How to create a Cronut-like craze in 3 easy steps.
1. A dollop of product innovation.

“Finding a new idea is a lifestyle, not a moment. Anything can be a source of inspiration,” says Cronut-creator, Dominique Ansel.

2. A dash of social media and local marketing.

Look to prominent voices in your area to champion your product or service. For example, Smashburger grew from three locations in Denver to 150 restaurants nationwide by ramping up its Facebook and Twitter outreach.

3. A pinch of sustainable growth.

“We could do thousands of Cronuts every day, but what would happen to the rest of our products?” Ansel says. “The issue comes down to quality control. I’d rather do less and be able to maintain the quality than to sell so much it hurts our reputation.”

The Creator Of The Cronut On How Your Business Can Whip Up A Cronut-Like Craze

A healthy dollop of innovation, a dash of social media, and a pinch of brainy, badass growth—a recipe for success we can all follow from bakery owner Dominique Ansel, who guided the meteoric rise of his Cronut.

The phenomenal rise of the "Cronut"—part doughnut, part croissant—inspires tremendous confidence in the potential of U.S. small businesses, which fuel the country’s engine of economic growth and creativity.

The Cronut frenzy also offers several lessons for small merchants everywhere looking to build their brand. Let’s look at some of the key ingredients in creating your own Cronut craze.

Introduced last month, the Cronut has customers lining up outside Cronut creator Dominique Ansel’s SoHo bakery at 6 a.m., and the store regularly sells out its daily production of at least 300 within a half-hour after opening. The pastry has already spawned countless imitators and a secondary market in which Cronuts are resold at an 800% markup.

This enormous popularity is no accident. In fact, the Cronut’s success reflects the many strengths that characterize America’s small-business sector.

Here’s the small-business recipe for a Cronut-level hit:

1. A dollop of product innovation.

"Finding a new idea is a lifestyle, not a moment. Anything can be a source of inspiration," says Ansel. "Five or six of us sit and brainstorm every week. Every time I put together a menu I try to do something new, something with a twist."

Developing a game-changing product is less about building from scratch than about creative reinvention. Ansel identified the best features of two existing popular foods and tested 10 different ways to combine them. The concept of "convergence," or merging multiple product types into one, is an important way to expand beyond your business’s historical category and target market needs that are going unmet. Consider the RadioVault, which fuses MP3 speakers with a locked bedside drawer, or the recent emergence of laptop-tablet hybrids.

2. A dash of social media and local marketing.

The Cronut could never have made such a big splash without the support of local influencers. New York "foodies" quickly took to social media and blogs to spread the word and generate widespread exposure. Look to prominent voices in your area to champion your product or service. For example, Smashburger grew from three locations in Denver to 150 restaurants nationwide by ramping up its Facebook and Twitter outreach. Remember to protect your brand, too—when buzz began to grow, Ansel trademarked the Cronut name.

3. A pinch of sustainable growth.

Even when demand is high, scaling up too quickly can compromise quality control, damage customer service, and dilute your brand. For now, Ansel has limited daily Cronut production to 300 a day to ensure each pastry meets his standards and has kept the price locked at $5 apiece. He plans to expand by adding staff and gradually increasing Cronut output. Ansel also remains clear that his bakery will not become a Cronut store and will continue to serve its loyal customer base, many of which prefer other baked items to the Cronut.

"We could do thousands of Cronuts every day, but what would happen to the rest of our products?" Ansel says. "The issue comes down to quality control. I’d rather do less and be able to maintain the quality than to sell so much it hurts our reputation."

Owners who try to transform their companies often try to do too much at once. A smarter strategy is to focus on a few strengths and leverage those advantages into long-term growth. Warby Parker found massive success through online sales, but instead of increasing distribution by selling glasses through third-party stores, it has held on to its close quality control standards and preserved its social responsibility mission while gradually expanding its product offering.

These three ingredients are behind the successful business that brought us the Cronut, as well as the many other small merchant enterprises driving innovation today. If you’re cooking up a plan to make a major impact, follow this recipe. The results will be sure to whet your appetite for success.

Ed Jay, is the senior vice president of the American Express U.S. Small Merchants Group, which advises small merchants on how to grow and connect with their communities and grow their customer base. Follow him on Twitter at @edjay.

[Image: Flickr user Katy Watts]

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2 Comments

  • miken40

    It might be my imagination but it looks like you say in your article that Smashburger grew to 150 locations by "ramping up it's Facebook and Twitter outreach." I daresay they did a heck of a lot more than that to grow to 150 stores.  The least you could do is imply there was more to it than that.  Their FB presence is pretty boilerplate (sweepstakes and grand openings).  They also do a terrible job of engaging their fans on Facebook.  They do not respond to fans when they register a complaint or ask questions.  So in in that sense they actually do a pretty subpar job of managing their main social media outlet. 

    The other thing you fail to mention regarding Ansel's and the Cronut craze is that NY is it's own overcrowded, desperately insecure microcosm.  Ideas spread here like the plague in an overcrowded slum.  Remember these are the same people who lined up for mediocre cupcakes at Magnolia a few years ago and who stand in line to get into the flavor-of-the-month overpriced yet mediocre restaurant so they can tell their friends.  What NY does have going for it is that most of the major news and live programming outlets are based here and run by New Yorkers or transplants.  The real "influencer" success that Cronuts had was more about getting Cronuts into the hands of people like Tony Bourdain, Maria Bartiromo and Piers Morgan and getting chef Ansel on national broadcasts.  That PR is worth a gagillion times more than Ansel's 7,000 Facebook likes.

  • azzy

    This guy did not invent the croissant donut. Grocery stores in the Midwest have been making and selling croissant donuts in their bakeries for years, including stores like Piggly Wiggly and Marianos. At a price point of less than $1 each. Just because he may have a better marketing plan, does not make him an inventor.