Local franchises can use their “Australianism” as a novelty factor when entering new markets, a franchising expert says, but must evolve their brand in order to be successful in the long-term.
Jason Gehrke, director of the Franchise Advisory Centre, says Australian franchises looking to expand overseas should tap into their Australianism “to the extent to which your brand permits”.
“[There are] businesses that are selling Australia as much as they are selling the product, and that becomes part of their appeal… They play on the stereotypical perceptions of Australia,” he says.
“Some brands are built around that kind of thing. They’re really focused on the Australian factor… However, the novelty factor alone is not enough to make a brand successful.”
Gehrke’s comments come on the back of the success of Australian pie franchise Pie Face, which recently opened its first store in New York, located on New York’s iconic Broadway.
It’s understood the store attracts long lines of customers queuing for gourmet pies. Ten more Pie Face stores are planned to open in the city by the end of the year.
“We’re doing much better business in this store than in any of our 70 stores in Australia,” Pie Face co-founder Wayne Homschek told Inside Retail.
Gehrke says while Pie Face is selling an iconic Australian food – the meat pie – it isn’t dumbing down its image by relying on Australian paraphernalia such as Akubras and crocodiles.
According to Gehrke, there are three main reasons for Pie Face’s success in the US:
1. American founder
“Wayne Homschek is an American. He was there until about 20 years ago, so he has an understanding of the US market,” Gehrke says.
“He is also a former investment banker, so he not only has local cultural knowledge but local business knowledge. That’s got to be an advantage in anyone’s books.”
“That first advantage would have led to a second advantage, which was site selection.”
2. Location, location
The first US store opened on Australia Day and it opened on Broadway on a really, really busy corner, so it has two-street frontage.”
“Fifty metres down the road are the doors of the studio in which the The Late Show is recorded and broadcast all over the world.”
3. Public endorsement
“[The Late Show host] David Letterman is an American institution and somehow these guys [at Pie Face] managed to get coverage on his show.”
“Money can’t buy that kind of publicity. That’s an incredible wave that you can surf for some time.”
“It goes great things for the public perception of the brand, and also generates interest among potential franchisees and investors.”
“It would have been hard to get this kind of coverage had the location not been so prime.”