News

Burger King plans to complete breakfast revamp in Q4

June 24, 2010

Burger King is pinning its hopes on its breakfast program, with the remainder of the lin'es new offerings to launch later this year, the company announced at a Nasdaq conference in London on Wednesday. Amy Wagner, Burger King senior vice president of investor relations, said that breakfast presents a "huge opportunity" for the brand, especially in the United States. Breakfast makes up about 13 percent of the sales mix, compared to 25 percent at McDonald's.
 
The new $1 Muffin Sandwich and new premium Breakfast Bowl helped boost traffic during the daypart, making it the best performing daypart for the brand, she said. Thanks to the increase in breakfast interest as well as the company's focus on its value offerings, Burger King gained market share and was one of the few quick-service chains to have positive traffic during its fourth quarter ended June 30. The emphasis on value and consumers' trading down has negatively impacted average check, however.
 
Burger King this week began rolling out its new Seattle's Best Coffee, another important component in its new breakfast program. The coffee rollout should be complete by the end of August. The company is confident the coffee will do well for the brand, particularly since McDonald's coffee initiative helped pave the way by "educating the public" that good coffee is available at burger QSRs.
 
The company has had the new breakfast lineup ready for some time, but delayed its launch to allow the economy to stabilize. With the U.S. unemployment situation expected to stabilize by Q4, Burger King is confident the breakfast launch will be well received, Wagner said. While she did not name specific products, she did say the new program will offer pancakes, scrambled eggs, sausage and bacon — "all the foods that Americans love."
 
Burger King is utilizing its barbell strategy at breakfast as well as in its other dayparts and is developing new products designed for its new Flexible Batch Broiler. Products in test include kabobs; fresh, grilled fish and fresh, grilled chicken.
 
Development, remodeling and social media programs
 
Wagner also provided updates on the company's development and remodeling programs. Development is up around the world as franchisees are taking advantage of lower real estate and building costs. Globally, the company does not expect to enter new countries, although it is considering South Africa and India.
 
The company's remodeling program continues globally, with re-imaged stores experiencing higher traffic and sales. The more attractive interiors encourage more dine-in traffic, which contributes to higher average check.
 
Wagner also announced that Burger King has launched a social media promotion in conjunction with its Twilight Saga: Eclipse campaign.
 
Burger King launched its Facebook page on Monday. Thanks to its Burger King fan pages, the official page already has nearly 243,000 "Likes."