Why the World Is Crazy About 'Shake Shack,' the Hamburger Worth Waiting an Hour For

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Shake Shack Cheongdam Branch

[Asia Economy Reporter Shinwon Yoon] There is a food spot that always appears on the must-eat list when visiting New York, USA. The protagonist is Shake Shack, a burger chain that landed in Korea in 2016. Starting from a food truck in a park in Manhattan, New York, Shake Shack has grown into a global franchise operating about 280 stores in 15 countries worldwide. What is the secret behind making the common American hamburger a global sensation?

Shake Shack began in Madison Square Park, a 6.8-acre park located at the intersection of 5th Avenue and Broadway in Manhattan, New York, which is roughly 8,000 square meters. In 2001, as part of an event to raise funds for park restoration, Danny Meyer, chairman of Union Square Hospitality Group (USHG), which operates about 10 dining businesses, sold hot dogs. This was the precursor to Shake Shack. The hot dog food truck, which started simply as an event, gained huge popularity, and in 2004, a store under the name "Shake Shack" opened, selling hot dogs, hamburgers, milkshakes, and more. Although over 190 stores have opened in the U.S. alone, the original Madison Square Park location still has lines that last over an hour.

Shake Shack Burger (Photo by SPC Group)

Hamburgers are fast food? Shake Shack breaks the stereotype

When Shake Shack officially opened its stores, fast food, especially hamburgers, was a declining industry. McDonald's practically dominated the market, and hamburgers were widely perceived as junk food and unhealthy. Shake Shack believed the problem was not that hamburgers had lost popularity, but that there were no hamburgers made with quality ingredients. Therefore, the hamburger patties are made daily from meat free of antibiotics and hormones, and vegetables like lettuce, tomato, and onion are kept fresh. The sauces used in the hamburgers are also freshly made every day.

Unlike typical fast food restaurants that serve pre-cooked hamburgers, Shake Shack prepares orders immediately upon request, which was a fresh challenge at the time. This helped establish the perception among consumers that Shake Shack offered a more premium hamburger compared to McDonald's or other burger chains.

They also leveraged this perception in their marketing. 2004 was the year Facebook, which grew into the world's largest social networking service (SNS), was launched, and Shake Shack decided to utilize SNS. Although hamburgers are something anyone can make at home, to succeed with such food, they needed to attract customers to their stores. So, they created hamburgers worth boasting about on social media and opened various SNS channels to make their food something people wanted to try.

Shake Shack store located in Madison Square Park, USA.

"Sell the experience"

Danny Meyer, chairman and known as the godfather of New York's restaurant scene who operates numerous upscale restaurant chains, says that the "feeling" is more important than taste. According to Meyer, the taste, aroma, and appearance of the food account for 49% of Shake Shack's success. The remaining 51% is the feeling ? the experience. It’s about how customers feel when they visit and how they feel when they leave.

Typical hamburger shops, true to the fast food name, are strongly perceived as places to "eat quickly and leave quickly." But Shake Shack is different. They wanted it to be a space where customers could slowly enjoy their food and have conversations with friends, like in a restaurant. They also do not adopt the common "drive-thru" service to maintain their role and value as a restaurant.

Compared to McDonald's, which has about 37,000 stores worldwide, Shake Shack’s roughly 280 stores may seem small, but based on this growth, it entered the NASDAQ in 2015. Its current market capitalization, representing the company's market value, is about $2.12 billion (approximately 2.58 trillion KRW).