Welcome to Season 12 of the Troubleshooting Innovation podcast. Joanie Spencer, editor-in-chief for Commercial Baking, is spending this season with Tony Martin, president of Martin’s Famous Pastry Shoppe. They’re exploring how this company has grown from a family-owned brand into a national icon. Sponsored by AMF Bakery Systems.

In our second episode, Tony talks about the unique taste and texture of potato-based products, and how Martin’s takes different approaches to product innovation when working with foodservice vs. retail.

Learn more about this season here, and tune into Troubleshooting Innovation on Apple or Spotify.

Joanie Spencer: Hi Tony. Thanks so much for joining me again this week.

Tony Martin: I’m glad to be here, thank you.

Spencer: Okay, so I absolutely had a blast with you last week getting to know the bakery and the family behind it. So, I’m ready to talk about product innovation. We talked about it a little bit last week, so I want to start out by just revisiting a very simple question: Why potato bread? And thank you.

Martin: Well, you’re welcome, and we love our fans out there for sure.

Potato bread is a niche item. When we started making potato bread, I think there were very few places in America you could actually buy potato bread if it wasn’t from, let’s say, a farmers market in Lancaster County, or someplace where the Amish or somebody was making the item.

It’s a family recipe that my grandparents started with many years ago. I think the story is that my grandmother actually was cleaning homes for a family, and one of the family members had a recipe for potato bread. She got that recipe, and she made it a few times, and, on the side business where they were going to market, they decided to try to make that product. It kind of took off. In the old days, it was a way to stretch your flour. You actually made it in the old days with mashed potatoes. You would take your potatoes, mash them up, put some flour in it, put your yeast in it and you would have a raised product.

That’s not the way we make it today. We make it with dry potatoes, more like you would with mashed potatoes today. You get the dry potatoes, you add the water and mix it all together. That’s how we make ours today, just like every other batch, except we add potato flour to it. The potato flour helps hold some of the moisture in the product. It’s a very moist product, so it has as a lot of keeping quality because of that. It holds on to it. The other ingredients we have in there just go along with that.

We choose to use very high-quality ingredients, including, of course, a high-protein flour, as you would for most hard rolls and things like that. But they get hard, and ours stay soft. That’s where some of the uniqueness comes from. Potato bread and potato rolls, of course, have the same dough structure, just different shapes and sizes. Because of that, the crust on the bread is smaller in comparison to the roll, so it just gives you a different bite and feel. But our product, you know, you could put peanut butter and jelly on it and it doesn’t rip through. It’s just one of the differentiators. But yet, it doesn’t stick to the roof of your mouth. It has a different feel and bite with a slight sweetness to it. We use cane sugar. We always have. We’ve never used anything other than that. So again, it’s just very high-quality ingredients that makes the product very unique.

Spencer: You’re right, and it’s just something that’s experientially different; It’s a different experience than just your regular type of white bread or wheat bread or your typical dinner role. It just brings something a little bit more special, where, like I said, my sister brought potato bread home from Rosie’s Bakery and Deli, and it was just like, “Wait, this is different.” It just has that next level to it.

When you think about a product that’s just a little bit different and has that different experience, even by this much, what drives product innovation? Where would the inspiration come from?

Martin: Well, some of the inspiration came from our customers. We have a new saying that we feel like we’ve actually heard from our customers that it’s all about the bun. We’ve actually sat down with a number of our large customers, particularly the foodservice folks, who have been very, very successful, and they’ve told us that it’s all about the bun.

The product innovation side of it comes from, “Hey, we’d like to have a bigger hamburger than will fit your current 3.5-inch roll.” So, we decided to try a 4-inch roll. And then we had opened a couple places in Texas, and they said, “Well, that’s not big enough. That’s a slider. We need a real roll.” So, we actually made a 5-inch roll. We’ve had a number of customers that put a half a pound of hamburger in a roll. So that caused us to innovate and have to basically upsize everything. So, that’s what we did. We’ve kind of followed our customers’ lead and where they wanted to go. Whether it’s top-sliced rolls, which we call long rolls, that they obviously make a lobster roll or some other ways of using the product.

We’ve innovated within our niche so that we can produce it in a high-quality way, it’s very predictable, and we can get something to our customers that’s somewhat unique for them.

Spencer: So yeah, I mean, you’re in both spaces. You’re in CPG, with the Martin’s brand, obviously, and then you’re working, of course, with foodservice operators, and those require very different types of innovation.

So, on the foodservice side, what’s the ratio between, “I need a bun that’s going to do X or to carry X,” versus the products that you already have that inspire chefs to create a cool kind of sandwich or different kind of burger, based on what you offer?

Martin: I would say it’s been equal over the last 10 years in the areas where we’ve innovated. We did not have swirl product 10 years ago, so we decided to add swirl product. One of the reasons why was because we thought we could produce a product that was of superior quality. It would stay fresh longer. But it’s hard to really break into a particular line or niche.

Let me give you an example: We wanted to make bread, but we didn’t have any bread lines. And because we saw folks making potato bread in the early days, and we did not have potato bread, our customers, or potential customers, were tasting what they thought of as potato bread from a competitor, and it didn’t necessarily go well for the competitor, and they stopped making the product. Now we have a customer base that says, “Well, I know what potato bread tastes like. I don’t think I want it.” So, we found out we needed to get to the market first, because we needed to introduce our customer, who currently likes our potato rolls, to try our potato bread. We quickly found a local bakery that wanted to sell them, so we bought them and basically started making potato bread. I believe that was like 1995 or 1996. That gave us a quick inroad to making potato bread before we could build a building and put an oven in.

So again, customers, and competitors in some regard, force you to innovate so that you can become better and then produce a product that meets their needs. So, both sides … we’re mostly retail and we’re fairly new in the foodservice. But again, it’s a different animal. You’re right. We’re making fresh-to-order products, and we have a very short shelf life on our fresh side, so you have to be really serious about changing an item on that side, because you don’t want to have a lot of changeovers. You have a lot of production line time, and it can become very inefficient quickly.

On the foodservice side, you can afford to do it a little bit because you make longer runs and you can ship bigger orders. So, it’s a totally different animal that we’re learning to understand.

Spencer: From a product innovation standpoint, or product development standpoint, as opposed to the operational side, how do those two worlds kind of coexist, the foodservice product development and the CPG product development?

Martin: Well, we’re a small company, so it’s basically one team, but we kind of divide our time between the two as we’re trying to figure out where our energies need to be put. With the foodservice side, it’s an innovation for us to freeze product, so that has given us a different option for producing longer and more efficient runs than on the fresh retail side. So again, it’s a dynamic that we use the same lines in the same facilities, but with the ultimate end result of where the product goes and how it has to be maintained is very different.

Foodservice has longer lead times, larger orders and fewer of them. And the other side is like herding cats. I mean, it’s trying to get everything in the right order at the right time and not having any breakdowns. Getting it to market in time is a challenge.

Spencer: I am really curious about the cinnamon swirl bread. I have not had the privilege of trying it. I’m very curious about it and dying to try it. What did that sort of ideation process look like?

Martin: Yeah, well, it was actually my brother’s idea to try to bring back a little of the nostalgia of Martin’s Famous Pastry Shoppe, which nobody really knows who that company was. They know us as Martin’s potato rolls. So we tried to figure out if we could stretch outside that zone a little bit and go back to a swirl product. We ended up with three items. We have one that has raisins in it and it’s really interesting from a marketing standpoint. I mean, we originally didn’t have a purple bag, and it didn’t sell very well, but you change the color of the bag and all of a sudden you start selling a little bit more. Well, why? Because the market sees it as a purple bag. And now we’ve come out with a maple sugar swirl. It’s kind of a brownish color with the maple theme and all that. That’s selling really well as a French toast product. That’s my favorite, frankly. When I’m making food for breakfast for my family, maybe on a Saturday morning, that’s their go-to. They want French toast, and so I’ll make French toast out of that.

So that was kind of a throwback, if you want to think of it that way. We’re trying to expand our market a little bit into that area. And then we’ve had a number of foodservice retailers take that product into different ways of using the product in a hotel setting or something like that for morning breakfasts or just different ways. You try to market it to those folks as a little bit of a wider offering than what we had in our narrow niche. So we’re learning; we’re new with this.

Spencer: It’s a fourth-generation company, but innovation is new. You have to be new at it. And if you’re not willing to go outside the boundaries of what you’re used to, you’re not going to move forward, right?

Martin: Well, absolutely, and we have a motto: If you do tomorrow what you did today, you’re going to be behind.

Spencer: Oh, I like that.

Martin: Yeah, you have to do it better.

Spencer: I like that a lot. So obviously, you’re known for your potato-based products, but don’t you also make traditional products as well?

Martin: We do. We have what we call white dough. We have some product that does not have the potato flour in it. One of the primary reasons we have that product – it does sell pretty well, even in markets where you have potato bread — is because in a new market, like I said before, people may have said they tried a potato product and didn’t like it or didn’t find it particularly different. So, our white dough product actually takes off first in a new market.

It’s interesting … In Texas, our hoagie role is actually our number one item and we’ve been there for a year and a half in some markets, two years in others. But over time, and it’s happened in every market that we’ve gone into, eventually the potato product takes over. And so, we have the white dough. It does differentiate. There may be somebody who says, “Well, I don’t particularly like the potato flavor. What else do you have?” So, we have a white dough, hoagie sub roll and we also have what we call Big Marty, which is a white bun, but it has more sesame seeds on it than you’ve ever seen on any sesame seed product. So, those who don’t like sesame seeds, obviously don’t care for it. The ones who like it, you can toast it. That’s one of my favorite products we make, that you can put a big hunk of Vidalia onion in it, or something like that, and mayonnaise, and it’s just really good. Put that together.

Spencer: I am on board; 100 percent, I’m on board. You know, people are funny – consumers – they’re funny because they want to try new things, but not that new. Like, “I’ll branch out, but I’m not going to branch out that far.”

So, do you think that having that more traditional offering kind of helps people take those baby steps toward trying something new, like potato bread, and then discovering that they might actually like it?

Martin: Absolutely. And you have to earn their trust. If they taste it and they like it, and it’s, “Oh, well, hey, I see they make this other product,” and they try that, and then they gravitate to that … I would say our big Marty is very differentiated from the standpoint of the sesame seeds, but it is a white roll. And so, when they finally get to try the potato bread or potato roll, it’s just a little bit more unique. It has that unique savory, sweet flavor. It’s not super sweet. Doesn’t not exist, it’s there. It’s savory. It kind of adds to whatever you put in, kind of enhances it.

So, Shake Shack has really taken us around the country, following their success. In fact, I ate at Shake Shack today; it was fantastic. Then there’s other customers who are really taking off and growing very quickly. They really do feel like the bun has something to do with success. So, we’re trying to keep it exactly the way they want it to help them out.

Spencer: Yeah, for sure. And, you know, I did get to sort of name-drop – I have a 14-year-old son, and he actually has a pretty sophisticated palette. He’s closer to a foodie than most 14-year-olds, and so he loves Shake Shack. We got Shake Shack a couple of weeks ago, and I was like, “The next season of my podcast I’m talking to the baker who makes buns for Shake Shack.” And he was like, “Oh, seriously? That’s so cool.”

So, congratulations on the success that you’ve had, and I know we’re going to dabble in some of that conversation with the success that you’ve had with Shake Shack, but I do agree with you, and I do think that the bun makes a big difference in selling a burger. I’ve done it – I’ll pass or play on a menu item based on what type of bun is on the burger or bread on the sandwich.

Martin: Yeah, some of the competitors we have, I know I’ve heard them say things like, “The bun is just the thing that keeps your fingers clean.” And I love that – they can say that all day long, because we don’t want to be that person. We want to make a product that enhances the item that they’re going to be buying or making their sandwich special.

Spencer: So, we have the people who, and again, just calling on my 14-year-old, I know he’s said it, even though he is a little bit more sophisticated in what he’s willing to eat or try, but he has said it, and people say, “Oh, I don’t like that.” Well, have you had it before? “No, but I just know I won’t like it.” It’s just kind of a go-to, the fear of the unknown, I guess, and trying something new. But then you have this contingent such as myself: I have my personal memories of my experience with potato bread. And there are people who, once they try it, they love it.

What is it, do you think, about this type of bread that evokes a response from consumers? And then ultimately, that loyalty. How do you work that into your product development?

Martin: That’s a great question. And you know, in some ways, I’d like to be able to be able to figure it out so I could bottle it. We know we have that almost visceral response from people that they really do love our product. It almost makes us uneasy, to be honest, when I go to these food shows and they run up to us and say, “Oh, I love your product so much.” And at that point, you’re happy and you’re like, “What am I doing to deserve this?” and all that.

And I know the only thing we can go back to this: It’s the product quality, it’s the consistency, again, it’s the high-quality ingredients. It’s an enhancer. It’s not like MSG, but it just enhances the taste of what you’re eating. And if you toast it, you get a slightly different experience. You can take our hamburger bun and throw it on a grill and toast it on the side before you put your hamburger in, and you get a different experience than if you don’t. If you put ham and cheese in it, it’s just different. So, it just has different appeal to different people for different reasons, and we feel very blessed.

Spencer: Do you take that into consideration when you are doing product development, specifically, I would say, with a foodservice customer? Do you ask them those types of questions, like, “Is this something that you’re going to want to toast the bun for certain menu items?”

Martin: Yeah, absolutely.

Spencer: And take that into consideration for what you’re selling them.

Martin: Yeah, so our product, it doesn’t fit everybody or what they want. You know, I went to a couple of hamburger places that wanted to stack four or five hamburgers on top of our roll, and our roll won’t stand up to that. It’s soft, so it kind of smashed everything down at the bottom. It had too much oil and juice in it. So, perhaps a much harder brioche roll would be a better roll for that. That’s not what we make.

We’re upfront with our customers. If they’re having some concern, we’ll say it’s not a good fit for the sandwich you’re looking for. But, if it’s close, and we think we can say, “Hey, you know, some of our other customers have had success by taking that roll and toasting it hard so that it can withstand a little bit more of the juiciness of that burger and also the wrinkling on top.”

You’ll get a lot of chefs that want a good look to the point where they’re not as concerned about the taste, they want the look. And our product doesn’t always look perfect. Sometimes it’s kind of wrinkly on top because it holds all the moisture in, and it’s difficult to get a perfect skin all the time. Though, most of the time it does look really nice, but once in a while it doesn’t.

So again, you can toast it, and that’s a way to make that product withstand a little bit more. And some people put a little bit of a paper towel around it, which kind of steams the product inside, and that will make the product kind of softer. So yeah, we work with chefs, and we kind of give them ideas on ways of handling our product, and of course, we also take feedback from them. If they say it’s too soft, we’ll look back at the recipe and try to maybe make the product a little bit firmer, stand up to a little bit more, we’ll call it, abuse, and a little bit more juice, that kind of thing.

Spencer: It’s interesting, just talking about the look. My assumption would have been that it would work better to not look perfect on a restaurant plate, because it makes it look more like it was crafted by hand right there, like it gives it a more realistic look. I don’t know. I feel that’s just my opinion as a consumer, that’s what I would go for.

Martin: We would agree with that. In fact, we’ve had a couple of our distributors say to their customers, “Well, if it’s not wrinkly, it’s not good.” It gives it a more home-cooked look, you know. It’s more homely. I don’t know, it has that feel-good feel to it. It’s not the perfect cardboard type roll.

Spencer: Yeah, and because, just knowing what I know from being in this industry, when I eat at a restaurant and the server says, “All of our breads are made in house; everything’s made from scratch. Our desserts are made in-house.” I’m always like, “Really? I don’t know. Is it really? What do you consider made in house? Because I have a feeling maybe you got a dough ball or something you know …” Just because I know what I know, if something actually looks flawed, I personally would be more apt to think it was handcrafted.

Martin: That’s a good point. I’ll have to make sure I talk to our marketers about that and use that.

Spencer: There you go. Feel free, feel free. Okay, so I have one more for you for today regarding product development, and I’m trying to ask this without sounding like I’m asking you to divulge any trade secrets or, you know, any proprietary information. But I am really interested in your experience and your perspective since you do make potato-based rolls and regular wheat-based products. What are the specific considerations that come with formulating a potato-based dough versus a more traditional bread product?

So just top-level stuff, like temperature considerations, or thinking about the machinability, because I just would guess that potato-based dough is going to machine in a very different way than a traditional product, or even water absorption. What are some of those considerations that you all have to think about on a daily basis?

Martin: I would say it probably models very close to traditional items. The potato flour definitely causes more water absorption, so you have to up your water to account for that dry matter, and we use the high-protein flour, so that also helps hold moisture.

Everything we put into it makes the product, I want to say, last longer and taste better. We use high-protein flour. We also use low-fat, dry milk, which we always have. That’s an item or an ingredient that we use in our product that would have been in the old recipes. You know, you would have used milk for your water, because we use dry milk today, so we use water and we use dry milk, just like the potatoes of many years ago.

So, those ingredients together … of course, it would machine slightly differently than without those items. Again, it helps that product stay fresher. In fact, we find the frozen product thawed is actually almost better for foodservice than our fresh because it’s a little tougher. It’s gone through a freeze-and-thaw process, and actually can handle a juicy burger, perhaps better than a very fresh, very soft roll. So again, it’s enhanced characteristics of our product that actually has benefited our customers.

Spencer: Okay, that makes sense. I mean, it goes through an extra workout, and extra workouts make you stronger, right?

Martin: That’s right, exactly.

Spencer: That’s so interesting. I’m going to ask you one last question, kind of to piggyback on that. How do those considerations affect the ways that you can develop new products? Going back to thinking about the swirl bread.

Martin: We look at opportunities in the market that we feel like we have a product that could be well accepted. We came out with our newest, innovative product which was … we made dinner rolls, potato dinner rolls for years, and we sold a lot of them, but we noticed that the consumer palate had changed and looked for more of a sweet type of roll. So, we modified our recipe a few years ago in order to go that direction. And so far, it seems to be paying off. The customers definitely are looking for that product.

We try to follow the consumer trends and look for what worked in the past, and then we give it an opportunity to work in the future. If it doesn’t work, you know, we zig and we zag. We came out with it, and the product looked the same as before, and it wasn’t selling. So, we looked at, “Oh, why is it not selling? Well, maybe it’s the look.” So, we took the double stack and we went to a single stack, and so it looked wider, and it made the product more visible to the customer. Perhaps that made the difference. But all of a sudden, sales started increasing. Like you said before, the customer is unique. We don’t really know exactly why or what’s going to work, but you just keep trying things until it does, you try to understand it and then you try to give them more of it.

Spencer: So, your product innovation, I think it’s fair to say, has led to the growth that you’ve been experiencing. Quality, of course, the quality of your product is how you have made this name for yourself, and then being able to innovate on that quality and that trust is really leading to growth. Is that fair to say?

Martin: Absolutely, if it wasn’t for the quality … you know, obviously we feel blessed about this comment, but we rub elbows with a lot of large competitors, large customers, and in quiet rooms, they all look at us and go, “We love your product. We buy your product when we’re having a cookout.”

So, we know that we’re providing a product that people like, and again, we’re small. If it wasn’t for the product and the attitude towards it, we would not be in business, because we’re just not that smart. We feel blessed that we make a product that they love.

Spencer: Well, that is very modest and humble of you, and I’m not surprised that you would respond in that way. But in talking about that growth, that is a good segue to what we’re going to talk about next week, and that is the operational considerations that come with that growth, because Martin’s has come a long way since the ’50s, since a one-car garage.

So, I’m excited to talk next week about looking at innovation from an operational perspective. But for this week, I just want to thank you for another interesting conversation, Tony. This was educational, and it was really fun, and I just truly enjoy talking to you

Martin: Well, thank you. I enjoyed it, and I’m looking forward to the next discussion.