Burger King has been struggling in recent years, in part because of
the economy but also because the chain had been lagging in menu
innovations. But after an active quarter of what it calls its
biggest menu expansion ever, and a highly publicized -- and in some
cases, criticized -- celebrity campaign promoting the new menu, the
chain is turning its misfortunes around.
The chain, which last year fell to the No. 3 burger chain by
2011 sales in the U.S., in April rolled out a menu expansion that
was reminiscent of menu innovations McDonald's
previously introduced: smoothies, frappes, salads and wraps. BK in
total introduced 13 new items, and in June introduced sweet potato
fries and a maple bacon sundae as part of its summer barbeque menu;
Wendy's also introduced sweet potato fries this year.
Burger King in April introduced the new menu items with a new
tagline, "Exciting things are happening at Burger King," enlisting
celebrities such as Jay Leno, David Bekham, Mary J. Blige and
Steven Tyler in ads to make a splash. At the time of the menu
rollout, Burger King was aware that the new items were already
available at competing chains, which is partly why it brought in
celebrities for the marketing. "The platforms themselves have been
out for quite a while," SVP-North America Marketing Alex Macedo
told Ad Age in April. "The big challenge is how do you really grab
people's attention? And most of all, how do you get them to taste
the product?...We chose celebrities to get people's attention
faster and to show the diversity that we have with our brand."
However BK went about marketing its new menu items, something
worked. The chain in an earnings call this morning pointed to both
marketing and the new menu as significant contributors to the
chain's sales growth, particularly in its U.S. and Canada division.
Steve Wiborg, president of Burger King North America, said that he
was pleased with the chain's second-quarter performance and the
marketing and new menu, which broadened its consumer profile,
especially with women, children and seniors.
And that broadened consumer profile is exactly what BK was
hoping for. It had long focused on men, particularly the core
fast-food demographic of 18- to 34-year-olds. But that strategy hit
the chain hard, especially throughout the recession, as many young
men found themselves struggling financially, ultimately cutting
back on spending. Burger King last year, when it hired Dentsu's
McGarryBowen as its
agency, sought to broaden its appeal amongst consumers, hoping to
grab demographics that McDonald's had been able to attract.
The chain has since adopted a roster of agencies, including Mother ,
which created the celebrity campaign, and David, an Ogilvy offshoot,
which produced the barbeque campaign, running this quarter. It also
enlisted Los Angeles-based Pitch, which has been creating work for
Burger King's kids items, as a general-market agency.
Mr. Wiborg also said that the chain felt that the
celebrity-laden campaign was the "right approach" for the new menu
marketing, and that the April launch of those new items was
"integral to our results," adding that the chain's new broad
marketing approach will continue to grow sales. The chain also said
today that in the first quarter it had intentionally spent less on
marketing in anticipation of its celebrity campaign in the second
quarter, and indicated that spending in the latter half of the year
would increase over the first half.