When we say 'challenger' perhaps the global fast food giants aren't the first brands to spring to mind, but the cut-throat world of quick serve restaurants has plenty to teach ambitious brands looking to unseat an incumbent giant, or at least get their slice of the action. In 2014 Taco Bell, one of the world’s largest Mexican fast-food chains, set it sights on the lucrative breakfast market in the US by launching a new breakfast menu. But McDonald's dominated in what is a habitual eating occasion for most customers - the daily Egg McMuffin stop on their way to work - Taco Bell needed to do something dramatic to change that ingrained behaviour by embarking on an all-out breakfast war.
We spoke to Sam Renzi and Greg Dzurik at Collider, Yum! Brands’ in-house strategy/innovation agency for Taco Bell, KFC, and Pizza Hut, to find out how they've become a key player in the category in only 2 years by taking an explicit challenger stance inspired by the eatbigfish book Overthrow .
What was the ambition and opportunity?
We wanted to break into the breakfast game and if you're thinking about all the fast food brands that could've played in the breakfast game, Taco Bell would've probably been the last one that you would've put on your list. There wasn’t an intuitive, natural connection with breakfast, and then we also knew that we were up against a huge competitor. McDonald's, 30 - 40 years ago, established the breakfast category in fast food and since then that has been their bread and butter, they had invested heavily. By the time that we were going to enter it, they had the largest share of voice, they had the largest share of buzz online when it comes to social media conversations for breakfast, and they had a dominant market share. So we were going up against a big, big dominant player.
The morning is a very habitual time of day. You wake up and you follow the same routine, you're trying to have a very easy, streamlined morning, you want to set yourself up for success, so we rely a lot on habits and routines to get us there. People are more likely to go to the same place for breakfast every morning. They'll drive by the same place on their same route to work and furthermore, they'll even get the same exact thing every single time, just because it's a deeply embedded, ingrained habit. And that habit was dominated by McDonald's. They owned that breakfast routine.
How did you puncture that habitual behaviour?
We decided to take on a challenger approach. We discussed collectively as a group, based on the conventions we need to shatter and what we had to offer, what challenger position or challenger stance would best fit for what we had to offer and what would disrupt the category in the best way, and we ended up going with the Next Generation challenger stance.
The breakfast category hadn't really evolved, it hadn't had a lot of innovation for 40 years and consumers found that to be a little bit tired, a little bit tiring. And so we knew that the Taco Bell's product were much more youthful and vibrant and energetic and cool and modern and very much today. They're always kind of pushing the envelope, they are a brand of firsts. And so it was both a product truth and a brand truth that we thought, you know what, that's something we could stand on - and we've been standing on it ever since - we leaned right into that next generation stance.
How did the new breakfast menu reflect the strategy?
What we wanted to do was take all the classic breakfast ingredients that people love, because people in the morning still love the same things, but put a Taco Bell kind of spin on it and made it feel a little bit more modern, have a little bit more edge. So for example, the AM Crunchwrap had a hash brown, eggs and bacon and cheese, inside the crunch wrap tortilla. And so it was an ownable form that Taco Bell had, but it was more of a new world form versus just a traditional breakfast sandwich. They had breakfast burritos, they had breakfast tacos, so a lot of it was your traditional classic breakfast ingredients and taste, but done in a much more modern form.
The marketing campaign was very edgy - you’re calling out the competition in a very direct way.
So there really was a two-pronged approach to it, two phases; the first one was just to get on the breakfast radar for consumers, so Deutsch LA created this brilliant campaign where they had people whose real name was Ronald McDonald rave about Taco Bell breakfast. That definitely got us on the breakfast radar.
And then after that, the work has been reflecting that next generation challenger stance, leaning into it and using it to frame up how, whatever that new breakfast product or offering is, it's the next generation of breakfast.
Could you share any results around the success of the campaign?
Well, from a results standpoint, it's been really successful for Taco Bell, just from just a social media standpoint, there's been a crazy amount of buzz, especially a lot of positive buzz, now Taco Bell is one of the key players in the breakfast conversation and they really established themselves as a breakfast player.
People now think of Taco Bell as a place to go to for breakfast. It's in that consideration set, which is huge, because that was a huge barrier for them to overcome. But then just from a sales standpoint six percent of their sales now come from breakfast, which is pretty great.
Inspired by this story and want to take on your competitor in a head to head challenge? Make sure you read our "Challenger's Guide to Running a Two Horse Race" to prepare your brand for the fight ahead.
Challenging ideas, something out of nothing, lover of progress. Mark Barden is a partner at eatbigfish and based in San Francisco.