This viral menu item couldn't save Burger King from the biggest issue plaguing the fast food industry
Hollis JohnsonMac n' CheetosMac n' Cheetos may have been one of the most talked about items in recent fast-food history, but they didn't save Burger King in the second quarter.
On Thursday, Burger King reported that same-store sales at US restaurants open at least a year fell 0.8%, with global same-store sales growing by 0.6%. Total profit for Burger King and Tim Hortons parent company Restaurant Brands International, however, beat expectations at 41 cents a share, compared to analysts' estimated 35 cents, according to Bloomberg.
According to executives, Mac n' Cheetos - which debuted as a limited-time item in June - were a major success for the chain. The company reported that the item earned 3.2 billion impressions, making it one of the most covered product launches in the fast-food chain's history. But impressions do not translate into sales.
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Burger King's sales slump is part of a wider problem in the fast-food business, with McDonald's, Yum! Brands, and fast-casual chains like Habit Burger also reporting sales slowdowns. Consumers are increasingly choosing to eat at home, despite aggressive discounting across the fast-food industry.
Despite the sales slump, Burger King executives said they plan to continue the strategy of launching high-impact new items, such as Mac n' Cheetos and Grilled Hot Dogs, which the chain debuted in the winter.
"We did see things slow down a little bit, but the same strategy that we've had in place for the last five years is going to continue," Restaurant Brands International CEO Daniel Schwartz said in a call with analysts. "There's no silver bullet. It's about delivering great guest experience."
Further, executives defended Burger King against the idea that the chain - which has managed a comeback since 2011 by focusing on launching fewer items - was adding too many wacky items to the menu in 2016.
"What we don't want to see is kind of a variety of new small products. To the extent we have an existing platform, innovating around that platform, it's okay," said Schwartz. "When I look at the innovation pipeline coming down the road, I feel good that the platforms are going to be few and - obviously - we're planning on them being impactful."
In other words, Burger King isn't finished with launching quirky new menu items to stand out in the struggling fast-food industry. The company is going to be selective - but Mac n' Cheetos are just the beginning.