Patrick Doyle on Wednesday was asked about Burger King and its competition with market leader McDonald’s. Doyle took over as executive chairman of parent Restaurant Brands International three months ago, and the biggest challenge he faces is the turnaround of its flagship brand in its biggest market, and it must do so while facing off against the world’s largest restaurant chain.
“McDonald’s is pretty good at the burger business,” Doyle acknowledged in a conversation with investors, introducing himself as RBI’s executive chairman. “There’s no question. They’ve done a great job of reimaging their units. Their units look terrific today. I think their loyalty program has been working very well for them. There is a lot that has gone right over there.”
But, he said, “they do not sell the Whopper.”
Doyle views the Whopper as Burger King’s biggest strength and the key that will unlock the chain’s future. He mentioned the burger by name 11 times during his conversation on Wednesday, according to a count on a transcript of the event on the financial services site Sentieo. It was the first thing he mentioned as he brought up the brand to investors, as well as in an interview with Restaurant Business last week.
Doyle took his view of the Whopper a step further. “The Whopper may actually be a better brand than Burger King,” he told investors. “The Whopper itself is an extraordinary hamburger. There’s a lot you can do with that.”
Doyle’s task on Wednesday was to give his thoughts on RBI and its four brands. And he acknowledged that his comments were more like those of an investor in the company—he’s invested $30 million of his own money into RBI and is not collecting a salary. But he said that his views may be different in a few months when he can have some influence on the company.
In addition, he is hardly the first executive to declare the Whopper Burger King’s primary focal point. The burger chain has a long history of struggles and comebacks, and most of the comebacks have centered around the Whopper. That includes the current situation.
When Burger King revealed its $400 million investment in the company, including $150 million in digital investments and marketing, it helped fund a series of advertisements focusing on the Whopper. The result of this was an addictive “Whopper Whopper” jingle.
The company also introduced some line extensions involving the burger, including a Ghost Pepper Whopper, the Southwest Bacon Whopper and Whopper Melts.
Doyle paid homage to the work the company has done on that front, noting that Burger King’s same-store sales in the fourth quarter rose 5% under Tom Curtis, who heads the brand in North America, while profitability increased some 40%. “It’s getting better,” Doyle said. “It’s not there yet. It is early days on that business.”
To be sure, Burger King has a ways to go. It has a lot of struggling operators, even with that improvement. It also has much lower average unit volumes than any of its primary competitors. McDonald’s, for instance, generates more than twice the average unit volumes from twice the number of restaurants.
Doyle did call that $400 million investment an important consideration as he agreed last year to step in as the executive chairman. He noted that the “Reclaim the Flame” plan included an up-front investment of $50 million in marketing, followed by a franchisee contribution in 2025, so long as the company improves average franchisee profitability by another $35,000 per location by then.
“This is dead on,” he said. “This is what this business needs. We need to be partnering with our franchisee, in this case Burger King. This is a business that clearly needs momentum, and so they’ve gone in and they’ve said, ‘You know what? We’re going to commit advertising dollars upfront. If we can get your profitability to this level, then you’re going to commit to spend this much more on advertising.”
But focusing on the Whopper as part of that marketing and that comeback is important for Burger King, which has failed with its efforts to match competitors on items like a chicken sandwich. Burger King’s “Ch’King” sandwich did not resonate with consumers the way McDonald’s or even KFC’s versions did.
The Whopper, however, is the core of the business. “That’s the point of leverage,” Doyle said of McDonald’s. “They don’t sell the Whopper.”
“That really is the point of differentiation around the food,” he added. “It is the core of this business. And that’s how we ultimately win. That’s our competitive advantage.”
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