people that used to come into the store to understand Hey we can still order our product and do it this way And cousins is doing it safely and we can get all the products that we enjoy And once that really got rolling we were rolling right along and today we feel very fortunate about all that and we're very thankful to be in the position we are because I know and we know that's not the exact story that the entire industry has seen but I believe that work we did And like I said pre COVID just us being aggressive and continuing to think about how we would grow our business was our lifeline If I look back two years ago we didn't have third party delivery I don't know how we or anyone else would have survived without third party delivery As crazy as that the whole topic of third grade delivery is I shouldn't say we wouldn't have survive but we certainly recovered more quickly because we had that available to us because we would have never been able to execute an internal delivery program Quick enough at the volume we were doing for the months of April and may and June we would have never been able to do that
[00:22:54] Jennifer Kern: [00:22:54] Yeah Wow That's first of all congrats it's heartwarming to hear one of the reasons I do the podcast is to spread some encouragement wherever we can And people need to see who's doing and try to emulate them it's as simple as that So you sharing all the things you just shared I appreciate it Congrats I took a couple of notes while you were talking because there's a lot of really good tips in there I think to share with other marketers and obviously the biggest thing that you had already been investing in technology before this happened like you said Blessed there that is definitely helped you significantly and that you had some drive-throughs like you said but the fact that you were already doing the third party delivery we all know how difficult that is to get up and running there's just a lot involved with getting that up and running And I know that you guys have cause I heard Christine too speak on a podcast about having the unified Stack And that is also huge there's a lot of people still trying to get to that and it's very hard It's so hard so that clearly helped you right
[00:23:55] Justin McCoy: [00:23:55] Yeah and the other concept what happened too is and this even happened to us so I had a primary partnership with a large third party delivery provider So literally the moment within that first week we had a discussion internally I was like we need to just add everybody else So we just need to get everybody else added We don't know how long this is going to go So I quickly reached out to the other two prominent third party delivery problem was is that they were so backed up literally in the third week to try to onboard anyone I can't imagine what it was like for concepts that had no third party delivery because it ended up being a two month process to get on board now I'm sure that was different for say a McDonald's or someone else Who's 10 15 20 30,000 units But we still had a hundred units to at least leverage And there was interest in us and they had a lot of interest in getting us on board but they still they just didn't have the bandwidth to get you on board So now imagine if you were a mom and pop or whatever the case was to be able to get up and running And so thankfully we had The two relationships we had with one of them being with one of the major provider or DSPs And then I was able to I think the next two major DSPs I was able to get up with and probably one was about six weeks and one was about eight weeks but yeah it was crazy
[00:25:09] Jennifer Kern: [00:25:09] Yeah so you're with three delivery partners now Is that right Three total
[00:25:13] Justin McCoy: [00:25:13] We're actually with four total we have a Midwest based one as well that was started in Madison Wisconsin They do very well here in the Minnesota Iowa sort of Wisconsin area And then we have three national TSPs that we also work with
[00:25:25] Jennifer Kern: [00:25:25] Yeah So absolutely having those things in place for sure but then you hit on three really important things one was as you talked about your crisis management plan essentially that you had this Worst case scenario it sounds like you were doing forecasting and some predictions and analysis around those things as they were happening But then yeah we put a plan together that essentially it was like Here's our worst case scenario for the business what's that going to look like Can you walk me through a little bit of that process How much financial analysis and planning and budgeting was involved with that and how are you in real time as no one knew what was happening from day to day how were you able to predict and move around with that
[00:26:03] Justin McCoy: [00:26:03] first and foremost I would I know I'm a bit biased but I think we have two the best financial minds in the business working for us I really do our president Jason Westoff when Christine put our current executive team together it was originally myself Joe Ferguson her and Jason West often Jason Westoff came to us from the largest Applebee's and pizza hut franchisee in the country They were called a Wisconsin hospitality group They were here in the Midwest He came to us as a CFO So he was my peer for many years on the team When Jason joined me as a marketer I was always starved to have a data to be able to make data driven decisions in what we were doing And marketing has become so much of that And Jason just brought such a wealth of knowledge and structure and systems and reporting And I was able to work with him hand in hand for many years before this about a year and a half ago At a certain point in his tenure he brought on JJ Gruby who is now our VP of finance And Jason has since moved into the president role but JJ Gruby was groomed by Jason and JJ very much the same very analytical mind but gets marketing So we at cousin's make every decision based on data There's nothing I do on any given day that isn't driven by data So I'm working on 2021 plan I have a two page email out to JJ to analyze everything that we're going through I being a bit of have a finance background I think in that manner while I'm also thinking about marketing So I get that backstory because when this happened we then had Those two with all that experience and all that talent who on a daily basis whether it's acquisitions or whatever we're doing putting together our plan are always forecasting things out so JJ really got to work on forecasting out what can this impact look like And like I said we can put together three different scenarios We make decisions early on based on the worst case scenario So by doing that I had to do a lot of work Yeah Just in terms of moving budget around cutting budget freeing items up Some of it was natural we are a very prominent partner of sports teams here in the Midwest where I'm a partner with green Bay Packers Milwaukee bucks UWF athletics in Madison So just because of them not even having seasons some of that went away and some are fast we're a big sponsor of summer festivals canceled So some of the dollars naturally came in just because events weren't happening and stuff like that But yeah so we worked off that scenario it was projections based on okay Here's what happened in weeks one and week two Okay if that maintains what's worst case scenario And so by then planning and working off a worst case scenario as we came to about week four and we started climbing and climbing And also now we were achieving Our sales plan that we had planned for before COVID Now we were quickly catching back up and through that 20 weeks we have now gotten to a point where we're back completely on plan And that's really a Testament to just those guys putting out Here's the scenarios that could happen Let's plan for it that way and work through that And so that was really how we approached everything that we were doing but it was all data driven even in the midst of the pandemic too we made a decision early on two of the tactics that I utilized was we subsidized the delivery down to a $0 fee so we were doing free delivery but that's very expensive you're talking anywhere from six to nine and bucks on delivery We're talking six figures worth of free delivery subsidization we were all so doing double points in our loyalty program So along the way JJ and I had to work hand in hand to go okay at what point do we not have to offer free delivery anymore so there was a point about six weeks in where we said okay we're going to move to three 99 I think it was two 99 what impact it's gonna have on us And then we were slowly able to creep out of that based on data where I think some carriers doing zero delivery fee at a really high cost we basically found that there was a threshold Where guests were like we don't care anymore because now we're ordering your product And even though you don't have free we want to keep ordering your product from a delivery standpoint So we were able to turn that spout off how much money we were spending on free delivery We also had to keep a very close watch on when we were doing our double points program with loyalty Loyalty was pretty new to us We'd launched it just the November of last year So we only had about four months four or five months in before this all hit So then we had to look at our discount rate How is that impacting what we're doing So again it was just really following the data to determine what decisions were best for us as we kept moving forward in terms of how we were trying to combat what was going on
[00:30:13] Jennifer Kern: [00:30:13] Yeah that's fantastic and such a great takeaway for marketers understanding the value of having a partner like that and finance and you two working so closely together I know I can do a lot of my best work when I am given the financial data like that on a regular basis And I can understand where those trends are coming from and where I should be investing differently or more So having that data driven approach is fantastic but even more importantly like you said having those peers and those partners in the finance department who are doing nothing but looking at that 24 seven the other thing you talked about was media and I know you guys you have a big name I'd like to say you punch above your weight You punch way above your weight Like I could easily have thought coming new into this industry that you are a thousand locations and we met really briefly at Meg Last year And I just remember you guys have a larger than life brand and a lot of that has gotta be due to the investments you've made like you said in media and TV and radio and PR that's fantastic What I'd love to know now is how have those investments shifted during the pandemic
[00:31:18] Justin McCoy: [00:31:18] Yeah thank you First off that was always the goal right And I would tell you as I was coming up and I had never produced a TV spot I'd never produced a radio spot when I was coming up through the organization I worked under a leader who believed in a traditional agency model and What I saw was a lot of what I felt was wasted inefficient dollars as we were going through As much as those productions were fun and they were great and all those different things I felt there might be a better way for us to do all of those different things And so in terms of us looking this big and how we do those things it was finding the right creative partners to produce more assets At a higher quality at a national level quality at a like 10th of the cost So I have developed a great friendship with a creative director here in the city of Milwaukee that dates back a decade now And we have been able to put out what I think is national level assets for literally like I said a 10th of the cost and that's through using nonunion talent That's you're using volunteers from our system that's from shooting in very efficient ways and just being very nimble in how we do things So even though we're a hundred unit brand we do have 70 plus units in Milwaukee So we have a fairly large budget Advertising co-op in Milwaukee So it didn't necessitate the need for having TV So pre pandemic We did have TV creative radio creative We do digital outdoor advertising all those different things But really throughout the pandemic I cut most of the TV that we had the TV buying so I guess if I was to say there was an impact we've done no new creative and we cut back a lot We're now coming We're now back on the air because our budgets have balanced out and we're able to achieve the budgets we had in place previously So I had a period I'd say from about March to probably may Where essentially I focused in on radio because I was very flexible and promotional driven and we use some digital outdoor and beyond that it was really just our loyalty programs our social channels and those other spots and PR frankly just being out there reaching out to partners to see literally reaching out to media partners and telling them If they want to do trade if they want to do gift card giveaways I would be happy to do anything we can to be a part of what's going on And when you have those longterm relationships with them many of them would bring us on And I was able to go on and talk on ESPN Milwaukee and different radio channels that were just happy to support us because they knew it was a tough spot Even if we were having to cut the dollars many of them wanted to support us because they knew it was in their best interest also support us And we're very thankful for that as well So it did evolve I think the only other thing that I haven't touched on was just that PR element of community too we're very involved in the community And we have our own 5O1C3 it's called the make a better foundation that we founded in 2013 And I have major programs for you Each of the pillars of that foundation we support the community in three ways It's hunger health and wellness And you said education we have major programs We do through each of those different pillars We also do quarterly grants for nonprofits that apply to us But when something like this happens you have to step back and go okay how can we also give back During that time Obviously our frontline essential workers were specifically hospitals and first responders and all those different avenues they were keeping us going So we came up with different ways We came up with a program called cousins cares which guests were basically able to order a 20 piece party box we would give them a 25% discount and we guaranteed that we would deliver it to whatever Frontline worker They wanted us to within 24 hours So We had the majority of our stores up into that and that program was actually created by one of my franchisees So not all great ideas just come from the marketing guy support center so our franchisee Keith Novotny in westbound and kiosk him here in Wisconsin he started this program on his local Facebook page He's one of our only franchisees that actually Is proactive in doing it We manage all the other ones but he's one of them that's proactive on his own we were observing and then we reached out to Keith and Keith what are you doing Let's talk to sober So then we figured out how to tweak it just a little bit So it could be applied across all the system And then we had about 80% of the system opted into the program and we sold tons of party boxes So people would call up they could anonymously donate the box we would write their name on it And it would be a thank you from that particular guest to what if it was a hospital So if it was a department whatever it was dentist office whatever So we had that program then in partnership with Summerfest here in Milwaukee I built out a landing page on the website where basically we encourage guests to go on and donate dollars And we then committed to basically take all the dollars We got discount our product down I'm trying to remember I think we discounted it down 30 or 40% So for every dollar we had donated to this program we then turned that into food that we were going to buy for Aurora healthcare which is a monster healthcare system here in Milwaukee we ended up being able to feed I think it was for what was it It was around I think we ended up collecting around $5,000 or something like that or more than that and then we were able to feed just tons of frontline workers that program So there was also stuff like that So those were the number of the different things that we tried to do to just try to impact different ways of keeping our name out there Different ways of keeping people aware of what we had to offer and then also when you do those sorts of programs you get that you do then get radio stations and TV stations who are interested in Covering that for you
[00:36:34] Jennifer Kern: [00:36:34] Cause you're entrenched in the community You're doing good work in that community You're entrenched in the local communities they want to air that information and show it to people So that's awesome That's awesome I love that Now is that program still running I'm curious It I did have a bit of a shelf life
[00:36:48] Justin McCoy: [00:36:48] So it did have a shelf life we are no longer doing the party box program I am as I look at 2021 trying to identify like what's that next thing Is it the schools Is it something else where doing our normal work through our foundation we're still meeting as a board quarterly to do grants We're also gonna work to do our typical major programs that we'll do in 2021 But I am having discussions with my PR managers working through and thinking of what could be that next thing for us what could be the next way that we could give back and help the community So that program has done for now But the nice thing about something like building out that landing page for collecting donations and doing all that stuff is that can be repurposed now for another cause So that's the thing too is when we do those things we try to have them be that we can then repurpose them If something else pops up
[00:37:33] Jennifer Kern: [00:37:33] Yeah that's fantastic so many of the guests have talked about these programs I had Jody Boysen from teriyaki madness last week or two weeks ago and she was talking about their pay it forward program as well And it's so great to see how the hospitality industry showed up when I was at such a difficult time but then it also has helped you all stay keep your business on track And it's fantastic stuff And I'd love that the idea came from one of your franchisees Yes Isn't that great When someone comes to us with ideas we're like yes Thank you
[00:38:00] Justin McCoy: [00:38:00] Yeah no it's great And there's a reason he's been our marketer of the year before So
[00:38:04] Jennifer Kern: [00:38:04] There you go There you go
[00:38:06] Justin McCoy: [00:38:06] that's the thing is we at the local level there's many things that can be brought forward that can actually impact the entire system And that's just a prime example of that
[00:38:13] Jennifer Kern: [00:38:13] Yeah and then the third thing you talked about as part of this whole like this minute that the pandemic hit what did you do You talked about communications a lot and I'm a big advocate of just like communicate and over-communicate and you talked about the communications internally within your organization and you talked about communicating externally Can you unpack it a little bit for our listeners What were some of the specific things you did and how did you keep that communication So solid So on-message for what we were going through at the time
[00:38:41] Justin McCoy: [00:38:41] It was very fluid in those first couple of weeks I'll tell you that because most of the communication internal and external has always come from myself and my PR manager But when we were getting into so many things related to applying for loans and the labor impact and state regulation national regulation municipality regulation all those different things it became apparent to us very quickly that probably the best source for that would be Jason Westoff our president I'm working on all the marketing stuff all these different things I'm not able to stay up on what the Wisconsin restaurant association is telling us the national restaurant association So Jason was that pipeline So what we decided is that Jason would be the one point of communication to the entire system So essentially we shut down communication out from anyone else And Jason would send out an email I mean it probably the first several weeks it was almost daily It was okay Here's what's going on Here's what we need to be doing in the store But what would happen is Jason and I and any other department that was pertinent we would coordinate together So if we needed to design materials if we were going to do free delivery if we're going to do whatever I would lay out my piece for him It became almost a newsletter So the system very quickly we communicated that watch for your email from Jason every day So that was the first piece The second piece was we typically we have co-op meetings In-person we have training meetings in person We have franchise advisory council meetings in person We began doing virtual stuff too it was very clear and concise that Jason was going to be the point of contact So they knew that was the email they needed to open We also it was everybody else Send nothing so that it was coming from him And so it was a one stop shop for everything I think that was coming out So that was how we really worked at internally from an external perspective It was from Kate cause on my PR manager she was charged with basically seeking out media opportunities Once the media opportunity would come in Kate and I identify which member of the team whether it was Christine and Jason or I that would handle it And because we were so open we were also getting Subject matter expert requests for like our director of it for our HR team So it literally became where it used to be myself and Christine really talking on a number of different topics out here in the industry whether it was trade national or local to Christie and Jason and I plus a number of our other team members were actually contributing all over the place So she really managed that piece and manage the flow of requests that were coming in But that was absolutely important I would tell you I think the bond we have always had strong bond with our franchisees We have worked very hard when Christine took over as president and CEO and brought us together as a team we wanted to change that vibe It probably wasn't as good as vibe as it could have been And we wanted to change that relationship between the franchisee and us as an executive team And we made tons of end roads over the years and I would say we had a very good working relationship I would say in the last six months They have been so pleased with our communication and our support and the things we've been getting to them to try to get them through this very overwhelming process because we could apply for their loans for them we couldn't do those things but what we try to do is provide as much guidance as possible And in talking with our franchise advisory council we've heard So many great things and just each of us individually getting emails from franchise or franchisees thanking us for the communication and things like that I think it's done nothing but nothing more than bring us closer together even more so than we were before So that communication was really key
[00:41:56] Jennifer Kern: [00:41:56] Yeah It sounds like you're a really tight knit group but especially that one person communicating that's so smart that is so smart as you were talking I was reflecting around how we did it here because like you said like usually it's marketing it's communicating or our ghost write it for the CEO type of thing but keeping that consistency of one person every day so that your franchisees and people in the organization know okay this is the email this is the one thing I got to look at today that's so smart So smart simple focused
[00:42:25] Justin McCoy: [00:42:25] definitely paid off for us
[00:42:27] Jennifer Kern: [00:42:27] Yeah that's great So it would love to know what is your best performing offer right now like in terms of marketing strategy whether it's an LTO or campaign what has produced the best results and you feel like is the most innovative campaign
[00:42:43] Justin McCoy: [00:42:43] I would say that I think the two most impactful things in our business over the last six months have been the introduction of our loyalty program and the continual growth of third party delivery So our average check for a standard pickup online order is double our in store order our average check for a third party online order Is two and a half times So as we have been able to shift people guests to online ordering and to third party delivery we see that they spend more So that's been extremely impactful So I do have TV advertising about our third party delivery program We actively promote the fact that we deliver and it's been hugely impact what we do the second piece is that loyalty program So It took a while for us to get to the point of having a loyalty program because of all those other investments we needed to make we actually decided to invest a POS system for the entire system that was consistent We'd rewired We set up a voiceover IP So we set up the technology infrastructure of every location to be the exact same But once I had that in place now the online ordering provider was integrated there Then I was able to choose a loyalty provider who was integrated with both And that loyalty program the measure of ROI for us has been very strong on that What we're seeing is increased guest frequency We're also seeing increased guests checks bin and I am now able to market on such a more personalized basis than we were before So we're taking that rich data We're taking actual behavior of actual guests and exactly what they're doing And I can segment advertising for this group Okay You're a cheese steak eater and you haven't had cheese steak at our restaurant in four weeks Here's an offer for you Your I guess that just in general it's been 14 days since you visited us We can market to you that way So we are really seeing this loyalty program really starting to work well for us in churn And again with that program as well I have TV advertising radio advertising We're doing things like double points that will throw in here We've now started doing like national food holidays through the loyalty program things like that So loyalty members are Like we had Mac and cheese day a couple however long ago we have a couple of other food holidays coming up here So I'd say those two programs right now have been very effective for us And then in general being in the Midwest we have usually somewhere between three to five National print drops a year and just the standard old coupons they honestly do it people love their coupon around here still and they still are very impactful for us but I'd say those three areas have been what's really driving things right now
[00:45:05] Jennifer Kern: [00:45:05] Okay So delivery is your number one revenue producing is that correct
[00:45:10] Justin McCoy: [00:45:10] I wouldn't say number one revenue producing I'm just saying for sales growth year over year So by adding additional DSPs by continuing to promote it further the convergence that happened because of the pandemic it's certainly been incremental growth is what I'm trying to get at So other traditional programs like we had like prints and things like that we see have a major impact on the business but from an incremental growth perspective loyalty and third party DSPs are now incrementally it's not so much that we're seeing a trade to a different ordering channel we're seeing that they're creating incremental growth which is what we want to see
[00:45:43] Jennifer Kern: [00:45:43] Yeah And what about your most profitable channel What would you say that is
[00:45:47] Justin McCoy: [00:45:47] Most profitable channel I would say that would be
[00:45:50] Jennifer Kern: [00:45:50] dollar for dollar
[00:45:51] Justin McCoy: [00:45:51] dollar for dollar sound surprising but given the average check that we have for third party delivery orders and the fees that I've been able to negotiate on that front I would say that it's probably gotta be pretty close it's taking people from we no longer have as many people calling in keeping a staff member on a phone The order is placed ahead of time is coming in at two and a half times the average check of an in store order And we've gotten the fee structure down to be probably as low as one of our lowest level coupon offers that we put through a print shop so those orders definitely have been very impactful for us
[00:46:24] Jennifer Kern: [00:46:24] Yeah and obviously being able to negotiate those rights I hear some people still paying upwards of 25% 30% for delivery and that's just got to eat into your profit margins Big time
[00:46:34] Justin McCoy: [00:46:34] Yeah So we do have an advantage with the third party DSPs that are integrated with our online ordering provider because it's a different structure So it's not like I'm not accepting order I'm accepting orders through my website from my guests that they just execute So the majority of the fee is really handled by the guests there Versus a commission fee to them because those are get better coming through my website So we focus on that However we do also offer our product on those DSP websites but we Mark up the price on there So it helps to then mute a little bit of the fee structure that you get put in place with those third party DSPs when you're receiving orders from them
[00:47:07] Jennifer Kern: [00:47:07] Yep Okay I want to talk to you about restaurants being reinvented So the name of the podcast is restaurants reinvented and it sounds like you guys have been reinventing yourselves for the better part of the last couple of years by investing in tech And then the way you pivoted so quickly with some really key winning strategies during the pandemic what does restaurants reinvented mean to you today
[00:47:30] Justin McCoy: [00:47:30] For us today that means now becoming more efficient with these different services that helped us get through what we just got through so we were able to introduce curbside quickly we didn't have appropriate curbside signage We were doing like temporary signs and guests were having a call us when they arrived All these different things from a curbside perspective we now are putting in permanent structures Very nice signage And we're in the middle of working with both our online and loyalty provider that when a guest arrives as opposed to having to call us they just have to the button they push that then gives us a signal And makes it more efficient for curbside orders So we're looking at how can we make that process be more efficient from a tech standpoint for a curbside pickup order Another way we're looking to be more efficient is through our drive-throughs So we have a task force that has been looking at drive-throughs We are now installing We're testing high definition headsets We're testing a program that basically yeah it has sensors in the ground Not just when you get to the drive through board but in several spots leading up to it several spots after it we're working at parking cars And this system is then able to time out every step of the process So we're trying to get as efficient as possible in the drive through So again using technology to make these contactless order options be far more efficient and what we're doing and trying to advance them So those are a couple of Yeah those are just a couple of the different things that were looking to do in terms of efficiency we're looking at the third party delivery How can we make it quicker when the third party delivery driver shows up at our store So we're working on putting in shelving which we're a little behind the curve on that simple thing but just figuring out at first we weren't sure if we wanted to have all pickup orders be available on shelving like Panera was doing or did we just want it to be third party pickup at those shelves and different things like that so those are all those sorts of things that we're working on right now
[00:49:17] Jennifer Kern: [00:49:17] Yeah I think you're behind I think that a lot of people are still trying to figure that out what's it look like now when you walk in the store are their shelves are their lockers is it all sitting on a table Do you have to see somebody Justin I could talk to you all day but I know we're coming up on the hour and I'm sure you have other things to do but I would love to wrap with a quick lightning round Is that sound cool
[00:49:34] Justin McCoy: [00:49:34] Sound cool
[00:49:35] Jennifer Kern: [00:49:35] Okay great let's start with ghost and host kitchens What's your prediction
[00:49:40] Justin McCoy: [00:49:40] Well since we have one and we've tried it I do think that there's a place for them I don't know if there's a place for us ours has done Okay But again it happened ironically we introduced it right before the pandemic And what happened is we introduced it in metropolitan Milwaukee right Downtown Milwaukee because this is the perfect spot Pandemic nobody's at the office anymore So a little tricky for us I don't know that we have a full scope of exactly what it could do for us I think in many other cities is going to make a lot of sense I think for new fast casuals coming up to share space reduce costs I could see it working out really well for them but I don't know if it will be for us
[00:50:11] Jennifer Kern: [00:50:11] Okay What advice do you have for marketers today
[00:50:14] Justin McCoy: [00:50:14] Invest in technology always be thinking forward look for new revenue streams We have to constantly be looking for what's the next way that consumers are gonna want to receive our product And as we talked about earlier in the podcast us thinking forward with some of that stuff or at least maybe not being well-advanced beyond anyone else but being aggressive with it really helped us out a lot And I will be continuing to look for opportunities Do that moving forward
[00:50:35] Jennifer Kern: [00:50:35] The biggest challenge that you're facing today
[00:50:38] Justin McCoy: [00:50:38] Biggest challenge we're facing today It tends to always be labor just high quality labor So we're constantly looking at how to recruit and retain just talented It's a very competitive space out there I will say I think it's been I don't want to say relieved I would just say I think the talent pool has increased a little bit because of closures but having high quality staff in place to execute what we're looking to do and at the speed that we're looking to do it and at the increased volumes that we're seeing in our stores is always a challenge
[00:51:02] Jennifer Kern: [00:51:02] as a marketing executive what keeps you up at night
[00:51:05] Justin McCoy: [00:51:05] continuing to get people through the sales coming in and transactions happening it's always on my mind in many ways when things are going well no one's talking to you and when things aren't going well and you're going to hear about it that's the thing that is always on my mind And I would say probably that second piece of that is what's the next thing is constantly what's the next thing And how do we keep evolving to make sure that we're at the forefront of what we're doing and that we will always be top of mind for potential guests out there
[00:51:30] Jennifer Kern: [00:51:30] and what's the biggest opportunity right now in this space
[00:51:34] Justin McCoy: [00:51:34] for us or in the space in general
[00:51:35] Jennifer Kern: [00:51:35] just for restaurants and marketing Biggest opportunity We should be seizing
[00:51:40] Justin McCoy: [00:51:40] Yeah I think it's truly identifying those alternative channels for people to get your product. And that's different for everyone. I have a different circumstance than what you have on DCs and what they have out in California. So what they're going to have in New York, the restrictions in New York, you will going to have winter weather coming.
[00:51:55] so it's going to be, how do we keep evolving with this environment that has such an unknown? And so we're going to have to be really innovative and staying relevant and continuing to try to serve guests and there's things that are out of our control. There's some things that are in our control and it's a balancing act and, it's going to be a challenge.
[00:52:12] Jennifer Kern: [00:52:12] Yeah, life is a balance for sure. Well, Justin, thank you so much. It's been really fun. Hearing all the insights and you sharing your experience and strength that they're, that you're having a cousins and just really appreciate your time today. So thanks for stopping by restaurants reinvented. I hope you have a great day and enjoy that pepperoni sub, which sounds amazing.
[00:52:32] Justin McCoy: [00:52:32] I might order one day. Thank you for having me, Jen.
[00:52:34]