TACO BELL PLANS OVERHAUL TO GET BEYOND LOW PRICES: AGENCY THAT WINS CREATIVE REVIEW WILL HANDLE ROLLOUT OF PROJECT GOLD.

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Ad agencies are jockeying for a shot at Taco Bell's creative assignment, and at least one will strike gold.

That's because the winning shop in the $200 million review will shepherd the rollout of Project Gold, the fast-food chain's new menu and marketing initiative.

QUALITY UPGRADE

Executives close to the effort say Project Gold aims to raise consumer quality perceptions by upgrading existing ingredients, and will result in a secondary line of premium products.

Not unlike McDonald's Corp.'s attempt to position Arch Deluxe as a premium burger for adults, Taco Bell hopes to move consumers to a higher price level and at least partially escape the price-driven environment it's credited with helping create.

"They need to create this image move toward quality," said Randall Hiatt, president of restaurant consultancy Fessel International.

Project Gold comes at a time when the No. 4 fast-feeder is surrounded by change. In October, longtime CEO John Martin was ousted in favor of convenience-store executive John Anticoco. In January, parent company PepsiCo announced plans to spin off its restaurant chains, including Taco Bell, KFC Corp. and Pizza Hut.

BOZELL RETAINS BUYING

In the review for creative, now handled by Bozell's Costa Mesa, Calif., office, possible contenders include Foote, Cone & Belding, San Francisco, which in 1994 lost the account to Bozell and the Richards Group, Dallas. FCB is believed to have been courting Taco Bell since last fall (AA, Sept. 16).

Bozell, also included in the review, will retain media buying and field service functions.

No timeline for the review has been officially established, but those familiar with Project Gold say that effort is likely to start early this summer, meaning any agency to work on it would need to be selected soon.

Under Mr. Martin, Taco Bell pioneered fast-food's aggressive use of price promotions and became one of its fastest-growing players. But once burger chains and others followed suit, price was no longer a compelling marketing tool.

A Taco Bell spokeswoman said it was premature to name agencies or say how many are being invited to pitch, and she also refused to comment on Project Gold.

`EXPLORE EVERY OPTION'

Peter Waller, Taco Bell's senior VP-marketing, said last week that "given today's highly competitive quick-service restaurant environment, we believe it is important to explore every option in order to build our sales and transactions."

Bozell is said to have been on difficult ground since it landed the account-shared with Richards until 1995. Its work has reflected Taco Bell's vacillating priorities between discounting and menu innovation.

The costliest example is the 1995 rollout of Border Lights. Despite $75 million in marketing, the effort to sell customers on a higher-price line of low-fat tacos failed. Ads supporting the line were pulled in favor of traditional value-driven promotions.

Bozell introduced the current "Nothing ordinary about it" campaign in March 1996.

Contributing: Mark Gleason.

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