Courtesy of QSR
One of the less-publicized facts about Taco Bell’s menu is that it’s actually vegetarian friendly. The YUM! Brands’ chain even has a section of its site that guides consumers through going meatless. Business Insider, this past October, ranked Taco Bell’s vegan offerings, which isn’t exactly a common practice in the fast-food lexicon. In fact, Taco Bell is the only American Vegetarian Association-certified quick-serve in the country. But is this a widely known point of differentiation among consumers?
In 2019, Taco Bell wants to peel back the plant-forward curtain.
The brand announced Thursday seven commitments, or resolutions, for this coming year. Among them: An upcoming test of Taco Bell’s first dedicated vegetarian menu in stores, as well as new featured vegetarian items. Currently, Taco Bell has more than 8 million vegetarian combinations, it said. That means guests can customize a new meal, every day for nearly 20,000 years. Taco Bell said it wants to become a more accessible option for vegetarians and flexitarians overall. And expects to launch campaigns and menu items around everything that entails. For a brand that historically fronts the product innovation space, driving forward in this underserved category could open doors during what promises to be another change-filled year. Perhaps the best take: It's more of a menu alteration than a revamp for Taco Bell, meaning it's cost efficient as well as trend-setting.
“We decided to scratch the idea of New Year’s resolutions and instead make New Year’s commitments,” said Julie Masino, president of North America at Taco Bell, in a statement. “From simplifying our ingredients while improving food quality, to creating more new jobs, to improving our recycling efforts, these are just some of our promises to keep doing even better and being even better, and they are promises that we know we will keep.”
In 2018, Taco Bell was, by most definitions, the crown jewel of YUM!’s performance. It closed the third quarter of fiscal 2018—the chain’s most recent report— with an 8 percent increase in system-wide sales and same-store sales growth of 5 percent, year-over-year. The brand opened 59 new units in the quarter and enjoyed a series of headline-grabbing launches, especially the Nacho Fries, which executives said was the most successful LTO in company history (which is saying a lot). More than 53 million orders were placed during the original run from late January to April.
There were 6,942 Taco Bells at the end of Q3, up from 6,738 in the prior-year period. The growth represented a 3 percent change, year-over-year. Twenty-two international restaurants (gross) opened in Q3 as well, hinting at another wide-open opportunity for the brand. Just this November, Taco Bell debuted in London. Three more are expected in the coming months, joining Taco Bell’s 28 other U.K. restaurants. Domestically, Taco Bell is aggressively growing its Cantina brand, complete with alcohol, in New York City. Since 2015, Taco Bell has opened 19 Cantina restaurants and 16 Urban In-Line Concepts throughout the country. With the opening of the new spots, New York City will be home to three Urban In-Line locations and three Cantinas. “The research we’ve done in New York tells us that our fans want an experience that parallels their lifestyle—fast and at their fingertips,” Mike Grams, general manager of North America and global, said at the time.
Toward the end of 2018, Taco Bell unveiled its new, unified value menu called the “Cravings Value Menu” to replace its previous dollar menu. The offerings now range from $1 to $5, hitting on two of the most-buzzed about price points in fast food. So instead of owning the dollar space, Taco Bell is hoping to reign over both categories. Or at least have strong footing across each occasion and customer preference. Last year, Taco Bell said it would expand its $1 offerings by another 20 items, accelerating a trend in its menu history. The brand offered 11 items for $1 in 2014 and more than doubled that by 2018. It surpassed that 2018 goal and launched the Cravings Value Menu with a $1 Grande Burrito in two varieties—Chicken Enchilada and Three Cheese Nacho. The menu is divided into four categories: Specialties, Sweets, Tacos & Burritos, and $5 Boxes. Taco Bell said it would continue to add items over the course of 2019.
On the technology front, Taco Bell started 2018 with an “All Access” initiative it said would provide frictionless digital experiences for customers and employees. This includes self-serve kiosks, faster networks, and further investments into restaurant technology. Not to be forgotten: YUM’s $200 million stake in GrubHub, announced in February. In October, YUM! said the integrated delivery solution was launched in 2,100 stores nationwide, covering about 30 percent of the U.S. market (this includes KFC). Taco Bell offered delivery in more than 1,000 restaurants across 50 markets at the start of the 2018.
Make Taco Bell as craveable as ever with even simpler, higher-quality ingredients
The big take here: Taco Bell removed all artificial colors and flavors from its core menu, and, where possible, plans to continue removing preservatives and other additives from its food, the chain said. By spring of 2019, it expects to have fully removed the synthetic preservative tBHQ from all of its menu items.
Additionally, Taco Bell is in the process of reducing sodium from its menu and is aiming for a 25 percent total reduction by 2025. Taco Bell also said it’s continuing its pursuit of using higher-quality ingredients. One example: In the U.S., the chain uses grilled all-white meat chicken, vine-ripened tomatoes, and makes its guacamole only from Hass avocados. Pico de gallo is now made fresh every day as well.
Work to ensure all of its beef is sustainable
Taco Bell joined the U.S. Roundtable for Sustainable Beef, a network of beef experts comprised of representatives from the supply chain, academia and research, environmental, and animal welfare organization, and veterinarians all working together to improve the sustainability of U.S.-grown beef.
This appears to be a major trend for quick-serves moving forward. McDonald’s dove full in with its policy in December. The company introduced a broad policy to reduce the overall use of antibiotics important to human health, as defined by the World Health Organization, which applies across 85 percent of McDonald’s global beef supply chain. The complex undertaking will take McDonald’s two years to even decide how much of the antibiotics important to human health it will be able to remove from beef.
Shortly after, Wendy’s said it would make changes to its practices to move toward a more sustainably sourced food supply chain. The brand partnered with the Progressive Beef program, an innovative animal care and sustainability program that is built on industry-leading best practices and third-party verification, to oversee and improve its beef program from beginning to end. This partnership will allow Wendy’s to improve practices in its beef supply chain from the way cattle is raised and cared for to overall sustainability, it said.
Improve recycling efforts, one cup at a time
Taco Bell recently rolled out recyclable cold cups and lids in all of its U.S. restaurants, which account for more than 95 percent of its drinks sold. Taco Bell said it is committed to making 100 percent of its restaurant cups recyclable by 2021, with help from its partners at the NextGen Cup Consortium Challenge.
In 2017, Taco Bell said it would remove XL soda cups (it did so). It also met past goals to use only cage-free eggs across its menu, and serve chicken raised without antibiotics important to human medicine.
Be even easier and better for vegetarians and flexitarians
We touched on this note earlier. The idea of a dedicated vegetarian menu at Taco Bell, however, is really an interesting development to track. It’s the type of change that won’t be for every fast-food player, but it’s likely to be copied and envied by many.
Not make consumers choose between affordability and craveability
This is related to the earlier value change. Taco Bell said it has “fans covered for every meal with value that is truly beyond belief. At the same time, Taco bell will continue to offer incredible, abundant value beautifully boxed at just $5.”
Earlier in the year, YUM! CEO Greg Creed said, “I think the product innovation continues to be world class. I still believe that there's no better product innovation that comes out—that doesn't come out from Taco Bell.”
“Taco Bell's ability to innovate and elevate around both their marketing and products highlights the fact that the brand proudly stands in a category of one,” he added. Taco Bell’s movie trailer theme marketing campaign around Nacho Fries and its apparel line with Forever 21 were two standouts.
Create more jobs
Taco Bell isn’t backing off its previous commitment to create 100,00 new U.S. jobs by 2022. Simply, as Taco Bell grows, so do employment opportunities. Taco Bell had a previously stated goal of 200 store openings annually, and 8,000 stateside, 9,000 globally, by 2022.
Support the Taco Bell Foundation in its efforts to enable young people to pursue their passions and dreams
Building on that previous note, the Taco Bell Foundation more than doubled its funding goal, committing to award $21 million in scholarships by 2021, with more than $4 million on the table for 2019—$1 million more than what was awarded in 2018. Customers will also be able to round up their order total to the nearest dollar to checkout ($1.49 Crunch Taco becomes $2) to help fund education.
In regards to employee benefits, Taco Bell didn’t skimp this past year. In November, Taco Bell said it was well ahead of its commitment to award $10 million in Live Más Scholarships by 2020. Three years to be exact.
Another 2019 push was the introduction of Hiring Parties in July. Taco Bell invited job-seekers into restaurants to learn about benefits and experience the company’s culture on-store, with games, free good, merchandise, on-the-spot interviews, and gift card “hiring bonuses.”
Back in March, Taco Bell announced it was extending its Guild Education pilot to all 210,000 employees in its system of 7,000-plus U.S. restaurants. Previously, Taco Bell piloted the program in about 700 company-run restaurants, a pool of more than 2,000 employees. Taco Bell saw a 30 percent increase in employee retention for those enrolled over the first six months. Employees enrolled in a course, program or degree through Guild had a 98 percent retention rate in that same space—a 34 percent increase over those employees who were not enrolled.
Taco Bell promotes a robust benefits program for employees at corporate-owned stores as well. Shift Managers and above, as well as Team Members on one of Taco Bell’s medical plans, have year-round access to board certified physicians who can prescribe prescriptions via phone consultations through the Teladoc program. For all company-owned stores, there’s $5,000 in company paid basic term life insurance for Team Members. YUM! also offers a 401K plan with company-matching contributions, dollar for dollar up to 6 percent. Other benefits include: $10,000 in company-paid basic term life insurance for Shift Managers (amount increases with level); vacation of 1 to 4 weeks based on job title; and a free tobacco cessation program through KickButs.
Taco Bell unveiled its plan of 100,000 new jobs by 2022 in fall 2016. The “Start With US, Stay With Us,” platform arrived last November. Education was center to this strategy. The Graduate for Mas Program, which to that point had enrolled nearly 600,000 people, helped participants who promised to graduate gain access to resources, mentorship support, prizes, and rewards, such as scholarship. Read More