It’s that time of year. Time to look back and reflect upon the brand developments in quick service from the past year—from the surprising to the exciting and the defining—that seemed most important. Innovation and growth are a couple of the common themes among the top fast-food brand stories of 2014.
Taco Bell. Taco Bell alone was responsible for three of the biggest industry news items this year. The company started the year launching a 14-item breakfast menu. The innovative menu, which included the mold-breaking Waffle Taco and the hit A.M. Crunchwrap, wasn’t the only bold aspect of the launch. The aggressive marketing campaign also aimed squarely at McDonald’s, with one TV spot featuring men named Ronald McDonald enjoying the new breakfast fare.
Taco Bell’s competitive assault continued with the introduction of its new value menu, Dollar Cravings. The menu debuted with 11 items at 99 cents or less. Its introduction came on the heels of McDonald’s adding $2 options to its value menu and rebranding it as the Dollar Menu & More. Dollar Cravings also commanded attention in the wake of price increases at most fast-food restaurants over the summer.
Taco Bell topped these two developments with the launch of a new fast-casual concept named U.S. Taco Co. and Urban Taproom in Huntington Beach, California. Offering a simple lineup of premium tacos, thick-cut fries, shakes, craft beer, and wine, U.S. Taco Co. is a distinct departure from the Taco Bell brand. It also differs from Chipotle in product offering and vibe, but it’s clear Taco Bell is trying to capture its share of the fast-casual boom with a concept that appeals to higher-income foodies.
Burger King. In August, Burger King announced a deal to buy Canadian doughnut chain Tim Hortons. The $11 billion transaction raised eyebrows for several reasons, including questions of the two brands making unlikely bedfellows. Tim Hortons is a beloved Canadian brand, while Burger King has been floundering in the U.S. for several years. Executives maintain that they will continue to operate the brands independently, but the deal is likely to give Tim Hortons the solid U.S. market penetration that has eluded it in years past, while helping Burger King develop a stronger breakfast offering.
Panera Bread. The rollout of Panera 2.0, a suite of new technology systems, was intended to improve the brand’s customer experience through operational changes and new service options. Panera 2.0 offers new ways to order (mobile ordering, order from your table, and kiosks), payment by mobile app, and a special to-go pick-up area. The changes serve as a preview to other technology-enabled developments likely to appear in the industry in the coming years.
Dunkin’ Donuts. The strength of the Dunkin’ brand and its ability to challenge Starbucks are being tested by Dunkin’s expansion into California. It opened its first freestanding location in the state in Santa Monica in September, and it says it has plans to open nearly 200 Golden State stores in the next few years. California is home to many East Coast transplants who have been begging Dunkin’ for years to head west, and California is also where several of the nation’s highest coffee consumption markets are located. The outcome of this story remains to be seen, but the development definitely qualifies as big news.
Starbucks. Speaking of Starbucks, the No. 3 fast-food chain in the world seems to hold a permanent spot on my annual list of big brand stories because it is always breaking new ground in some way. This year, two news items secured its spot. First, the company announced it would reimburse college tuition for its workers by picking up most of the tab to get a degree through Arizona State University online. Significant on several levels, the move was an important brand development. It is intended to enable Starbucks to attract better talent, reduce employee attrition, and enhance the performance of its people, all of which translates into better service, a real benefit for customers and an advantage for the brand.
More recently, Starbucks launched its first-ever brand campaign. “Meet Me at Starbucks” chronicles a day in the life of Starbucks through a mini-documentary, shot in 59 different stores in 28 countries by 39 local filmmakers. Instead of focusing on its products like the company normally does in its ads, this effort emphasized the emotional connections made possible by the brand.
Shake Shack. The final top brand story of the year is actually one that hasn’t completely unfolded at the time of this writing. But Shake Shack’s pending IPO has already grabbed the headlines, so it’s sure to continue to be a noteworthy development of the year. While the move may seem unusual for a relatively small player (the brand operates about 50 units in fewer than 10 states), it is actually riding the wave of successful restaurant IPOs this year. Zoës Kitchen raised $70 million in April, and investors ponied up $123 million for El Pollo Loco in July. With Shake Shack offering plenty of unit expansion potential and average unit volumes that are four times those of Five Guys, it’s likely investors will find its stock as appetizing as its customers find its burgers.
I’ll be back in January, answering your questions and helping you build great brands. If you are an owner, operator, or company executive with an issue or challenge with brand building, send me an email at [email protected] and I might respond in a future column.