Towards the end of 2019, Yum! Brands announced a few strategic hires in order to improve its cross-brand strategy and enhance the overall customer experience through new technological advancements. So, As Yum! gears up for a fresh start in 2020, we dove into some of its top brands’ performances to see how well the company is positioned for a successful new year.
Taco Bell Trends Up
It’s no surprise that Taco Bell’s foot traffic has been on a steady incline over the last two years, as it’s routinely named one of America’s favorite Mexican restaurants. Taco Bell continues to test boundaries and add non-traditional items to its menu, including the newest addition of Buffalo Chicken Nacho Fries to keep its loyal customers happy.
When we look at the period from January 2017 through December 2019 we see significant year-over-year growth. From 2017 to 2018, and 2018 to 2019 the brand grew nearly 6.1% and 3.4% respectively.
If we analyze the months more closely, especially during the summer, we see significant traffic increases. June 2018 to June 2019 saw a 15.6% growth in overall visits. July also benefited during the summer peak and saw a 9% increase year-over-year.
Taco Bell laid out 7 'commitments’ for 2019, back in January which included offering a vegetarian-friendly menu, using more sustainable products and higher quality ingredients. Taco Bell’s continued success is likely due to its commitment to its customers and being bold enough to make changes. Its willingness to learn and try new and inventive initiatives will propel the brand in 2020.
Keeping up with KFC
Despite continuous competition in the chicken sector, KFC has maintained strong year-over-year growth. KFC’s overall visits grew 3.5% from 2017 to 2018 and grew an impressive 8.5% from 2018 to 2019. If we analyze the period from January 2017 to December 2019 we see an obvious upward traffic trend for the brand and when we compare August 2018 to August 2019, we see baseline visits increase by a significant 8.2%
On August 27th, 2019 KFC launched “Meatless Fried Chicken” catering to the vegetarian and vegan markets, which speaks to the brands’ ability to adapt to an ever-changing marketing industry.
The Georgia-based location sold out of the plant-based chicken sandwich within five hours and raised its baseline visits to a staggering 509% compared to 2018, where the visits were still an impressive 143.7%. With such success, it’s likely that we’ll see a 2020 nationwide rollout for the meatless fried chicken.
Willingness to push boundaries and try new things is all the more important as more and more brands are finding ways to stand out amongst growing competition.
Pizza Hut Closing Stores, But Optimizing
Last year, Pizza Hut announced plans to close hundreds of its dine-in locations by the end of 2020 to focus on its delivery business. But, it may not be all bad news. As we took a closer look at one of the Michigan locations that recently closed, we see significant cannibalization between it and another nearby Pizza Hut location. Meaning, many of the locations were likely acting as a direct competitor - taking business away from one another.
Eliminating the lower performing Pizza Hut, in this case, was actually a form of strategic optimization. Closing locations has resulted in a dip in foot traffic in the second half of 2019, but it could also be laying a better foundation for ongoing growth and success. Although a majority of the top pizza chains are closing brick and mortar locations to shift focus to delivery services, it isn’t necessarily a negative. Just as e-commerce impacted in-store visits, the improvement of delivery capabilities will prove to be a very valuable channel for these brands moving forward.
Despite its closures, Pizza Hut is still committed to creating and developing a more focused strategy for the physical world, while also catering to the online, digital age.
Acquiring a Habit
Yum! Brands just upped its burger game with the announcement to acquire Habit Restaurants Inc, a burger chain with a cult-like following. Habit Burger Grill will be in good company, as Yum! Brands already has an impressive portfolio of QSR spots, including Taco Bell, KFC and Pizza Hut. The addition of Habit Burger Grill strengthens its overall portfolio and opens an opportunity into a new market, as it’s the first fast-casual restaurant under the Yum! umbrella.
With new leadership comes new, inventive strategies. So, how will Yum! Brands’s portfolio perform in 2020? Check back with the Placer.ai blog to find out!