Zoe’s Kitchen wants diners to know Mediterranean food doesn’t always have to come from Greece. You can find plenty of other influences on the chain’s menu.
Fast-casual purveyor Zoe’s Kitchen (ZOES), which has been publicly traded for a little over a year, is one of many newly public restaurant chains looking to expand across the U.S. Using a business model that has been popularized by larger rivals Chipotle (CMG) and Panera (PNRA).
The chain is reporting some early success. Annual sales totaled $171.7 million for 2014, up 48% from the prior year. Analysts expect that figure to soar to nearly $439 million by 2018. Zoe’s operated 132 restaurants across 15 states at the end of last year but it sees potential to one day operate 1,600 locations across the U.S. Like many newly public restaurant chains, including Shake Shack (SHAK) and Bojangles (BOJA), Zoe’s is essentially a regional player that wants to go national. It mostly operates in the Southeast.
But Zoe’s must confront a few perception issues first. Executives say when diners hear the word “Mediterranean,” they think the food has to be Greek. But that isn’t the case.
“Everyone goes right to Greece,” Zoe’s Chief Executive Kevin Miles told Coins2Day. Diners come into Zoe’s expecting to find baba ghanoush and falafel on the menu, but those items aren’t sold there. Instead, Zoe’s makes hummus, pita sandwiches, salads, and kabobs, menu items with arguably more mass appeal.
Miles said that misconception “truly is our biggest challenge.” Zoe’s operates based on the premise that 21 countries can be considered Mediterranean and thus the restaurant chain has a lot of room to play around with other cuisines, including those from Italy, Spain, and France.
At the same time, over half of Americans either have misconceptions about what Mediterranean food is or are completely unsure of how to define the cuisine. Case in point: only 5% of Americans were aware that Mediterranean food comes from 21 countries, according to a study Zoe’s commissioned.
Rachel Phillips-Luther, vice president of brand marketing at Zoe’s, believes that education about the cuisine can be a conversation starter with diners. “There is an opportunity to bring unique experiences and flavors to the fast-casual consumer as we evolve the menu,” she says.
That involves moving away from the menu originally conceived by founder Zoë Cassimus nearly two decades ago. Zoe’s recently added a few new hummus options but also pulled egg salad and tuna salad, which were menu items that the chain had sold since it opened its first restaurant. Cassimus and the rest of the founding family members are no longer involved in the management of the business.
“The philosophy will remain the same,” said Phillips-Luther. “Lean proteins, abundance of fruits, and vegetables and olive oil.”
