Uploaded by Khulan Batzorig

Boost Juice Case

advertisement
BOOST JUICE1
The juice and smoothie bars industry in Australia is worth an estimated $404.4 million and employs 3,178
individuals. There are 100 businesses operating within the Australian industry, occupying 628 stores.2
Boost Juice is the largest player in this industry, with its parent company Retail Zoo Pty Ltd capturing
54.2% of the market share. Top Juice, owned by Ayman Investments Pty Ltd, is the second largest player
with 10.7%. The four largest operators account for over 65% of industry revenue. In contrast to Boost
Juice and Top Juice, which are both large-scale franchise operations, most participating businesses within
this industry are small, independent juicers and smoothie operators, with few employees and a single
owner.2
Boost Juice is part of what has been called the “wellness category”, a category of retail organisation that
is one of the world’s fastest growing retail categories. Companies in the wellness category have
experienced tremendous growth.3 With the health and wellbeing trend driving consumer demand for juices
and smoothies set to continue, the industry is expected to expand further over the next five years.
However, industry growth over this time period is projected to be lower, at 4.5%, due to growing internal
competition from new entrants and stronger external competition from supermarkets.2
IN THE BEGINNING
It was 1999. The incidence of obesity, including childhood obesity, was growing, and there was a gap in
the Australian market for a convenient, fresh and healthy alternative to fast food, which at that time was
largely unhealthy. On a trip to the US, Janine Allis, who was working as a publicist for United International
Pictures, discovered the thriving juice bar concept and the idea for Boost Juice was born.3,4 According to
Allis, being a mother was a driving force behind her desire to start her own juice business:
I had this vision of job flexibility and hanging out with my kids more. Naivety’s a wonderful thing.
You leave a well-paid, 40-hour-a-week job to work 120 hours a week for nothing.4
I just wanted to give my children something quick and healthy on the go when we were out, but
there wasn’t much to choose from. I thought if I wanted fresh juice and the convenience of
grabbing something healthy on the spot, surely there would be people like me out there who
wanted the same thing.5
Allis felt she could improve upon the US juice bar concept by promoting the health benefits of juices and
smoothies and delivering a superior customer service experience in more attractive stores.6 Together with
nutritionists and naturopaths, Janine formulated Boost Juice’s menu of “healthy” juices and smoothies
that are preservative, artificial flavour- and colour-free.3
Janine Allis, arguably most recognisable recently through her appearance as one of the “sharks”
(investors) on the Australian reality TV show “Shark Tank”, founded Boost Juice together with her husband
Jeff Allis in 2000.7 Selling the family home and with $250K in start-up capital, some of it borrowed from
friends, the Allis’s opened the first Boost store in King William Street, in the CBD of Adelaide, Jeff Allis’s
hometown, in 2000.5,6,8 Despite living in Melbourne, the smaller Australian city of Adelaide was chosen
because it posed less financial risk due to lower costs, including of leasing sites, and allowed them to
learn from mistakes and build a business model out of the spotlight of a larger Australian city such as
Melbourne.6
1
Boost Juice
STRATEGY
Within 18 years, Boost Juice has grown from a single-store, Australian start-up operated from the Allis’s
kitchen bench in their two-bedroom rented residence, to an over 500-store subsidiary of a multi-brand
enterprise, Retail Zoo Pty Ltd (comprising over 600 stores and over 8,000 employees), located in 16
countries and headquartered alongside the retailer JB Hi-Fi in a four-level, 6000-square-metre office
building in Chadstone Shopping Centre in Melbourne.8,9,10,11,12,13,14 Turning over more than $2 billion since
its establishment15, Retail Zoo is valued in excess of $250 million16, with revenue of over $350 million.17
Its tremendous success has seen Boost Juice, its parent company (Retail Zoo), and its co-founder (Janine
Allis) win numerous awards. These include Telstra Australian Business Woman of the Year (2004), AMEX
Franchisor of the Year (2005), and Winner of National Retailer Association Awards (2008).18
Boost Juice’s strategy is centred on growth. It aspires to be, “one of the world’s most famous and loved
brands”, with its global brand strategy being, “To become to juice, what Starbucks is to coffee”.3,19 Boost
Juice is one of the largest juice and smoothie franchise in the world20, operating in more countries than
any other juice bar world-wide.3 In nine years, Boost has doubled the number of juices and smoothies it
sells each month, from one million to two million.6,21 It has achieved its growth strategy through shifting
into franchising, acquiring the Viva Juice business, and through expanding: overseas, into a multi-brand
platform, into supermarkets, its menu, and into different locations.
You no longer need to frequent a shopping centre to purchase a Boost juice or smoothie. You can
purchase one using the Boost Juice app and then pick it up on the way to university in a drive-through if
you’re commuting from Ballarat, at university in the Union building, or you can buy a bottled juice at a
supermarket to consume at home. You can also buy a snack to accompany your juice or smoothie.
Shift into franchising: With the Allis’s desire for growth and reportedly designed to be a franchise-run
organisation (although Allis denies this in an interview9), Boost Juice started franchising a year after its
inception in 2001. Its first franchise was granted in Adelaide.3,18 With only two stores operating, the
business quickly expanded when Jeff Allis secured an 18-store lease deal with Australia’s largest
shopping centre operator, Westfield, to open stores across Australia.22 In 2001, the first Boost store in
Melbourne was opened. This was followed in 2002 by the first store openings in New South Wales,
Western Australia, and Queensland.18 In 2013, over 40% of Boost Juice franchisees owned multiple Boost
Juice franchises.3
This rapid expansion into shopping centres across Australia necessitated the hiring of employees to help
the Allis’s to manage their growing business. Janine’s first recruits were a personal assistant and a person
to deal with the franchises. Janine and her staff worked from a home office for two years before the staff
of eight outgrew the space, moving to another office which they subsequently outgrew before moving into
their current office located at Chadstone Shopping Centre.9
In the early years of Boost Juice, the financial sacrifice the Allis’s had made to start the business was a
significant motivator for Janine Allis, and there was little personal financial return for the Allis’s. Janine
Allis describes these years as follows:
We were sleeping in the same room as our kids…We were all in. There was no option but to
2
Boost Juice
succeed.4
I didn’t take a salary for three years, and in year four I took out $30,000. I have never been a
highly paid person — you have got to have a long-term vision.4
Acquisition of Viva Juice: In 2004, Boost Juice acquired the Viva Juice business, two years after first
approaching them. At the time, Boost had over 80 stores and Viva had 24 stores, all company-owned and
not franchised. Viva were the only juice and smoothie business that Janine Allis perceived as a competitor
to Boost. Viva’s owner had secured “coveted real estate”, including great sites in Melbourne and Sydney
airports, that Boost wanted. With this being the first business acquisition for Allis, negotiations lasted six
months, and Allis attributes the success of the acquisition to her “girl power team” (Kristie, Naomi, and
Jacinta). All 24 Viva stores were converted to Boost Juice stores, and the Viva employees were onboarded.18
Expansion overseas: Having reached saturation point in Australia, capitalising upon considerable
international expressions of interest and pursuing their goal to become “one of the world’s most famous
and loved brands”, Boost Juice began their globalisation close to home, opening their first overseas store
in New Zealand in 2004.3 With Asia being a focal area, they have subsequently expanded into 24 other
countries, including Chile (2006), Indonesia (2006), England (2007), Portugal (2007), Macau (2007),
South Africa (2007), Singapore (2007), Kuwait (2007), Estonia, Thailand (2008), Lithuania (2008),
Germany (2008), China (2008), Malaysia (2008), South Korea (2009), India (2012), Russia (2013),
Scotland (2015), Bangladesh (2018), Latvia, Brunei (2016), Namibia, Taiwan, and Vietnam (2018).
3,6,18,23,24,25 As at February 2019, according to the Boost Juice Australia website, Boost has 225 overseas
stores in 15 countries.14
Boost Juice’s international expansion strategy sought to “continue the brand’s high growth and high profit
“success story” in new markets, all over the world”.3 Boost’s foundations were perceivably strong enough
to support international expansion: “With our systems, processes and our committed team, we have an
incredibly strong and sustainable base in which to spring-board into the world market”.3 These foundations
were strengthened when in 2010, to raise capital to finance further expansion overseas, Boost Juice’s
parent company, Retail Zoo, sold a majority stake in the business (reportedly 70%) to The Riverside
Company, a US private equity company, for A$65 million.26,27,28 According to Scott Meneilly, then CEO of
Boost Juice, “The biggest change with the private equity coming on board was getting some renewed
energy in there and experience from a board perspective”.28
Procedurally, a primary vehicle by which Boost has realised their expansion overseas is through
appointing a master franchisee in each overseas country, necessitating skill in finding the most suitable
and experienced entity for a major franchise deal.3,6 Master Franchisees, typically people, companies or
partnerships with retail experience operating multiple outlets in the country, are required to commit to a
development schedule, namely an agreed number of retail outlets to be opened in the country over a
specified time period.19 For example, in 2009, Boost Juice signed a master franchise agreement in South
Korea, which was announced by Jacinta Caithness, CEO of Boost International, as follows:
South Korea has already embraced the juice and smoothie bar concept so we are hoping to have
over 30 stores opened within the region in the next three to five years. Our newly appointed
master franchisees, ‘Joseph’ Young Duk Chang and Kim Sung Yeo come to us with significant
3
Boost Juice
retail food and beverage experience in the region, so we look forward to working with them and
using their local knowledge to break into the market.29
Compared to Australian-based employees, master franchisees, local to the overseas country, have the
advantage of local knowledge, including knowing the regulations of the country that need to be met6 and
the taste preferences of the local market. In each overseas country, while typically 70 to 80% of the menu
is the same as the Australian menu, following local research (including focus groups involving taste
testing), the other 20 to 30% is tailored to the specific taste preferences of the locals.3,28 For example, the
cherimoya (custard apple) smoothie is popular in Chile and the lychee smoothie is popular in Asian
countries.30
Expansion into a multi-brand platform: At one of their strategic planning retreats, Boost’s strong
infrastructure (i.e., its back-end departments including franchising, IT, design and development, legals,
finance, marketing) was recognised and became the catalyst for further growth through expansion into a
multi-brand platform. This new strategy was accompanied by a change in organisational structure: Boost
became the foundation brand and subsidiary of a new parent company, Retail Zoo. (Exhibits 1 and 2
illustrate the organisational chart of Retail Zoo and a Boost Juice store respectively.) Accompanying this
new strategy and structure were personnel changes, including Janine Allis stepping down as the CEO of
Boost Juice and Jeff Allis becoming the CEO of Retail Zoo. According to Janine Allis, “…the business
needed new legs to continue the journey” and “Jeff was fresh after a year’s break and we were ready to
swap roles; he was chomping at the bit to make his mark on the company”.31
Retail Zoo’s strategy is to acquire strong, small retail food businesses (comprised of four to ten stores)
that are a cultural fit and enable their growth within Australia and overseas, using their strong infrastructure
to do so.31,32 However, it has also acquired a 23-store business (Cibo Espresso) and launched a business
(Hatch Chicken Shop). Always looking to acquire businesses33, currently, its four brands, in order of
foundation or acquisition, include:
•
•
•
•
Boost Juice Bars (opened in 2000),
Salsa’s Fresh Mex Grill (which was originally named El Taquito, a Melbourne-based, nine-store chain
acquired in 2007),
Cibo Espresso (which was a South-Australian-based, 23-store chain that Retail Zoo acquired a majority
stake in for a reported $15 million in 2012), and
Betty’s Burgers (which was a Queensland-based, 10-store chain that Retail Zoo acquired a majority
stake in in 2017).3,16,28,34,35,36
Expansion into supermarkets: In 2005, Boost expanded into supermarkets, launching a new range of
bottled juices, frozen yoghurt and healthy snacks into Coles.3,18 While Boost Juice has less than 0.5% of
the $1.7 billion fruit juice manufacturing market, their market share is reportedly growing after they started
selling 1L and 350ml bottled products in Woolworths and Coles supermarkets. 26 In April 2017, to meet
customer demand, Boost undertook product range innovation and launched frozen smoothie packs in four
flavours, comprised of whole fruit and vegetable combinations, into Woolworths. Janine Allis articulates
the health benefits of this move as follows: “We wanted to make it easy for people to get more fruit and
veggies in their diet and, with these smoothie packs, we have used a specific combination of the two”.37
Expansion of menu: Boost Juice espouses that they have continued to expand their range of products
4
Boost Juice
to suit customer needs and offer more choice. For example, aligning with dietary trends including low/no
sugar and Paleo diet movements, in 2013 they added the Lean & Green range and in 2015 they launched
the Red Raw range.3
Boost also plan to expand into food, which they have commenced doing at two “Boost &” stores located
in Sydney Airport and Chadstone Shopping Centre in Melbourne. Food offerings include protein pots,
grain and avocado salads, and boiled eggs, which Janine Allis purportedly finds bemusing: “Literally just
two plain boiled eggs and people love it, which is bizarre, because it’s just boiled eggs”. 38
Expansion into different locations: To continue their growth trajectory (and increase their customer
base), Boost has expanded their store locations beyond their traditional home of metropolitan shopping
centres to include regional areas and non-shopping centre locales such as universities, service stations,
and drive-throughs. Boost Juice’s first drive-through, located in Ballarat, Victoria, was opened in 2017 in
response to demand from customers on social media to offer a drive-through option.38
THE CULTURE AT BOOST JUICE
Boost believes that its unique customer service experience, based on the company’s “love life”
philosophy, differentiates the company from its competitors.3 This experience is comprised of three
elements, including the product, the staff, and the store environment, and is (variously) depicted by the
company, in shorter or longer descriptions, including the following:
…a great product served by friendly, efficient people in a positive and energetic environment.3
…a great tasting product, served by positive and energetic people who greet you with a smile
and are polite enough to call you by your first name; in a bright and colourful store environment
with fun music to match.3
Our incredible team members are passionate about giving our customers a great shopping
experience and along with the row of busy blenders at the front of the shop, they are the focal
point of a vibrant, theatrical celebration – the making and mixing of a great smoothie! So not only
is Boost providing customers with an amazing product through the design, shop fit and the
fantastic staff – Boost is creating an experience!3
Love life philosophy: Formulated by Boost Juice’s (co-)founder, Janine Allis, at its inception, Boost
Juice’s “love life” culture, embodying positive attitudes towards living, is readily visible in-store, in the
company’s head office, and in its wider communication. This culture was devised to reflect Janine Allis’s
“…enthusiasm and energetic personality…”3, with Allis explaining:
You can’t fake it…You either are that person or you’re not. And your brand has that essence, or
not. And that is what we thought about when we were building this brand. We wanted the brand
to have a personality, and the way to have a personality is to take the personality of a founder
into the business.38
Observable symbols of this culture in-store include the store design (including the logo and the Boost
Guarantee), the staff uniforms, and the company’s mascot, Barry Boost, who makes appearances at
5
Boost Juice
shopping centres and in street parades and hands out free samples and hugs.3 Designed to make a
strong and lasting brand impression, Boost stores have “…a high quality store fit-out, the latest in light,
new and innovative fittings and fixtures, bright, bold, seductive menu boards and the famous Boost
graphics”3 (Exhibit 3 illustrates a Boost store.) With the significant emphasis on design in shopping
centres, Boost’s store design continually evolves and stores are refreshed every 18 months.28 The Boost
Guarantee, emblazoned on the wall of every Boost store, reflects the “love life” culture. (Exhibit 4 shows
the Boost Guarantee.)
Manifestations of this culture in the company’s head office include the colourful décor, described by Janine
Allis (2016) as “more colours than Play School” (p. 79), no dress code in the support centre, and the
exuberant behavior of its employees, who Allis (2016) characterises as “bouncing off the walls with
enthusiasm” (p. 79). Allis (2016) espouses that the Boost work environment is “fast-paced, dynamic and
vibrant” (p. 79). To keep ahead of the competition, and to excel in this fast-paced work environment, Retail
Zoo employees are ambitious and self-motivated, with many of Retail Zoo’s staff members being
triathletes or passionate about a specific sport.31 Allis (2016) depicts this as follows:
At Boost, we’re achieving twice as much as other franchisors in half the time…[and] to keep up
in this fast-paced environment, our employees regard their role as more than just a job. (p. 80)
Staying late is not a badge of honour. But you do need people to deliver on what’s required to get
their job done. (p. 82)
The “love life” culture is reinforced in the company’s communication, including its corporate social
responsibility (CSR) initiatives, and Boost jargon. A section in the Boost Study Kit (2015) entitled “Loving
Life Loving the Environment” describes how Boost converted all stores from polystyrene to paper cups.
Boost jargon includes:
•
•
•
•
“Boostie”: the (Australian) nickname it has coined for any Boost lover (including employees, customers,
and franchise owners)
o “As a Boostie, you will cross-train within the store to continually learn new skills”39
o “Boost is a franchise business, which means we find the most Boostie partners possible to buy
and run our stores worldwide”3
Boostieship: a Boost traineeship
o “Boostieships – Our unique nationally recognised traineeship program that has been designed
to Generation Y standards and aligned to business objectives”40
Boostagram: the name of its Instagram page
o “The VIBE newsletter also encourages our readers to interact with us by entering competitions
and seeing if they made it to the coveted Boostagram page as legend Boosties of the month!”3
B Gen: an abbreviation for “Boost Generation”
o “B Gen – Everyone employed by Boost is part of the B Gen (Boost Generation) thanks to our
diligent recruitment processes and values.41
The “love life” philosophy underpins Boost’s (and Retail Zoo’s) recruitment, selection and acquisition
practices, including the recruitment of (head office) employees, the selection of franchisees, and the
acquisition of new brands. Shezad Javed, Managing Director of Boost Juice Bangladesh, espoused the
“love life” philosophy when the first Boost Juice store opened in Bangladesh in 2018:
6
Boost Juice
When I had my first Boost Smoothie few years back, it was love at first sip! Since then I had
always dreamt of bringing to our country a healthy alternative to fast food. It is not merely a drink,
but a choice of lifestyle, the "Love Life" attitude. Everyone is simply amazed by the fact that
something so healthy can taste so good! So, whether it's a meal replacement or just a healthy
treat without the guilt, Boost Juice is the correct choice always.23
To ensure that potential employees, franchisees, and brands are a good cultural fit, Allis’s philosophy to
recruitment and retention, instantiated in Retail Zoo’s practices, is: “Hire slowly; fire quickly!”.31 For
example, in 2004, when change was needed, the department heads were asked to evaluate their teams
and to select employees to fire.31 Allis espouses:
There are four people that you need in retail: an operations person, a finance person, a marketing
person and a legal-corporate governance person. They have to be guns; if any of them are not
good, then get rid of them.41
A poor hiring decision, involving employing an accountant as the Chief Financial Officer of Boost Juice in
2001 whose poor advice almost cost the business one of their early investors, instilled in Allis the belief
that she needs to know the business herself, and to understand the financials better than anyone to
succeed.18,42 Correspondingly, Allis has a “very hands on” approach towards Boost Juice’s operation,
keeping a close eye on all aspects of the business.3,6
Boost’s and Retail Zoo’s rigorous recruitment practices involve selecting people who can SOAR
(Solutions, Ownership, Accountability and Responsibility) as opposed to people who epitomise VERB
(Victim, Entitled, Rescue and Blame). Allis believes that cultural fit is the most important criterion to
consider when selecting employees. She espouses that the culture at Boost Juice, and Retail Zoo in
general, is “energetic, honest, passionate, sometimes funky, fun and always high performance”. 31
Comprised of multiple stages, including an audition process for in-store staff, the “cultural fit” interview is
the last stage in the selection process, with questions including:
•
•
•
•
What do you know about Boost?
What is your ideal working environment?
Why do you want to work for Boost?
Our slogan is ‘Love Life’, and we live the values of honesty, integrity and passion. How do
these philosophies apply to you and your current lifestyle?31
While many employees appear to enjoy working for Boost Juice, with the company receiving an overall
star rating of 3.8 out of 5 based on 232 employee reviews (157 of those from Australia) on Indeed.com,
some employees are dissatisfied, particularly with the pay and management. Pay and benefits and
management were the aspects of the job that received the lowest star ratings, at 3.1 and 3.2 respectively.
Conversely, work-life balance and culture were the job categories that received the highest star ratings,
of 3.8.42
Store employees (at all levels) who gave 5-star ratings often commented upon the positive working
environment at Boost while at the same time noting the challenge of keeping up when busy. Employees
who gave 1- and 2-star ratings frequently commented on poor management and pay.43 (Exhibit 5 shows
7
Boost Juice
some employee ratings of Boost Juice.)
ENTERING THE DIGITAL WORLD
The acquisition of Retail Zoo by Bain Capital in 2014 catalysed Boost Juice’s shift into the digital world,
with the introduction of a digital department.34 Christian McGilloway, Retail Zoo’s Chief Technical
Innovation Officer, who has been employed by Retail Zoo since 2013, has spearheaded this shift, and is
head of Digital, the fastest growing department at Retail Zoo. Accolades for his skill and achievements
include being on CIO Australia’s CIO50 list, which recognizes Australia’s top 50 most innovative and
effective IT leaders who are leading organisational change.34 Advances in technology, including EFTPOS
and smart phones, meant that Boost was operating in a new world compared to when their first store
opened in 2000, when purchases were made with cash and mobile phones were still in their relative
infancy, lacking colour displays and the internet.3 Boost espouses that it has “embraced the digital
revolution” and that it has “changed the way” Boost operates.3 This is evident both in-store and online,
with electronic tills and digital posters in-store, and Facebook and Instagram pages online. Designed to
address their limited communication with customers, Boost’s “digital revolution” has seen the introduction
of digital initiatives including the Boost Juice app and two mobile games. Digital expertise has delivered
financial and efficiency benefits to the organisation, saving Retail Zoo hundreds of thousands of dollars
and enabling more work to be performed in a more agile and reactive manner.34
Boost Juice app: Launched in 2014, the Boost Juice app was an instant success, receiving over 250K
downloads in its first three months of operation, and it has continued to grow. Ahead of the competition,
the app was the first retail app in Australia to be fully integrated with the point of sale system in store,
enabling advance, digital ordering of Boost’s juices and smoothies. Despite having created a database of
buyers with Boost’s VIBE loyalty card, communication to its customers was limited.34 The app has
provided a new, digital channel of communication with their customers.
In January 2017, Boost released a new app, providing it with a competitive advantage in the food and
beverage sector. Capitalising upon Agile methodologies to produce this and their other apps, customers
have taken advantage of the app’s new features, including a feature that allows consumers to customise
their drinks, with more than 41 per cent of all drink orders being customised. Drink orders on Tuesdays
via the app, where select drinks cost $5, have increased by 1800 per cent. McGilloway explains the
logistics behind this, and the benefits of the app, as follows:
This has been strategically orchestrated by sending specific advertisements through push
notifications and social media through Salesforce based on purchasing data through our loyalty
system…With 750,000 downloads and more than 300,000 active users, the app has the potential
to be one of the most powerful tools at our disposal.34
Boost Juice games: With the intention of increasing the frequency of customer transactions, Boost Juice
developed and released in the app stores in 2016 its first mobile game, “Free the Fruit”. To convince the
organisation’s leaders to embrace mobile games, McGilloway, who has a background in game
development, gave a presentation on gamification and its effectiveness in changing behavior to Boost’s
founders and senior management team.34 McGilloway describes the rationale behind the game, and its
design, as follows:
8
Boost Juice
We wanted to create a solution to increasing a customer’s frequency into store, as opposed to
them visiting on their own time. We know that 32 per cent of people’s time is spent on smart
devices playing games – on tablets, that rises to 67 per cent.
The game had to be user-friendly and fun. Using a match three formula for the game, we knew it
was something gamers were familiar with and an engaging method for gameplay at any age. 34
This shift into gaming was not without its challenges. It defied conventional marketing in that the game
had minimal branding, gave away free drinks, and did not require signing up to the company’s loyalty
database. More than one million coupons were created consisting of free and discounted products. In the
first few weeks of its release, many in Boost’s partner network found it difficult to see the benefit of having
engaged players and giving players discounted product, fearing this would drastically reduce their sales.
McGilloway explains:
All of the obstacles and challenges were overcome simply through faith and trust in the brand
and team. We had seen so many foreign and domestic companies not adapt to the disruption
which digital was having in their industry and suffer because of it.34
Partners’ “leap of faith” paid off. The game was a resounding success. Over eight weeks, the game drove
11 per cent of Boost’s transactions and over $1 million in revenue.34
In 2018, Boost released its second mobile game, “Find the Fruit”. The game’s premise is that after
watching his friends being turned into smoothies for too long, “Mango Man” has kidnapped them, taking
them underground. Similar in format to Pokemon Go, players need to walk around to assist Janine Allis
to find the hidden and disguised “fruigitives” to release them. After finding enough fruits, a player can
trade them for Boost vouchers. Building on the first game and aligning with Boost Juice’s “love life”
philosophy, an augmented reality experience was added to encourage players to be active and social,
thereby promoting health and wellbeing. As explained by McGilloway:
By introducing the augmented surroundings feature to the Find the Fruit app, we’re hoping to
encourage players to get off the couch and enjoy the game outside. When players find enough
fruit, they can enter a puzzle game which they can play where ever they choose.
Boost Juice is a brand built on our ‘Love Life’ philosophy, so introducing features to the app that
encourage health and wellbeing made sense. We want our players to be active and social, and
‘Find the Fruit’ is a game that is even better when played with friends.43
Joanne Bradley, chief marketing officer at Boost Juice, describes the benefits of these games, which are
digital marketing campaigns for the business, as follows:
These campaigns have really increased the length and frequency we’re able to engage with our
audience and bring in new customers to the brand.44
CHALLENGES AND FAILURES
In addition to its well publicised successes, Boost Juice has also experienced challenges and failures.
9
Boost Juice
Challenges have included Boost’s products being labelled as unhealthy due to the high sugar content and
failures have included failed franchises and marketing fails.
High sugar content: In addition to aligning with dietary trends (such as low/no sugar and Paleo diet
movements), Boost’s introduction of low sugar products, including the Lean & Green range and the Red
Raw range, has also arguably been triggered by negative media attention, with critics labelling Boost’s
products as “unhealthy” and certain smoothies being “equivalent to fast food hamburgers”, the opposite
of how their products are marketed. The unflattering comparison to fast food arose when it was reported
that a 2016 survey from the government-funded health program LiveLighter found some of Boost Juice’s
drinks contained more kilojoules than a Big Mac (from McDonald’s) and more sugar than a bottle of soft
drink. For example, Boost’s ‘Brekkie to Go-Go Super smoothie’ contains 18 teaspoons of sugar and
2560kj, 500kj more than a Big Mac.44 In the face of this criticism, Janine Allis responded with a series of
YouTube videos, in which she made various juices and smoothies, emphasising the natural ingredients,
and in doing so highlighted what she believed to be the health benefits of Boost’s products. In an interview
with Daily Mail Australia, she also defended Boosts’ products by emphasising that the menu has been
designed to cater for different dietary needs:
It breaks my heart when I see these reports. The reason why it breaks my heart is we've got a
range of fresh fruits and vegetables blended in our smoothies. We have a black and green range
– so there's literally just fruits and vegetables blended in our juices – the sugar and calories are
less than an apple. Our other products are genuinely healthy with [sic] higher in energy but they're
designed that way. There are protein ingredients blended, which are designed for people to
recover muscle after a workout or drink as a meal replacement.
It's disappointing when you see headlines about some of our juices being an equivalent to an
unhealthy food – that's not fair. We work with nutritionists and food scientists to trial and find new
concoctions to put together to create our healthy menu.
You hear stories about celebrities drinking just lemon water or others cutting sugar out of their
diet but we forget that we need sugar in our bodies. Sugar is a natural source which comes from
vitamins and minerals. It's all about healthy lifestyle choices – I'm not saying you need to be a
monk on the Himalayas but mostly eating well and eating close to nature - you would never have
to diet again.
And Boost has created these juices along the lines of [this] philosophy and it's the healthiest we
could get. If you want a bit of chocolate or you're a die hard fruit and veg person – we've got that
too.
I can't stand people telling other people what to do. Boost is all about choice. You could get a
ginger shot or a blended fruit or veg at our stores – we've got a selection to choose from.
I love eating fruits and treat myself to chocolates and champagne but I exercise regularly – and
I've never been in better shape.5
Additionally, in the Boost Study Kit (2015), a resource for students available on the Boost Juice website,
Boost Juice counteract this potential criticism of their products, particularly in a section entitled, “It’s what’s
10
Boost Juice
inside that counts”:
So when choosing what to eat or drink, aim to choose ‘Functional Foods’ [with nutritional benefits,
e.g., juices and smoothies] as opposed to ‘empty calories’ [with no nutritional benefits, e.g., soft
drinks] and ensure balance in your diet and lifestyle. And remember at Boost, every product we
make has natural nutrition, making delicious nutritious and healthy easier. (p. 12)
Concluding this section, the Boost Study Kit (2015) summarises the findings of a (single) research study
to support the purported health benefits of juice consumption:
Fresh juice proves critical for children’s nutrient intake
A study from the US has proven the substantial health benefits of consuming fresh 100% juice
on a daily basis, particularly in relations [sic] to the health and wellbeing of children aged two to
eleven years old. The June issue of the Archives of Paediatrics & Adolescent Medicine has been
[sic] reported that children aged two to eleven years old who consume 100% juice on a daily basis
have a better nutrient intake without an increase [sic] risk of becoming overweight.
The two objectives of the study were to determine if, in a nationally representative sample of
children two to eleven years of age, 100% juice consumptions affected (1) nutrient intake and
food groups and (2) their weight status. Despite speculation regarding the high fructose sugar
levels in fruit juice, the likelihood of being overweight was not significantly different between juice
consumers and non-consumers.
The study authors conclude “The weight of current scientific evidence clearly supports the
nutritional benefits of 100% juice consumption and does not support a relationship between
[being] overweight and 100% juice consumption in children. (p. 12)
Failed local franchises: In the face of external pressures, Boost Juice has closed numerous franchises.
In 2012, Scott Meneilly, former CEO of Boost Juice, reported that in the previous couple of years Boost
had capped its store numbers – about 10 new store openings annually were matched by 10 store closings.
Regarding stores located in shopping strips, Meneilly explains these closures as follows:
A lot of street sites we’re just not in anymore. They’re perhaps not performing as well as they
should have been. Street sites are a bit more challenging because of the impact of weather. We
have about 65 per cent shopping centre sites and are always looking to grow that percentage. 28
Shopping centre locales have also been problematic. Increasing rents and downturns in retail have
discouraged Boost from remaining in underperforming shopping centres. 28
Failed international expansion: While Boost has expanded into 25 other countries, according to its
website, as of February 2019, it was currently only operating in 15 of these countries.14 Boost appears to
have stopped operating in Indonesia, Portugal, Macau, Kuwait, Thailand, Lithuania, Germany, China,
South Korea, and Russia.
While Asia has been an area of focus and successful expansion for the organisation, Boost Juice has
11
Boost Juice
failed to take off in several Asian countries, including China. With the necessary retail experience and
expertise from having run Subway in Beijing, Dash Brands President David Keir was appointed the master
franchisee of Boost in China. The plan was to open 50 Boost Juice bars across China in 5 years. However,
Boost’s expansion into China was reportedly problematic on several fronts, with its first store opening
being delayed, the shop fit-out being average, and the product not meeting consumers’ expectations.45
Marketing fails: While many of Boost’s marketing campaigns have been successful, such as their foray
into mobile games, the organisation has also experienced its share of marketing fails where members of
the public have protested, and Boost has had to respond to the criticism. Some of these campaigns have
involved attempts to be humorous, aligning with the organisation’s “love life” philosophy. However, they
have caused offence due to their lack of sensitivity to particular groups.
In 2017, Boost’s “Summer Warrior” ad campaign, featuring models wearing fruit and body paint, was
retracted after public outcry, where accusations of cultural appropriation were levelled at the company.
Offended consumers lambasted the company on social media, labelling the campaign “tone deaf ignorant
content”.46 In response, Boost issued several statements, including the following:
It has been brought to our attention that our recent Summer Warrior campaign has caused
offence. This was genuinely not our intention. We sincerely apologise. We will be removing the
campaign from our [social media] channels.46 [issued on Boost’s Facebook page]
[We were] trying to visualize the power of fruit and vegetables by having people wear it…We are
proud to have a diverse workforce that is made up of people from many different cultures in both
our stores and support office, including Aboriginal and Torres Strait Islander people.46 [issued to
National Indigenous Television (NITV) by a representative of Boost Juice]
In 2018, Boost came under fire again for a Facebook post by one of its franchisees that appeared to make
fun of anaphylaxis in promoting Boost’s new range of peanut butter smoothies.47 (Exhibit 6a presents the
Facebook post.)
Members of the public responded quickly, inundating Boost’s official Facebook page with over 1000
comments, many of which expressed concern about both the range and the joke. Some consumers
reported that they would no longer frequent Boost, with peanut allergy sufferers voicing concerns for their
safety.47 (Exhibit 6b shows a consumer’s response.)
In response, the franchisee posted a personal apology on Facebook and the post was deleted. (Exhibit
6c presents the franchisee’s apology.) Boost also issued an official apology statement to Fairfax Media,
highlighting that the franchisee had been spoken to about the post. 47 (Exhibit 6d shows Boost’s official
apology statement.)
In a Facebook post titled, “Boost Juice FAIL”, Boost was criticised by Allergy and Anaphylaxis Australia
for not contacting the consumer support group for advice prior to releasing their campaign.47
THE FUTURE
Boost’s growth trajectory looks set to continue, with further overseas expansion plans underway and a
12
Boost Juice
potential listing on the stock exchange. In an interview in late-2018, Janine Allis shared that her husband
Jeff Allis was currently in the US and that Boost Juice are launching there. 9
Retail Zoo’s potential shift from being privately owned to a publicly listed company has been the subject
of media speculation in recent years. Retail Zoo’s private equity owner Bain Capital listed the accounting
software MYOB in 2015, and the media has speculated that they will follow suit by exiting Retail Zoo via
an initial public offering (IPO) in the near future.48 Janine Allis discussed this move herself back in 2013:
Every time we have a board meeting we stop and go 'How can we improve Retail Zoo, what's the
best way, what does that look like?". I can honestly say there's nothing definite that has happened
but we've got that curious mind so we've always got our ears and eyes open for potentially great
partners and an IPO is certainly not off the table but there's no firm decision to go to an IPO. 35
13
Exhibit 1
Retail Zoo’s Organisational Chart
Board
Janine Allis (Executive Director)
Jeff Allis (Executive Chairman)
Nishad Alani (CEO)
Warren Valdmanis
David Gross-Loh
David Odgers (Executive Vice-President)
Mike Murphy
Paul Stevenage (Chief Financial Officer)
David Hales (Founder and Managing Director of Betty's Burgers)
CEO
Executive Team
Joanne Bradley (Chief Marketing Officer)
Claire Lauber (Managing Director Boost Juice)
Ceri Clark (General Counsel)
Christian McGilloway (Chief Technical Innovation Officer)
Lisa Fisher (Head of Human Resources)
Angelica Rowe (Creative Director)
Clare Morrison (General Manager of Boost International)
Yvette Van Zwol (Head of IT)
Catriona Houston (Head of Learning and Development)
Accounting
Customer
service
Digital
Finance
Franchsing
HR
14
Learning and
Development
IT
Leasing
Legal
Marketing
Operations
Product
development
Property
Store design
Boost Juice
Exhibit 2
A Boost Juice Store’s Organisational Chart
Store
Manager
Assistant
Manager
Team
Leader
Team
Member
15
Exhibit 3
A Boost Store
Exhibit 4
The Boost Guarantee
16
Boost Juice
Exhibit 5
Employee Ratings of Boost Juice
17
Boost Juice
18
Boost Juice
Exhibit 6a
Boost Juice Cronulla Facebook Post
Exhibit 6b
A Consumer’s Response to the Boost Juice Cronulla Facebook Post
Exhibit 6c
Boost Juice Cronulla Franchisee’s Apology on Facebook
I absolutely do care about people with allergies and made an error in judgment with this comment.
I am embarrassed and disappointed I made this error. My comment in no way reflects the attitude
of Boost.
Exhibit 6d
Boost Juice’s Official Apology Statement Issued to Fairfax Media
The partner now understands the insensitivity of their post and is genuinely remorseful.
We take the severity of anaphylaxis extremely seriously and the safety of our customers
is our top priority. This campaign, and all campaign collateral (including in-store signage) has
been designed to make it overtly clear that we have peanuts in-store so customers are aware
that we are not currently a nut free environment.
Whilst this is not the first time we have had peanuts in store (we previously sold a peanut
butter protein ball), this is the first time we have used peanut butter in a smoothie range.
In light of this, we have taken significant measures to ensure the Peanut Butter, and all
equipment used in the making of the Peanut Butter smoothies, is used, stored and cleaned
separately to equipment used to make all other Boost Juice beverages.
The greatest care has been taken to ensure cross contamination is minimised, including
the extensive training of staff and appropriate warnings both in-store, online and in our app.
19
Download