USA – In multinational fast food corporation Yum! Brands Q3 2024 performance, Taco Bell saw 4% same-store sales growth, while KFC’s same-store sales fell by 5%, and its systemwide sales fell by 7% in the United States.
Taco Bell’s focus on value and digital initiatives drove strong results, with its digital sales rising by 30% year-over-year, according to Yum CEO David Gibbs in the brand’s earnings call on November 4.
In contrast, KFC’s limited-time offers (LTOs) and value menus underperformed amid intense industry competition. This disparity highlights a growing divide among chains, with some brands strengthening their value perception in 2024, while others, like KFC, face challenges in keeping pace.
Taco Bell has led Yum’s U.S. performance for several quarters, consistently posting same-store sales growth despite industry pressures. This growth has elevated Taco Bell’s share to 75% of Yum’s U.S. profits, with Gibbs noting the brand has gained market share for multiple consecutive quarters.
Gibbs attributed Taco Bell’s momentum to a strategy that blends value-focused messaging, digital engagement, and limited-time menu items, like the recent Big Cheez-It feature.
The brand has also utilized its Cantina Chicken menu as a testing platform for new items, including the Chicken Al Pastor Street Chalupas launched in Minneapolis last month.
Yum’s decision to allow Taco Bell operators to opt out of the breakfast segment does not appear to have impacted sales. Gibbs explained that this move increased Taco Bell’s marketing flexibility, enabling it to spotlight new menu items in other meal periods, such as its Cravings Value Menu and Cantina Chicken lineup.
However, he emphasized that this strategy is temporary, with plans to bring back breakfast in the future with a “bolder, more distinctive” approach.
While Taco Bell’s combination of innovative menu items, premium offerings, and strong value messaging has been successful, Yum’s other key brands in the U.S. have struggled to gain similar traction.
Pizza Hut reported a 1% decline in same-store sales, while KFC’s 5% drop raised greater concerns.
Gibbs attributed KFC’s U.S. sales challenges to “a more intense competitive environment,” particularly within the quick-service chicken sector. As regional chicken chains like Zaxby’s and Raising Cane’s expand, alongside segment leader Chick-fil-A, KFC’s vulnerability to domestic competition could continue to grow.
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