KFC owner says its 2-for-$5 deal on fried chicken wraps is winning over low-income shoppers that are being pummelled by rising costs
- KFC launched a two-for-$5 promotion on fried chicken wraps earlier this year.
- This deal led to strong sales from low-income shoppers at KFC during the first quarter, its parent company said.
KFC's new two-for-$5 deal on fried chicken wraps is drawing in low-income shoppers struggling with rising costs, executives at its parent company said during an earnings call early Wednesday.
"In the Q1 KFC rolled out those $5 wraps," Yum Brands CEO David Gibbs said during the call. "The strongest sales that they saw in a customer segment in Q1 were with the lowest-income consumers. So the part of the business, the part of the consumer base lifting sales was from low-income consumers because they did a great job connecting with them through that offering."
Gibbs told investors that the focus of KFC US is "targeting new audiences" by creating value such as through the introduction of its boneless offerings including the Double Down sandwich and chicken nuggets.
KFC added chicken wraps to its US menu in February 2023 after a trial in Atlanta in 2022. To celebrate its release it launched the 2-for-$5 deal. Insider reached out to Yum Brands for more details on how long the deal would run but did not immediately hear back.
Consumers are struggling with expenses and cutting back as a recession looks increasingly likely.
McDonald's CEO said last month that customers are pulling back on ordering fries with their burgers and ordering for delivery as they become more conscious about how they spend their dollars, Insider's Grace Dean reported.
In 2022, Yum Brands said it would pivot to focus more on offering promotions and deals across its brands KFC, Pizza Hut, and Taco Bell as demand slowed for pizzas and fried chicken.
This included bringing back Mexican pizza at Taco Bell, $5 macaroni and cheese bowls at KFC, and more lower-price deals at Pizza Hut.
Same-store sales grew 8% globally at Yum Brands during the first quarter. Still, increased promotions – along with higher food and labor costs – made a hit on quarterly profits, which fell short of Wall Street expectations, declining by 25%.