Winning Hearts and Taste Buds

UPDATED: January 18, 2012
PUBLISHED: January 18, 2012

Guillermo Estrada has been studying Hispanic customers since he was a kid back in Mexico, working the after-school shift at a taco restaurant and then taking the bus back home. When he was a teen, his parents sent him and his siblings to the United States through student exchange programs. So it’s no wonder the 38-year-old president of the pizza chain Pizza Patrón knows a little something about attracting and keeping the chain’s Latino (Hispanic-American) customers.

Through key research and an undying interest, he knows whether the chain’s core customers speak a little Spanish with their families, or a lot. He knows whether they’re second- or third-generation immigrants. And he knows how important, or unimportant, Hispanic cultures are in their homes.

Long before the U.S. Census reminded us that Hispanics were the fastest-growing demographic in the United States, Pizza Patrón was researching this emerging growth market, and going after it not only by offering distinctly Latin flavors and ingredients, but also through marketing, customer service and overall ambiance. “A lot of companies think you can just put up a sign in Spanish that says, ‘I’m open,’ ” says Estrada, whose boss, company founder Antonio Swad, opened the first store in Dallas 25 years ago.

“Well you know what? It doesn’t work that way. You have to make sure you connect with the community. You have to make sure you connect with the customer.” How he and his team have managed to do that offers valuable lessons to all of us.

Knowing the Market

Estrada is adept at reciting the numbers related to key population trends: By 2015, one-third of the nation’s population 19 and under will be Hispanic. In 2020, one in five Americans will be Hispanic. By 2050, that number will be one in three.

These numbers may or may not surprise businesspeople who have been working to figure out and snatch up the Latino customer. But Pizza Patrón has been collecting this data for years, deliberately catering to its core Latino customers and at the same time growing its non-Spanish-speaking customers. “The Patrón is on trend,” says the company’s PR packet, footnoted with reams of recent consumer research. “Pizza Patrón is at the forefront of an historical shift in American culture.”

And while this information might seem overly specific to some—after all, do you really need to know that your so-called Hispano customers (Spanish preferred; some English) came to the States when they were 10 years old or older?—it’s allowed Estrada and his small, tight management team to market with power and confidence. Today, the company is the nation’s No. 1 Latin pizza brand, with 101 stores in seven states, and plans for 750 new stores nationwide within a decade.

“We’re very selective about what type of information we use, and how we go out and get it,” says Estrada, who was promoted to president of Pizza Patrón in 2009 and once managed Latin accounts for Tyson Foods Inc. “We’ve been serving the Hispanic community for 25 years and we have been franchised for seven. By deciding on having this appeal, you have to do your homework.”

Bottom-up Management

Estrada and his team use real estate experts to go into a market and study the demographics and population. Pizza Patrón then makes sure the food is prepared with each restaurant’s customers in mind—which means plenty of chorizo in one market and plenty of jalapeño or pineapple in another. “The Cuban is a different Hispanic than the Puerto Rican from New York,” Estrada says. In other words, a Hispanic is not a Hispanic is not a Hispanic.

“We look at the local chains and all the menu tweaks they’ve made,” he says. “Once we’re open, we start learning from the customers.” This takes time, he says, and lots and lots of attention to detail. Besides understanding customers’ cultures, their culinary likes and dislikes and their habits, you have to talk them up, make them feel comfortable the minute they walk in the door. So cue the Latin music and décor. And you have to promote events in Hispanic communities—at schools, churches and town centers.

There is one trait nearly all their Hispanic customers share, Estrada says: They are fiercely loyal and often recommend their preferred businesses to family and friends. But when something turns them off, they may just disappear. Why? Some feel it is impolite to voice a complaint. So Estrada says Pizza Patrón relies heavily on frontline employees to convey precious information about customers’ likes and dislikes. “Every complaint, we follow it down to the detail,” he says. “Our employee training is very complete.”

The Pizza Patrón management team has minimal layers, so it’s not a bureaucracy. “It’s funny,” Estrada says. “The biggest ideas are coming from the employees. Sometimes organizations are so large, but in our case it’s just the founder and myself. It’s only one or two levels.” This makes the information flow up, easily and naturally. Plus, somebody from corporate visits each store four times a year. “We go to the market and we spend time there,” he says. “We make sure people are properly trained and we evaluate how the brand is being represented and if we have the correct procedures in place.”

Estrada thinks it’s their one-on-one customer approach that has really helped snag this market. Some of their strategies seem downright brilliant—at least in retrospect. In 2007, when the company announced it would accept pesos at restaurants, Pizza Patrón had millions of TV impressions—some good, some not so good—including a video skit on The Colbert Report. A year later, when it opened its first concession at the American Airlines Center in Dallas, the under-30 crowd knew exactly who Pizza Patrón was. When local restaurants do something in the communities, store managers tweet about it and post pictures on Facebook.

Estrada, a down-to-earth guy with a wife and two little girls he drives to school every morning, doesn’t mind talking about his company’s knack with Hispanic customers. Indeed, corporate colleagues are constantly pestering him about how they do it. His tips?

If you’re not a Hispanic, you have to have a Hispanic manager who is involved in the community. “That is going to be your link,” he says.

Keep your eyes and minds open. “You have to understand how they think,” he says. For example, Mexicans like to say hello and they like to hug and “you have to be open to those things.”

Be engaged. Be engaged. Be engaged. “If a customer leaves you, it’s hard to get them back,” Estrada says. “That’s the worry of every restaurant. It costs more money to get a new customer, than to treat your existing customers well.”

Step 1, at least at Pizza Patrón? “We try to be friends first, and then do business later,” he says. “We do the little things, and then we have our strategies in place.”

 Read our interview with Papa John's founder and CEO, John Schnatter, for more insight on running a fast food empire.