Competitive Strategy … the Story of In-N-Out Burger

If you don’t have a competitive advantage, don’t compete. Bold quote from Jack Welch, isn’t it? Is your business in a highly competitive market? Trying to define a competitive strategy? Perhaps you will learn a secret or two from In-N-Out Burger. Maybe even how to establish sustainable competitive advantages.


Can you think of a more competitive market than fast food restaurants?  I have not been able to come up with one. The more competitive the market, the more difficult it is to define a competitive strategy and competitive advantages for your growth. And, oh by the way, price does not qualify as a competitive advantage. Why? It is way too fleeting.

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In-N-Out Burger is a regional chain of fast food restaurants with locations in five US western states, founded in 1948. In-N-Out Burger has slowly expanded into 281 locations from their Southern California roots into the rest of the state as well as into Arizona, Nevada, Utah, and Texas. They have a significant fan following.


Before we continue, let me ask you a question. 

What works best for the growth strategy in your business? We would love to hear what it was. Would you do us a favor and post it in the comments section below? It would be greatly appreciated by us and our readers.


The ultimate goal of all the points I list below is this: eliminate the fluff from your marketing strategy, and focus only on the things that work.


Related material: How Good Is your Learning from Failure?


What is the secret of In-N-Out Burger business’ growth, you ask?


It is not rocket science, but it is a hard lesson for many businesses to learn (especially small businesses).  The question businesses in highly competitive markets need to answer is the following:


How do you make a difference to someone who has infinite choice?


In-N-Out Burger … just another fast food restaurant?  Not so fast … consider their value discrimination.


So the answer to the question of In-N-Out Burger success in a highly competitive market?


unique selling propositions
You must use unique selling propositions.

Competitive strategy … unique selling propositions

Their secret was based on building and maintaining competitive advantages around what their target customers are looking for. The In-N-Out menu consists of three burger varieties: hamburger, cheeseburger, and “Double-Double” (double meat/double cheese). French fries and fountain drinks are available, as well as three flavors of milkshakes. The hamburgers come with lettuce, tomato, with or without onions and a sauce, which is called “spread” (a Thousand Island dressing variant). So far not unique, right?


There are, however, additional named items not on the menu, but available at every In-N-Out. These variations reside on the chain’s “secret menu,” though the menu is accessible on the company’s web site. These variations include 3×3 (which has three patties and three slices of cheese), 4×4 (four patties and four slices of cheese), Neopolitan shakes, grilled cheese sandwich (comes with the same ingredients as the burgers except the meat, plus two slices of melted cheese), Protein style (wrap with lettuce; comes with the same ingredients as the burgers except buns), and Animal Style. An Animal Style fry comes with two slices of melted cheese, spread, and grilled onions on top; Animal style burgers are cooked in a thin layer of mustard, and in addition to the lettuce and tomato it also includes pickles, grilled onions, and extra spread. Hot peppers are also available by request.


Competitive growth … special options

The menu options don’t end there. Many options beyond this can be had by simply asking. You can up the menu options by asking for any burger mustard grilled. After cooking the first side, the cook will squirt some mustard onto the top of the patty before flipping it so that it sizzles into the meat on the grill.


That said, there are those rare moments in life when all you want to savor is the cheese. Order a grilled cheese, and what you get is a soft toasted In-N-Out bun with two slices of American cheese beautifully melted in between. If you ask for it, you can even get the standard lettuce, tomato, and raw onion slices stacked inside.


Of course, those aren’t your only veggie options. Grilled onions cooked down in the collected meat juices on the hot griddle can be added to any sandwich, and come standard if you ask for your burger or fries Animal Style. An Animal Style burger also includes extra Thousand Island spread, mustard grilled patties, and extra pickles. Animal Style fries, on the other hand, are topped with cheese, spread, and grilled onions.


unique customer service
Unique customer service.

Unique customer service

In recent years, some In-N-Out locations have implemented a hybrid drive-thru system during the peak hours during lunch and dinner. In this hybrid service, the system replaces the traditional intercom -based order-taking system with as many as four employees working outdoors.

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These workers take orders, collect payment, and sometimes deliver food to customers’ vehicles. This system, which operates during all but the most severe of weather conditions, is intended to speed up the drive-thru process and increase the accuracy of the orders themselves.


Competitive strategy examples … word of mouth marketing

 With such unique selling points, it is no wonder that In-N-Out Burger gets quite a lot of positive word of mouth marketing.  For many years, it gave customers free bumper stickers which simply said “In-N-Out Burger”.  Others were altered to read “In-N-Out urge”. The company helps devoted customers advertise its brand by selling souvenir clothing with the In-N-Out logo.




So what do you think? In-N-Out knows how to deliver a very different value proposition, doesn’t it?  It certainly forms the basis of a fantastic business growth strategy for them.  


What are some of your business’ competitive advantages that you would share? Please join the conversation.


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Mike Schoultz is the founder of Digital Spark Marketing, a digital marketing and customer service agency. With 40 years of business experience, he blogs on topics that relate to improving the performance of your business. Find them on G+Twitter, and LinkedIn.  


Digital Spark Marketing will stretch your thinking and your ability to adapt to change.  We also provide some fun and inspiration along the way. Call us for a free quote today. You will be amazed how reasonable we will be.


More reading on business lessons from Digital Spark Marketing’s Library:

Retail Design …11 Ways Businesses Are Responding to the Future

Competitive Strategy … the Story of In-N-Out Burger

Business Leaders … 7 Lessons Jack Welch Taught Me about Them


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Competitive Strategy … the Story of In-N-Out Burger