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TCBY Sweetens its Value Proposition

The grande dame of the red-hot fro-yo space leverages a vibrant new look, a new self-serve format and product innovation to become fresh and compelling again.

A wave wall that showcases the company’s redesigned, more contemporary logo has become an iconic interior feature for TCBY.As trends go, it doesn't get much hotter than frozen yogurt. Growth in the category has been explosive, and the flurry of new store openings, new franchise agreements and new players entering the space shows no signs of slowing. Technomic data shows that from 2010 to 2011, 4 of the top 10 fastest-growing chains in the restaurant industry, including the top 2, were frozen yogurt concepts – all newcomers launched since 2007. But The Country's Best Yogurt – better known as TCBY – was there first.

Founded in Little Rock, Ark., in 1981, TCBY was the first to bring frozen yogurt into the foodservice arena and take it national with a franchised business model. It grew early and fast – at one point ballooning to more than 3,000 units – but in recent years lost its luster and, like many legacy brands, may have suffered from complacency. TCBY scaled back significantly and worked to adjust to the new realities of its increasingly competitive market segment.

Today, as part of Famous Brands International (also parent to Mrs. Fields), TCBY has more than 450 U.S. stores and 200 international units, and is back in growth mode. The company reported strong results for 2012, a year that saw the first positive franchise store growth in more than 12 years. And TCBY is heading into what Tim Casey, who departed as CEO in early February, predicted will be a "banner year" for growth.

That's thanks to recent moves made to update the chain's image, broaden its consumer appeal and expand its options for franchisees – all done during Casey's three-year tenure. "About two and a half years ago we did some great things for the brand," he told FE&S, just prior to his departure. "We did rebranding work, we changed the brand equity guide, we contemporized the brand. We also introduced our self-serve platform, which has enjoyed explosive growth with our franchisees."

That platform brings the TCBY experience more in line with how most of its new competitors have come to market. According to IBIS World Research, self-service now accounts for more than 20 percent of the frozen yogurt market, and Casey concedes that self-serve is "where it's at" right now in terms of development. Less than three years out of the gate with the new prototype, the chain has more than 175 self-serve stores operating.

Casey notes that, while franchisees can choose full-service or self-service models, most new stores will be self-service. He declined to provide specific unit growth targets for 2013 beyond noting that growth will be robust. Target markets lie primarily in regions east of the Mississippi River. The company recently announced plans for significant growth in the Boston market, as well as four major North Carolina cities and Houston.

Redefining the Guest Experience

Consistent in size and real estate type with traditional full-service TCBY locations, the new self-serve stores average 1,200 to 1,400 square feet and are ideally located in retail centers with high foot traffic generated by strong co-tenants. Convenient parking is another big driver, as is good visibility. "Our real estate team does a good job of supporting our franchisees in scouting those types of locations so that they can be successful right out of the gate," Casey says. "The success factors we look for haven't changed, but we think we're a little more scientific about site selection now than in the past."

What's not consistent with traditional units, beyond the self-service aspect, is the look and feel of the new stores. The new TCBY is decidedly more design-forward – sharply focused on giving customers a contemporary, customizable and comfortable experience. Vibrant pops of blue, green, orange, yellow and magenta create a bright and energetic environment. A so-called wave wall that showcases the company's redesigned, more contemporary logo has become an iconic interior feature. Messages that graphically play on the TCBY acronym decorate the walls: "tasty, creamy, blissful yogurt," "totally cold & bold yogurt," "truly can't beat yogurt."

Each location offers 10 to 18 yogurt flavors accessible from self-serve dispensers flanked by glass walls. Guests can mix, match and swirl as much as they want before moving on to a topping bar. After choosing from among a minimum of 27 and up to 38 toppings, depending on the store, they weigh and pay for their finished creations at the cashier station.

The toppings bar features everything from healthful fresh fruits to candies, hot fudge and other more indulgent sweet toppings. "When we designed this, we looked closely at our model and wanted to make sure that consumers had the ability to customize to their needs," Casey says. "If today they want to be healthy and tomorrow they want to be a little more decadent, they have those options."

The ability to customize extends from the product to the seating. The new store design features soft, colorful, contemporary seating that welcomes guests to hang out and socialize. Depending on unit size, seating capacity ranges from 20 to 40.