Anne Beiler want to support her husband’s business by selling some homemade goods at the local food market. I guess it worked.
Dave Young:
Welcome to The Empire Builders Podcast, teaching business owners the not-so-secret techniques that took famous businesses from mom and pop to major brands. Stephen Semple is a marketing consultant, story collector, and storyteller. I’m Stephen’s sidekick and business partner, Dave Young. Before we get into today’s episode, a word from our sponsor, which is, well, it’s us, but we’re highlighting ads we’ve written and produced for our clients so here’s one of those.
[Seaside Plumbing Ad]
Dave Young:
Welcome to The Empire Builders Podcast. Dave Young here with Stephen Semple and he whispered the topic in my ear and I don’t really have a clue. Auntie Anne’s-
Stephen Semple: Pennsylvania
Really?
Dave Young:
Yeah, I know.
Stephen Semple:
Pretzels.
Dave Young:
Remember, I don’t get around much. Auntie Anne’s pretzels. Yeah. And so I have an Auntie Anne.
Stephen Semple:
Oh, There you go.
Dave Young:
She’s my oldest living relative right now, and I like pretzels. So take it away.
Stephen Semple:
Anti-Anne’s is pretty big. They have like 2000 locations, 40 states, 26 countries. They do like 800 million in sales. It’s a bit of a deal. And it’s very homespun in terms of the branding, the showmanship, even the products. And some people consider the founder, Anne Beiler, to be kind of like the first lady of the American food court. Although I don’t know whether that’s really accurate, because we’ve had some other women entrepreneurs who are pretty early on in it.
Dave Young:
But this is primarily like mall food, food court kind of fare.
Stephen Semple:
Yes. Yes.
Dave Young:
Yeah.
Stephen Semple:
And in 1992 and in 1994, she was named Inc. Magazine’s Entrepreneur of the Year.
Dave Young:
All right.
Stephen Semple:
So pretty big deal. And the interesting thing is she was a stay-at-home mom with Amish roots from rural Pennsylvania.
Dave Young:
Oh, really? Okay.
Stephen Semple:
Yeah. And what she wanted to do was support her husband’s counseling service. And so, she borrowed $6,000, and she took an empty stall at a local food market, and she was selling drinks and pizzas and these soft pretzels. And really these soft pretzels came from, it was a regional taste that came basically from Pennsylvania’s German heritage. The big soft pretzel is kind of a German, is a German thing.
Dave Young:
Sure
Stephen Semple:
because it goes great with beer.
Dave Young:
Yeah. I concur.
Stephen Semple:
Yeah. And these soft pretzels, basically you can date them back to the sixth or seventh century in Central Europe, but they remain mostly regional until kind of like the late ’80s, here in North America. Here’s the thing. That was really great about the pretzels that she was selling. She can make them for about seven cents, in terms of the ingredients, and she was selling them for 55 cents.
Dave Young:
Nice.
Stephen Semple:
Right. But standing out and figuring out how to display them and whatnot really became the challenge. And she sought to upgrade them, and what she wanted to do was do something beyond kind of that German heritage. And she started doing things like adding sugar and baking powder and more butter. And ultimately she found this way to make them these really buttery, fluffy, decadent, slightly salty, slightly sweet pretzel. So it suddenly evolved away from that German heritage.
When she got that recipe right, sales surged. She had a weekend where she sold like $2,000 out of this little stall at a farmer’s market of just the pretzels.
Dave Young:
That’s amazing.
Stephen Semple:
Yeah. So then she decided, okay, I’m going to lean into the pretzels. Let’s just do the pretzels. Let’s get rid of everything else, do the pretzels. But what I want to do is kind of create this warm, familiar identity. Dave, you often talk about naming things, right? And that’s when she decided, I’m going to call it Auntie Anne’s, because you know what everybody has?
Dave Young:
An Auntie Anne.
Stephen Semple:
An Auntie Anne.
Dave Young:
Yeah, we do.
Stephen Semple:
Yeah. It also echoed how her 30 nieces and nephews addressed her. They all addressed her as Auntie Anne.
Dave Young:
I love that. Yeah.
Stephen Semple:
Yeah. So initially she was just doing things in farmer’s markets and then she decided to move into a mall. She thought, okay. She moved into the mall. This was suggested to her by a church friend and it was met with skepticism. She actually had a really hard time getting into a mall. Mall manager really doubted that this single item pretzel stand could cover the rent, and he dismissed the concept.
He said, “No way.” But she was pretty determined. She proposed an upfront short term agreement, where she would basically do a three-month lease. “I’ll pay the money upfront. You can kick me out at the end of three months.”
So it’s November 1989 and Auntie Anne’s opened some Park City Center in Lancaster. And basically,, they showcase live pretzel twisting and there’s the aroma. So people are seeing people twist the pretzels and they have this really great way that they displayed them and whatnot.
Dave Young:
Kind of flip them up in the air and let them land, and you do the little knot thing.
Stephen Semple:
And it was a hit within two years, like so much of a hit, within two years there were a hundred Auntie Anne locations and malls across America.
Dave Young:
No, that’s fantastic.
Stephen Semple:
Now here’s the part that I loved. This on skeptical mall manager, his name’s Monte Zanko, eventually became a franchisee.
Dave Young:
I don’t think this will work. Now I’m interested. Yeah.
Stephen Semple:
That was probably my favorite part of the whole story. But what I found that was cool about this is, she’s got her farmer’s market thing and she’s selling all sorts of stuff. And what she noticed was, the thing that really made money and sold really well was the pretzels. And then went back and said, “Okay, how do I improve on the pretzels?” Kept working on improving on pretzels and then they really sold like crazy.
And if you think about it, this was around the same time that Cinnabon was coming out. So this idea of being able to survive in a mall with a single product was a pretty innovative idea.
Dave Young:
That’s really cool because that’s not easy. Mall stores, man, unless you have something that’s proven, and you’re going to have to prove it somewhere, she did it there.
Stephen Semple:
She did it there. And also there’s the whole, showing it being made like it’s that-
Dave Young:
You’re making an experience, right? It’s not like somebody just reaches under the counter and pulls out a pretzel.
Stephen Semple:
And again-
Dave Young:
There’s a show going on.
Stephen Semple:
Yes. And today that’s a little bit more common, because we’ve got restaurants where there’s seating in the kitchen and things along that line. But in the late ’80s, that wasn’t. And it’s interesting. I attend a course called the Strategic Coach. It’s a quarterly coaching program. It’s created by Dan Sullivan. And one of the things Dan talks about is businesses have a front stage and they have a backstage. So the front stage is the customer experience. What’s the customer see? The backstage, all the support things.
And he’s often talking about one of the clever things you can do is, how do you bring elements of your backstage into your front stage so it becomes part of the customer experience.
Dave Young:
Stay tuned. We’re going to wrap up this story, and tell you how to apply this lesson to your business right after this.
[Using Stories To Sell]
Dave Young:
Let’s pick up our story where we left off and trust me you haven’t missed a thing.
Stephen Semple:
So the front stage is the customer experience. What’s the customer seeing backstage to all the support things? And he’s often talking about one of the clever things you can do is, how do you bring elements of your backstage into your front stage so it becomes part of the customer experience.
Now when you do it, you’ve got to add the showmanship. If you’re a pizza place, the person’s got to throw the dough in the air, even if that’s not really the way you do it anymore. If it’s food being chopped, like I love watching these YouTube videos today of these Japanese bartenders who are doing the stuff with the knife and things like that [inaudible 00:10:23].
Dave Young:
Oh, yeah. You could have Benihanas or something. Yeah.
Stephen Semple:
Oh, it’s incredible to watch. So she was, from what I can tell from research, she was like one of the very first because Benihana was just coming on this scene. She was one of the first to embrace this idea of let’s show people how this is being done, which then draws a crowd and also makes people more interested in the product.
Dave Young:
Well, here’s the thing. It gives us a little story to tell.
Stephen Semple:
Yeah.
Dave Young:
Right? I watched them do… You’re going to go tell people that you watched them make these pretzels.
Stephen Semple:
Oh, next time we’re in the mall, Dave, let’s go by and check it out, right?
Dave Young:
I’m thinking to myself, okay, you said this is going to be kind of a short episode, but I think we can go someplace with this. Okay?
Stephen Semple:
Yep.
Dave Young:
What’s the best pretzel you ever had? Tell me about the best pretzel you ever had.
Stephen Semple:
Christmas, 1999, Germany.
Dave Young:
Okay. See, so here’s the thing. That’s the perfect answer.
Stephen Semple:
Literally at a Christmas thing in Germany, drinking.
Dave Young:
Here’s why that’s the perfect answer. It’s because there’s a context to it, that it wasn’t at a mall.
Stephen Semple:
No.
Dave Young:
Right. It wasn’t one of those. But you can go to the mall and get a pretzel, and relive that Christmas.
Stephen Semple:
Yes.
Dave Young:
In your mind, you can go, oh, this tastes almost like the one… It’s not quite as good. It’s almost like one.
Stephen Semple:
Actually not 1999, 2001. Sorry. But, yeah.
Dave Young:
I equate that to, in the Whiskey Vault at the Whiskey Marketing School at Wizard Academy, you and I wrote songs. And some of you like to talk about all the tastes and weird tasting notes and smelling notes that you get in the whiskey. And for me, it’s always about the story. This is the whiskey that my dad drank, or this is the whiskey that Steve and I shared in Florence, except he’s not taking me to Florence.
But I’m saying we could have that memory, but it comes back to the context around the product, or the drink, or the pretzel. And if you can do something that makes somebody remember it. And if you can’t, then you give them the little story, the front of the room, the front stage, the main stage. Is that what did you call it?
Stephen Semple:
Well, it’s front stage and backstage. You don’t think about it.
Dave Young:
The front stage and backstage.
Stephen Semple:
And where this came from, Dan is Dan had a theater background, right?
Dave Young:
Oh yeah.
Stephen Semple:
As a producer, you’re sort of familiar with front stage, backstage, but it’s this whole idea of sometimes consciously, consciously bring that backstage into the front stage. And look, we can do it easier than ever before, because I talked to a lot of my clients about social media postings. You’re repairing the roof to the RV, show it being torn apart and rebuilt, and what you’re doing. That’s bringing your backstage into your front stage and people find that stuff interesting.
Dave Young:
May I share another one?
Stephen Semple:
Sure.
Dave Young:
This is something we’re actually doing at Wizard Academy.
Stephen Semple:
Because these are great ideas for people to think about. Dan believes every business has this opportunity to do this. It’s one of the things that they teach. So anyway, please, please. Yes.
Dave Young:
So when’s the first time you went to Wizard Academy? Your very first trip.
Stephen Semple:
I can’t remember the year. It’s funny. I always forget what… I’m terrible at remembering years, but I remember the first time stepping on campus. Absolutely.
Dave Young:
Yeah. And so we have that in our records.
Stephen Semple:
Yes.
Dave Young:
All right. And can you name all the times in between?
Stephen Semple:
No.
Dave Young:
And, we have that in our records.
Stephen Semple:
Yes.
Dave Young:
Our front stage experience that brings the backstage in, and this is something we just started doing. In fact, I haven’t even worked out really the… It could be time-consuming with the middle to large group is we’ve actually created Wizard Academy Passports. And you get to stamp your passport with all the times you’ve been for each different class, and then we’ll date them and sign them in front of you like you’re at, not the TSA, but the customs office or something.
And we make a little ceremony out of it, and celebrate all the times you’ve been. And if it’s your first time, you get your passport, and you get to stamp it and now you take it with you and you’re looking forward to the next one.
Stephen Semple:
Well, and the thing that’s interesting about that is it makes it also a tactile experience.
Dave Young:
Oh, absolutely. Yeah. I’ve got a little Kodak printer. So we take a picture of you. It doesn’t have to be a serious picture like a regular passport.
Stephen Semple:
So one of the things that they don’t do this any longer at the Strategic Coach, what they used to do. So again, talking about tactile experiences and things along that lines, is they had a visioning exercise that they would do and what they would actually do in that moment that they would start the visioning exercise, they would start popping popcorn. Because the whole exercise, like you’re supposed to envision being in a movie theater, watching a movie of your life and things along that lines. Well, nothing brings somebody back to a movie theater than-
Dave Young:
The smell.
Stephen Semple:
The smell of Popping popcorn.
Dave Young:
Yeah, exactly.
Stephen Semple:
Right? But again, it was like… Now that’s not backstage/ front stage. That’s more like sent recalls and things along that lines. But I just want to add this. This is probably the most important message from all of this. Way too many businesses think what they should do is extend the number of products that they sell. It’s actually easier to become famous for one thing. It’s harder to become famous for many things.
And the number of businesses out there, like big businesses, that have tried to extend their brand and have it fail is incredible. So this narrow focus, while initially everybody thought, “That’s crazy,” actually was their success because she could become famous for one thing, the best pretzels.
Dave Young:
Right. Yeah. I love it. I love it. I’m glad Auntie Anne has seen such wild success. Is it a franchise or is it-
Stephen Semple:
It is a franchise.
Dave Young:
Okay.
Stephen Semple:
Yep. It’s a franchise. And as I said, they’ve now got like 2000 of them.
Dave Young:
So you, too, can be Auntie Anne.
Stephen Semple:
That’s true. You can. You can.
Dave Young:
Okay. All right. Well, thanks for the Auntie Anne pretzel story. I’m getting kind of hungry sitting here.
Stephen Semple:
Yeah. There you go.
Dave Young:
We’ll see you next time.
Stephen Semple:
All right. And pretzels go great with beer. They go great with beer.
Dave Young:
Sure. Sure they do. Why wouldn’t we? It’s almost 8:30 in the morning.
Stephen Semple:
There you are.
Dave Young:
That sounds like a great breakfast.
Stephen Semple:
Breakfast of champions.
Dave Young:
Pretzels and beer. Thanks, Stephen.
Stephen Semple:
Great. Thanks, David.
Dave Young:
Thanks for listening to the podcast. Please share us. Subscribe on your favorite podcast app, and leave us a big fat, juicy five star rating and review at Apple Podcasts. And if you’d like to schedule your own 90-minute Empire Building session, you can do it at empirebuildingprogram.com.
