New York (CNN) — Cinnabon is facing an existential threat as it turns 40: How does a chain that’s become synonymous with the food court evolve when fewer malls are being built?
GoTo Foods, Cinnabon’s parent company, isn’t looking too far for a solution. Next month, Cinnabon is opening a first-of-its-kind location with sister brand Carvel that mashes up Cinnabon’s hot and gooey cinnamon rolls with Carvel’s ice creams for a selection of desserts.
“We took this concept to a very broad swath of consumers early on (and we) got this ringing endorsement from about 80% of the US population,” Jim Holthouser, CEO of GoTo Foods, told CNN. The concept is largely aimed at attracting Gen Z and Millennial eaters, who “definitely have a desire for unique indulgent experiences.”
He describes the indulgence as “little treat culture,” a reference to a popular social media trend among younger consumers purchasing small, affordable sweets or items as a reward for mundane daily tasks.
The menu at “Cinnabon Swirl” is designed for the TikTok audience, where unique foods are often brought to the top of people’s algorithms and become viral sensations. GoTo Foods hopes it will draw in customers as mall foot traffic has stagnated in recent years and traditional food courts have disappeared in favor of more upscale options.
For starters, there’s the “Bonini,” a cinnamon roll warmed in a panini press, sliced in half and filled with ice cream. Then there’s the “Cinnabon Swirl Sundae,” which features the sweet center of a cinnamon roll as its base and topped with soft serve ice cream. Rounding out the menu are ice cream sandwiches served with Cinnabon-inspired cookies and Carvel-influenced toppings, like sprinkles or cookie bits.
A small selection of Carvel and Cinnabon staples served at their standalone locations — cakes, ice cream and cinnamon rolls — are also on sale.
Attracting franchisees
GoTo Foods franchises their brands, which also includes Auntie Anne’s, Jamba, and Schlotzsky’s. Pitching owners to invest in an unproven concept is often met with hesitancy. However, “Cinnabon Swirl” was an instant hit, Holthouser said.
“We really had no problem signing people up, which is a little unusual,” he admitted. “Usually when new brands are birthed, a lot of owners are going to sit on the sidelines to make sure that things kind of work out the way they think.”
The first “Cinnabon Swirl” opens in May in Oregon, with another three opening by the end of this year in Peoria, Arizona; Kennesaw, Georgia; and Pasadena, California. An additional 30 locations are slated to open in 2026.
Unlike other mashups, most recently Dine Brands’ Applebee’s-IHOP restaurant, the Carvel brand wasn’t included in the name, although its colors and logos are featured in the store.
The concept “leads with” Cinnabon “simply because that’s most known to consumers,” with Cinnabon having about 2,000 locations globally. That massively dwarfs Carvel’s roughly 400 stores, which are predominantly in the US northeast, Holthouser said.
Moving beyond the mall
GoTo Foods has built up its portfolio with smaller, niche brands that largely depend on foot traffic, attracting customers as they are out shopping or traveling. That means the economics of their restaurants are not as sustainable as standalone locations.
One way it’s trying to solve that problem is by opening more co-branding locations, emulating the success it’s seen with plugging Auntie Anne’s into Jamba and Cinnabon locations.
For example, an Auntie Anne’s “works all day long in a mall,” but it doesn’t make enough money to “justify the rents” of a standalone location, Holthauser said. But when an Auntie Anne’s together with a Cinnabon or Jamba is combined, profitability improves.
“If I want to keep these brands going, keep the stories going and be able to serve consumers, I’ve got to find other ways of building distribution for these brands,” Holthouser admitted.
Experimenting with dual-branded locations is a focus for GoTo Foods, with the goal being to “drive efficiencies and unit-level productivity by focusing on best sellers at each chain,” noted David Henkes, a senior principal at Technomic, a restaurant research firm.
“I’d liken it to a greatest hits compilation from both chains — taking the things that work best and removing menu items that perhaps don’t resonate as much,” he told CNN.
Both Cinnabon and Carvel could use a jolt of sugar, too: Cinnabon sales declined 0.5% last year and Carvel slipped 6.5%, according to data from restaurant research firm Technomic. (GoTo Foods is privately held and doesn’t release financial information).
The rise of dual locations has “seemingly caught fire,” Henkes said, pointing to the Applebee’s-IHOP concept that first opened in Texas with plans for a dozen more to open in the coming months.
“The idea is to bring the strengths of two brands under one roof and hope that 1 plus 1 equals 3 (or at least 2.5), generating a bit more incrementally in revenue while hopefully reducing the cost structure,” Henkes said.
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