This story first appeared in issue296 of the MARKETING Weekender
George Ang was a delivery boy at Pizza Hut during his student days and worked his way up to front of house crew.
This was when he learned how fast-food chains worked so efficiently even without a culinary expert present in the kitchen at all.
Now, George is a successful entrepreneur who owns Inter Mark resources; founded the regional F&B group, Revenue Valley; his own restaurant chain, The Manhattan Fish Market and more than 100 other restaurants under Revenue Valley including Tony Roma’s and New York Steak Shack.
When he acquired Malaysia’s oldest fast food chain, A&W, he was not oblivious to the fact that the brand is seen as outdated and unsuccessful when compared to other fast-food names, but George chooses to place emphasis on the consumer affinity tied to the iconic 56-year-old chain….
What prompted the decision for Inter Mark Resources Sdn. Bhd. to take-up the entire interest in A&W Malaysia back in September 2018?
We saw a sizzling opportunity to take ownership of a fast-food brand that had strong brand equity with timeless core products such as Coneys, RB (Rootbeer) and Waffles. There are not too many F&B brands in Malaysia that can scale up and grow in excess of 100 profitable stores and A&W is one of them.
As the oldest fast-food brand in the country, what have you done to revitalise the brand in the short space of two years?
A&W has always carried terrific core products but was sometimes inconsistent in its user execution. We first had to ensure that our guests received consistent, great products. Examples of this included when we first took over, the Rootbeer (RB) for dine-in was occasionally served in a room temperature mug instead of a frozen one. Why? A lot of the mug freezers were not working or A&W colleagues did not bother to ensure we serve them in cold frozen mugs. As simple as it sounds, the first order of business was to get all the freezers fixed and ensured our team served guests in frozen mugs – no excuses!
The other product that we quickly improved was the fried chicken. A&W used to be famed for its Golden Aroma Fried Chicken but over the years, the product was neglected and I was surprised that when we first took-over, we were using frozen instead of fresh chicken. We now use fresh chicken, and although it costs us a bit more, we see a lot of guests coming back and saying great things about our Golden Aroma Fried Chicken.
After looking at the core menu items, the next thing we did was to look into improving the ambience. Some people may still say A&W looks like a tired brand and store. So we worked on a new store design that incorporated retro-style with the modern comfort of an American diner. The first restaurant that incorporated this state-of-the-art new interior design was at Seventeen Mall in PJ. It worked very well and a lot of guests started talking about the look and feel. We even had one of the biggest QSR players in the country replicate our idea by building a retro unit a year later.
After the product and store design, the third piece of the puzzle we are working on currently is to improve our ‘service’ or ‘hospitality’. How can we make our guests feel like we are there to really make them happy and not just provide a meal. We look forward to rolling out some rather innovative plans in the coming months that further propels our connection with consumers.
Largely perceived as a traditional and heritage brand, how do you aim to target a new, younger audience to embrace A&W so warmly as some of the older generation once did?
The young ones are more technologically savvy, more social media savvy and possibly less loyal, in general. When we first took-over at end 2018, all transactions at A&W outlets accepted cash only. We invested and inserted credit card machines, allowing payments via e-wallets, and started delivery and online sales.
We also reverted back to the ‘roots’ of being fun and a little cheeky by using Rooty (the A&W bear) in more social media postings and chat postings. We created Rooty ‘emojis’ where our guests and friends can engage with the brand in a fun way.
The pandemic has generally been negative but also positive in another way. Our online sales increased by a large percentage and a lot of new users who are much younger tasted A&W for the first time via online orders.
Your retro concept store at Seventeen Mall created quite a stir when it was unveiled becoming an Instragrammer’s haven.
Yes, the retro looking stores have been a hit since Seventeen Mall opened. The traditional QSR chain SOP was to standardise every store look and feel. A&W, thankfully, does not need to follow these regimented guidelines. We believe we can create store designs to suit the location and occasion – a customised approach on delivering to individual demographics and cultures depending on location.
For example, we wanted to ensure that the Sunway Pyramid store looked and felt more like an American diner for young kids as there is a large student population in the area. For a potentially higher-end store location, we will tweak to make the store a bit more ‘premium’ creating an environment where people can have quiet conversations or discussions. We remain creative at the front of house yet mindful of having a consistent operational process and flow for back of house.
How has A&W navigated the of pandemic and how have you maintained a connection with your audience?
The pandemic and the lockdowns from MCO 1.0 to now MCO 3.0 (or is it 4.0) has definitely hurt the economy specifically the retail and restaurant industries. The first thing we focussed on when the first lockdown hit was to devise creative methodologies on how we could keep our cashflow positive so we can be sustainable as a company throughout the crisis. Three key things we focussed on…
How can we increase sales? We looked at new sales channels especially when ‘dine-in’ was not allowed during lockdowns. We worked closely with a few aggregators to see how we could quickly increase delivery sales. We started ‘Park and Pick up’ services in stores that allowed for that so our guests could stay in their cars. Currently we are also in the midst of building our own A&W app for delivery, pick-up and even dine-in.
How can we contain or reduce expenses? We worked with our landlords for win-win rental arrangements like rental costs based on sales, we managed our operating hours differently based on the store sales (e.g., stores on the PLUS highway were reduced to one shift as sales slowed down due to the ban on interstate travel) and we cut and controlled fixed expenses at the head office level.
How can we cut losses on certain stores? We closed and relocated quite a few stores last year as we felt that these were stores that would continue to bleed even when the crisis was over. We moved them to better locations and most of the relocated stores are now doing much better.
Despite the pandemic (now into its 2nd year), one of the things we have not done is cut marketing programmes. We continue to launch new products to keep engagement high with our current and new users. In fact, our culinary team continues to be very busy coming up with new products or improving current products. In the QSR space, it is important to keep engagement strong so that our guests see a reason to keep coming back. How do we keep engagement strong? Ignite their cravings for our core products and provide them with continual variety and choice.
You recently assisted in providing A&W lunches to front liners at Sungai Buloh Hospital, what inspired this?
We exist because of our community. Our community means the people who work for us, talk about us, consume our products and help get our products to our guests. Last year we did a number of programs such as giving meals to delivery riders that helped get our products to the end consumers when ‘dine-in’ was banned. We also did a program where we allowed our colleagues to send meals to their front liner friends. Our Sungai Buloh store is one of our newest store and it has been doing very well despite opening in the midst of an MCO. We have a great team there and they were more than happy to contribute and engage with the front liners.
Any insights you can share about the brand revival journey?
I don’t believe there have been any earthshattering new management philosophies that I have adopted but rather get things back-to-basics and build from there. The QSR industry is not rocket science. It’s more about doing the simple things each shift so that we ensure our guests are happy.
What I have implemented is to strategically place the right leaders in the right place, keeping them engaged and focussed, and also constantly learning from each other. There are many colleagues that have been in the company for more than two decades and they know the brand better than me. My job is to make sure they bring 100% of what they know and what they can do, to the table.
Tell us more about your online commerce moves
Besides aggressively entering into cashless ordering, we are in the midst of building Self Order Kiosks in some stores and also building our own proprietary App that will cover all sales channels from dine-in to delivery. In the future, it should be as easy as pressing just one or two keys on your phone to get an A&W Mozza Burger straight to you. It should be fast, seamless and super convenient.
Our intention is to bring convenience, craving and choice to our consumers. To do this, we will build more stores that are easily accessible across different parts of the country. In the next two years, we are focussing on building more ‘drive-thru’ stores and also what we call DDT stores (Dine, Delivery & Takeout) in shop lots that are convenient for our guests. Our vision is not to be the biggest fast-food chain in Malaysia but to be the chain that consumers crave for the most.