Taco Bell’s comps soar, Pizza Hut’s new strategy disappoints

Yum! Brands reported strong domestic sales growth in 2014 for Taco Bell and KFC, but acknowledged that the extensive redesign and menu overhaul of Pizza Hut did not meet expectations.

The franchisor pegged Taco Bell’s comparable-store sales increase at 7 percent for the fourth quarter of 2014 and 3 percent for the full year. Management attributed the increase to the introduction of breakfast, the rollout of a new app, and strong acceptance of new breakfast, lunch and snack products.

KFC finished 2014 with a fourth-quarter comp increase of 6 percent, which raised the same-store gain for the full year to 1 percent.

Pizza Hut’s comp sales were flat for the fourth quarter and declined 3 percent for all of 2014.

“While the initial relaunch of the Pizza hut brand in the U.S. did not deliver the sales lift we expected, consumers have responded positively to the new menu and we intend to leverage this more effectively going forward,” commented Greg  Creed, who assumed the CEO’s job at Yum! on Jan. 1 after heading Taco Bell.

During the fourth quarter of last year, Pizza Hut’s domestic operations undertook what the chain described at the time as the most dramatic change ever undertaken by the 56-year-old brand. The concept was recast to be more Chipotle-like, with customization offered on an assemble-to-order production line.

Recipes were rewritten to incorporate what Pizza Hut called “the flavors of now,” and 10 specialty pizzas were added.


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