It’s fair to say that the Chicken Sandwich Wars are more or less over, and just about every chain involved in them came out a winner. Popeyes Louisiana Kitchen changed the nature of its brand. Wendy’s generated some sales. McDonald’s and KFC both enjoyed strong years in 2021 based on their respective sandwiches.
“Never underestimate the risks people are willing to take to get their hands on a fried chicken sandwich,” Lyle Margolis, senior director with Fitch Ratings, said at the ICR Conference on Monday.
There was one exception. Burger King, Popeyes’ sister company, was the last one to go to market with its Ch’King chicken sandwich last year. And the results did not meet the company’s expectations.
Dan Accordino, CEO of franchisee Carrols Restaurant Group, which operates about one in seven Burger King locations, provided a blunt assessment of the performance at ICR on Monday.
“They spent a fortune on the chicken sandwich and it just didn’t do what it was supposed to do,” he said. “The Ch’King didn’t generate the excitement that was hoped for.”
To understand those comments, we examined the same-store sales of three chains that introduced sandwiches last year, McDonald’s, KFC and Burger King. For simplicity’s sake, we calculated same-store sales on a two-year stacked basis and compared the quarters when the product was first on the menu with the chains’ previous, non-sandwich quarter.
The results are telling. Here is the chains’ change in sales the quarter they introduced their upgraded chicken sandwiches, compared to the previous quarter. (McDonald’s and KFC introduced theirs in the first quarter of 2021; Burger King’s came in the second quarter.)
Change in sales, chicken sandwich introduction
Chains’ change in same-store sales the quarter they introduced their chicken sandwich, compared to the previous quarter.
Source: Restaurant Business
All three brands introduced their sandwiches roughly toward the end of the quarter and thus only had a limited impact. In this graphic, it seems Burger King got as much interest as McDonald’s or KFC when it introduced its sandwich. All three chains appeared to get plenty of curiosity consumers.
However, now look at the chains’ sales for the first full quarter with their new chicken sandwiches on the menu. This is when the full impact should be seen.
Change in sales, first full quarter
Chains’ change in same-store sales the first full quarter with their new chicken sandwich, compared to the last, non-sandwich quarter.
Source: Restaurant Business
Clearly, one chain won the 2021 battle in the Chicken Sandwich Wars, KFC, and one proved to be a clear loser, Burger King.
A few caveats apply. First, not all the change in sales can be credited (or blamed) on the chicken sandwich. There are other promotions and marketing at work, as well as various consumer shifts. Also, McDonald’s is larger than KFC and Burger King combined and has twice the unit volumes of either chain, so its 6.6% is more impactful than KFC’s 9% (or Burger King’s -4.9%).
None of them came close to the results of Popeyes, but then again it’s unlikely we’ll ever see anything like that in our lifetimes.
Yet Burger King’s post-sandwich results were nearly 1,400 basis points worse than KFC’s, a surprisingly weak showing. Generally, major chains that introduced new chicken sandwiches and backed them with strong marketing have performed well. They certainly didn’t lose sales.
Exactly why is uncertain. It’s a quality sandwich—all of them have relatively similar quality levels, though customers have their clear preferences. It features the same price point as Popeyes.
Most likely, in our view, is that Burger King was simply late. When the company introduced the Ch’King in June of last year, just about every major restaurant chain had done so. More than three dozen restaurant chains introduced new chicken sandwiches, including both of its top competitors.
By the time Burger King introduced its version, new sandwiches were expected and no longer all that unique. And the market itself was just that much more competitive. As a result, it didn’t get the boost from its sandwich and whatever boost it did get quickly faded.
Burger King has since shifted its focus back toward its core menu. “The focus will be on the Whopper,” Accordino said, echoing similar comments from Jose Cil, CEO of parent company Restaurant Brands International. It’s worth noting that much of the management of Burger King was changed last year, starting with the brand’s North America president, Tom Curtis.
And, as Carrols noted Monday, sales are improving—the franchisee’s same-store sales were up 9.7% in November before omicron weakened sales in December. Yet the Ch’King, it seems, was not the game changer the company wanted it to be.