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