A National Public Radio story this week concerned Ludo Lefebvre, a successful Los Angeles chef who got cold feet after leaving established restaurants to create his own. With two Mobil 5-star ratings on his resume, $2 million in investor support and a weariness from working for bosses, why did Lefebvre change his plans? His gut told him to do something very different, something that has turned out to be a huge winner in the highly competitive LA restaurant scene.
Instinct is an important ingredient in business model strategy decisions. A winning business model strategy addresses a multitude of questions with answers that fit together seamlessly to carve out a unique space, a task that is very challenging in increasingly cluttered and mature markets. According to New York Times bestselling author Jonah Lehrer in How We Decide, instinct emerges from the part of our brain best designed to find answers to complex questions, the part of our brain in which creative connections arise. No wonder intuition advances our abilities to engage in business model innovation!
Lefebvre’s instincts told him to experiment with a temporary (a.k.a. “pop-up”) restaurant, one that exists only for a few weeks and then disappears. The parallel that gave rise to the concept in the creative chef’s mind was renting an apartment versus buying a home, offering less risk and more opportunity to experiment. In the last few years, the pop-up concept has been especially popular with retail stores and location-specific art installations and performance spaces.
Lefebvre’s first pop-up restaurant, LudoBites 1.0, was located in a friend’s bakery. Sandwich shops and other spaces with daytime-only customer bases provided the canvases for the next four pop-up experiences. Lefebvre changes the menu with each new location, employing student chefs as staff.
One measure of success is the speed with which tables are reserved. Krissy Lefebvre, the chef’s wife, shared in the NPR interview:
“Reservations for the current iteration, LudoBites 5.0, were snatched up in less than 20 minutes online. Most restaurants don’t announce reservations and have 3,000 people come on at once. I mean, it’s really like releasing a concert.”
The pop-up concept is more than an opportunity for Lefebvre to take holidays in between iterations. It’s a brilliant disruption of the gourmet restaurant dining experience. Elite foodies pay an exorbitant premium price for a Michelin 5-star dining experience because of its scarcity–only about 80 chefs earned 5-star ratings last year.
With LudoBites’ pop-up concept, uniqueness is magnified because there is a limited time to experience the restaurant before it is gone forever. If customers miss this opportunity, they have to wait months before they can experience Lefebvre’s magic. At the same time, costs (and therefore prices) are lower due to temporary locations and staff.
Lefebvre deployed his many talents and leveraged his reputation to create a unique market space that allows him to work less while earning more. What does your intuition tell you about how to best differentiate your business and deploy your talents?
For insight on business model strategy, read my recently released book, Beyond Price.