In one of the busiest commercial spaces in the heart of Toronto's financial district, Andrew Applebaum wants to be the first face hungry people see every morning.
The 38-year-old owns and operates The Cereal Bar, located in the food court of Commerce Court at the corner of Bay and King streets. His hungry customers mix and match 25 different cereals, 25 toppings, four varieties of yogurt and nine kinds of milk.
"You can eat cereal every day, because you can have it hot, you can have it cold, you can have it with yogurt, you can have it with milk," Mr. Applebaum says.
In the early morning, the spot is a perfect match for the busy professional crowd of what Mr. Applebaum calls "Type A personalities, always on the go" bustling beneath Bay Street.
(Yvonne Berg)
But when afternoon arrives (The Cereal Bar remains open until 3 p.m.), customers stop coming.
Mr. Applebaum averaged 120 customers a day when The Cereal Bar opened in July, 2006, and has seen that number grow month to month to reach its current daily average of 200. Yet three quarters of that number line up at The Cereal Bar before 11 a.m.
The location offers plenty of potential for business. Roughly 30,000 people pass through Commerce Court each day and 10,000 walk directly past The Cereal Bar. That means his business, despite its continued growth, reaches just 2 per cent of its potential customer base.
Mr. Applebaum knows he could better challenge his competition if he found more afternoon business.
"We're already paying rent, we're already paying labour, and we have to be open in the afternoon, so we might as well make some sales," he says.
He's searching for a new hook, and he's already started the brainstorming process.
Lease restrictions prevent him from offering sandwiches or smoothies, but he's now offering toppings for the frozen yogurt. He's also considering an attempt to co-brand, citing the Tim Hortons/Wendy's venture as a great model to follow. Another feasible opportunity is catering meetings in the office buildings above.
If The Cereal Bar doesn't alter its menu or partner with a corporate giant, it could expand instead. Mr. Applebaum says there's potential to open half a dozen additional Cereal Bars in the financial district's underground food courts.
What the experts say
Andy Macaulay is president of Zig, a leading North American communications company that helps businesses rethink their strategies. He doesn't think anyone can change the fact that people associate cereal with breakfast.
"People have established frames of reference for the things that fit into their lives," Mr. Macaulay says.
" 'Cereal equals breakfast' is one of them, unless you're a 20-year-old university student, for whom the equation is 'cereal equals cheap, decent, convenient food.' But you often can't take the equation of one target audience and make it fit another."
Mr. Macaulay says the next step is to reframe cereal by first reducing it to its base appeal, then building it up as something more than breakfast.
"Cereal equals grains. Grains are heroic in our diet. Grains are an all-day food," Mr. Macaulay says.
"The Cereal Bar as a brand has the strength of suggesting the usage occasion by virtue of using the word 'cereal,' but therein lies the problem. We want more emotional real estate for Andrew's business. So dare we rebrand it as 'Grains to Go,' and assume that the hoards that pass by in the morning will understand that means cereal at breakfast? Given they go by every day, we're betting yes."
Mr. Applebaum could then customize the grain offerings "for each consumption occasion," including snack-type grains and grains more associated with lunch foods, Mr. Macaulay says.
John Pliniussen, a professor of sales, e-marketing and innovation at the Queen's University School of Business, suggests highlighting cereal's health benefits. He'd start by enlisting nutritionists and focus groups to determine all the health benefits of cereal.
"Let's say I didn't have cereal in the morning, but let's say I'm having a busy day and I know that if I have this 'über-snack,' it will provide me with 90 per cent of the carbs I need and 80 per cent of the protein I need," Prof. Pliniussen says. "Who wouldn't want that? Especially on Bay Street?"
Though rebranding cereal could attract new customers, Mr. Macaulay stresses the importance and cost-effectiveness of retaining and satisfying the existing customer base.
To keep those customers, Mr. Macaulay believes The Cereal Bar should focus on high-quality service instead of gimmicks or promotions.
"My favourite quote is attributed to Dick Currie, who reputedly evaluated a loyalty program for Loblaws many years ago and said, 'I don't want to put handcuffs on our customers,' " Mr. Macaulay says. "What he meant was that artificially creating loyalty through incentives was less powerful than earning the customer's business every day through a better customer experience. If Andrew creates evangelist customers, they'll create others through word of mouth. And the medium is the in-store experience, not outreach."
As for co-branding, Prof. Pliniussen says The Cereal Bar would benefit most by "not partnering with another food outlet, but partnering with another organization that embraces good food and good nutrition." He lists Goodlife Fitness and the YMCA as examples.
As an alternative, Mr. Applebaum could target professional companies - law firms or accounting firms, for example. The Cereal Bar would be an appealing service for those who work long hours and need food on the go, Prof. Pliniussen says.
In a nutshell
Rebrand
Cereal has been around forever, and convincing people not to associate it solely with breakfast is a tall order. Instead, use a word customers can connect to any meal: grains. People are more likely to grab a bowl at lunch if they know it will fill them up and keep their calorie counts low. Retain
Maintaining the existing customer base through quality services instead of cheap promotions is paramount - happy customers will spread positive word of mouth and attract new business.
Get a spotter
Instead of rival food outlets, seek partnerships with fitness-oriented businesses to further promote cereal's health benefits.Expand
If it's feasible, expand to more locations. The market of busy professionals exists in every big city.
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