Latest news with #Portalatin
Yahoo
22-04-2025
- Business
- Yahoo
KFC's US sales fall behind Raising Cane's, Wingstop
This story was originally published on Restaurant Dive. To receive daily news and insights, subscribe to our free daily Restaurant Dive newsletter. Chicken chains, including Raising Cane's, Wingstop, Chick-fil-A, Zaxby's, Bojangles and Popeyes, saw consumer spending increase in 2024 while KFC saw consumer spending fall, according to Circana's Definitive U.S. Restaurant Ranking 2025 report. KFC's U.S. consumer spending fell 4% to $4.34 billion, with the chain now ranked #23 in the U.S. by Circana's estimate. The brand was passed by Raising Cane's (#16) and Wingstop (#21) in the rankings, as both chains saw dramatic sales growth amid a general expansion of the chicken segment. Wingstop's 41% growth in consumer spend marked the largest gains among the top 50 chains, while Raising Cane's 31% expansion was second greatest. Circana attributed both brands' success to digital engagement and media strategy, in addition to the growth of the chicken category overall. 'Raising Cane's partnered with Post Malone to design custom restaurants, while Wingstop is the official chicken partner of the NBA. As a result, both brands heavily over index with Gen Z, and digital media drives a large percentage of their visits,' the report stated. It is no surprise that the biggest jumps in consumer restaurant spending are coming from chicken chains. 'Chicken servings lead the growth in animal protein servings in the restaurant space,' said David Portalatin, Circana's senior vice president and industry advisor for food and foodservice, in an interview. But this, he said, was less about consumers waking up to a specific protein, and more about brand strategy. 'It's really a reflection of when operators execute well and create a good value for their customer, then that's well received in the marketplace,' Portalatin said. Portalatin said that consumers are particularly responsive to menu innovation on staple menu items or perceived elevation of existing offerings, like chicken sandwiches. 'Every time over the last several years that somebody expands their geographical footprint or innovates a new version of the chicken sandwich, we see servings growth of chicken sandwiches,' Portalatin said. Given the success of the segment, it is surprising how KFC continues to struggle with sales growth. KFC's total consumer spending fell 4% last year while other chains grew, according to Circana's The Definitive U.S. Restaurant Ranking. This embedded content is not available in your region. Among QSR and fast chicken chains, KFC has now fallen to fifth place in terms of estimated consumer spend, behind Chick-fil-A, Popeyes, Raising Cane's and Wingstop, but ahead of Zaxby's and Bojangles. Popeyes' 2024 consumer spend increased 6%, according to the report, despite value-related stumbles in the mid-year. Both Wingstop and Raising Cane's lag behind KFC in one metric: buyer penetration, with Wingstop at 19% and Raising Cane's at 24%, while KFC sits at 29%. But this is indicative of the strength of the challenger brands — higher sales at lower penetration indicate considerable customer loyalty or higher ticket, either of which means both chains have whitespace to grow. KFC, despite the breadth of its reach, isn't generating the same buzz. KFC's efforts to promote itself as a value-oriented brand seem not to have struck gold, and the brand is looking to turn things around. In January, Yum Brands shifted Scott Mezvinsky, formerly of Taco Bell, to lead KFC as CEO. Late last year, the chain debuted a sauce-focused concept with a strong tech element. In February, Yum announced it was transferring the brand's headquarters from Kentucky to Texas, where Pizza Hut is headquartered. Outside the United States, however, KFC has performed quite well, with 8% systemwide sales growth and 1% same-store sales growth in its international divisions, according to Yum's most recent earnings report. Recommended Reading Inside KFC's tech-centric concept Sign in to access your portfolio
Yahoo
19-04-2025
- Business
- Yahoo
Circana: Restaurant traffic stalled in 2024, but diner spending rose 2%
This story was originally published on Restaurant Dive. To receive daily news and insights, subscribe to our free daily Restaurant Dive newsletter. Consumer spending at restaurants rose 2% in 2024, according to Circana's 2025 Definitive U.S. Restaurant Ranking Report. Consumers spent $1 million at restaurants every minute last year and almost everyone in the United States went to a restaurant within the top 50 chains, Circana said. Restaurants within the top 50 chains each capture e annual consumer spending of over $1.35 billion. These restaurant chains comprise 61% of the entire restaurant industry spending, but account for only 24% of all restaurant locations. While consumer spending was up overall, some of the largest chains, including McDonald's, Starbucks, Dairy Queen, Burger King and Cracker Barrel, had flat spending growth. But in the current macroeconomic environment, flat could be a good thing. 'Flat is the new up,' said David Portalitan, senior vice president and industry advisor, food and foodservice at Circana. 'You have to work really, really hard in the current environment just to stay even.' Larger chains had greater difficulty boosting growth than smaller chains, which had a larger percentage change in consumer spend year over year. However, the large chains did see some positive shifts following value offerings, he said. Value deals generally drove traffic up more than 5%, but traffic was typically negative in the absence of a meal deal. 'The value wars, so to speak, have certainly moved the needle with consumers,' Portalatin said. 'We have seen consumers increase their perception of value. Their overall satisfaction with value per price paid has been increasing toward the end of 2024 so consumers are recognizing those deals.' Value will continue to be part of the equation this year, reflected by value offerings from McDonald's and other chains. But value is not necessarily about the price point, especially since consumers are already committing to paying more when they order out or dine out, compared to making dinner at home, Portalatin said. 'Consumers are placing an emphasis on other aspects of the value equation: the quality, those craveable indulgences that I cannot make for myself at home, the customer service, the experience, the convenience,' Portalatin said. 'These are the things that are differentiators in the restaurant landscape.' Despite McDonald's recent traffic struggles, the chain has an extremely high annual buyer penetration at 86%, meaning a majority of consumers visit McDonald's at least once a year. Comparatively, the second-highest penetration rate is 55% for Taco Bell. 'McDonald's is such a large and ubiquitous chain and they're conveniently located — you can't go anywhere in this country that a McDonald's is not relatively convenient for you,' Portalatin said. 'That's a big part of the quick service restaurant format, the convenience of access and speed of service, and that just makes them relevant to most consumers at some point, on some occasion.' Even with relatively stagnant restaurant traffic, Circana did see movement among chains. Dutch Bros joined the top 50 list for the first time, and Raising Cane's and Wingstop rising up in the ranks thanks to 31% and 41% increases in consumer spending, respectively. Dutch Bros increased consumer spending by 26%. 'What this report reveals is that there are restaurant operators out there who are not only alive and well, but who are thriving and growing and moving up the list and ranking,' Portalatin said. Recommended Reading Why quality may trump price in 2025's restaurant value battle
