The Real Reason Burger King Is Struggling To Stay In Business


Fast food restaurants need to keep up with
changing trends, but in recent years, business
hasn’t been smooth sailing for Burger King.
The fast food chain is definitely having some
trouble.
Why are they in a tough spot?
Well, it’s a bit complicated…
In November 2018, CNN revealed how Burger
King had fallen behind some of its biggest
competitors.
Part of the problem may have been that the
chain was focusing on the wrong thing entirely.
Instead of adding new menu items to stoke
people’s interest, Burger King was relying
chiefly on gimmickry.
Take 2018’s Halloween stunt, for example.
That’s when BK released its altogether creepy
burger, The Nightmare King.
“Well Burger King says it’s got something
new for you if you dare try it.
It’s their new creation and it is called The
Nightmare King.”
The ad campaign claimed that this limited-time
burger offered a combination of proteins and
ingredients that would interfere with sleep
patterns and cause nightmares.
Does that whet your appetite?
“Someone in my dream turned into the burger.
The burger then transformed into the figure
of a snake.”
Of course, the actual science was a little
questionable, but here’s the thing: The promotion
undoubtedly got people in the door wanting
to give this Nightmare King a try, but it
wasn’t something that would necessarily keep
people coming back.
Customers stopped in and purchased their weird
burger, but what reason did they have to return
to Burger King once the promotion came to
an end?
Once The Nightmare King was no more, momentum
slowed down and sales once again declined.
Ultimately, the gimmicky promotion didn’t
work as well as, say, creating a brand new
Whopper variation that could become a menu
staple.
Gimmicks are great, but the novelty eventually
wears off.
What Burger King needs is long-term, devoted
customers who love their products and keep
coming back for them.
Many customers were excited when Burger King
announced a partnership with Impossible Foods
to develop the plant-based Impossible Whopper.
Finally, a vegetarian and vegan option for
fast-food lunches on the go!
“Tastes like a Whopper.”
“Tastes like a Whopper.”
“Tastes like a Beef Burger.”
“It’s made of f—in’ beef right here, see
that?
It’s beef.”
“We swear, it’s not beef.”
At first glance, the product was a win, but
there was a major catch.
According to Inc., one huge mistake had the
potential to alienate a whole bunch of people:
Burger King acknowledged that the plant-based
Impossible Whoppers would be cooked on the
same equipment used for beef and chicken.
Of course, this was a major bummer.
It meant that the meat-free burger wasn’t
actually vegetarian or vegan after all.
Of course, there’s also the problem that the
Impossible Whopper is topped with egg-based
mayonnaise.
That’s not vegan at all, but at least you
can ask for it to be left off.
This was potentially quite a swing-and-a-miss
for Burger King.
The fast-food giant presumably got lots of
vegans and vegetarians excited about a product
only to get it wrong in a way that could be
viewed as insulting.
Needless to say, some customers weren’t pleased.
“A vegan man is suing Burger King because
of the company’s wildly popular Impossible
Burger.”
“Yes, he says the ads for the burger are all
lies.”
Ad campaigns are supposed to make people want
to buy your product, not feel totally creeped
out.
Over the years, several Burger King ad campaigns
have managed to alienate customers, and no
wonder: The biggest offenders certainly aren’t
appetizing, to say the least.
Take, for example, a 2009 ad from Burger King
Singapore for the BK Super Seven Incher.
It’s not subtle and it’s definitely not tasteful
– particularly with that wince-inducing tagline.
And if you squint, you might be able to make
out the copy at the bottom of the ad, which
reads:
“Fill your desire for something long, juicy
and flame-grilled with the NEW BK SUPER SEVEN
INCHER.”
The model – who was never publicly named – reportedly
didn’t consent to appearing in the ad.
And she certainly wasn’t happy about it.
According to Fox News, she railed against
the campaign in a YouTube video that has since
been deleted, claiming:
“Burger King found my photo online from a
series I did, and with no due regard to me
as a person, profited off reducing me to an
orifice […] publicly humiliating me in the
process.
Friends, family, coworkers, prospective employers
who saw it assume I was a willing player.”
Meanwhile, the Russian branch of Burger King
also made a rather serious blunder.
In a 2018 tweet, Burger King Russia promised
free food for life and a cash prize for women
who took advantage of the World Cup – but
there was one serious catch.
Deadspin translated the since-deleted tweet
to read,
“Burger King […] has appointed a reward
for girls who get pregnant from the stars
of world football.
Each will receive 3 million rubles, and a
lifelong supply of Whoppers.
For these girls, it will be possible to get
the best football genes, and will lay down
the success of the Russian national team on
several generations ahead.”
Has the chain learned anything at all from
these misfires?
Perhaps not – because their ad campaigns keep
getting them in trouble.
In 2019, CNN reported that Burger King New
Zealand was under fire.
That’s because of an ad campaign that was
hocking the Vietnamese Sweet Chili Tendercrisp
burger.
As Eater reports, Burger King New Zealand
removed the ad from its Instagram account,
but you can still watch it on Twitter if you
know where to look.
As you can see, the insensitive commercial
features people trying to eat burgers with
chopsticks.
Not good.
Then again, sometimes Burger King’s risks
pay off rather fabulously – particularly their
sassy social media presence.
Take, for instance, this Twitter exchange
between Burger King UK and Kanye West:
“Kanye West tweets, ‘McDonald’s is my favorite
restaurant.’
Burger King with the troll move says, ‘Explains
a lot.'”
In early 2019, Burger King made a rather bold
move: The fast-food chain took on McDonald’s
Happy Meals.
That’s not a risky move in and of itself,
it’s how they went about it.
Burger King’s “Real Meals” were a moody satire
of Mickey D’s Happy Meals that heartily embraced
the fact that
“No one is happy all the time.
And that’s OK.”
The promotion included items like the Salty
Meal and the DGAF Meal.
And though their tongue was firmly planted
in cheek, Burger King’s campaign was nevertheless
designed in partnership with Mental Health
America, in honor of Mental Health Awareness
Month.
As CNBC reported, the promotion upset people
for a number of reasons.
Some accused the chain of using mental illness
to take a swing at a competitor and to turn
a profit.
Others pointed out that moods aren’t the same
thing as mental illness.
Even as some folks applauded Burger King’s
efforts to start an important conversation,
others condemned the chain for not going far
enough.
For example, why not offer resources for people
living with mental illness?
Why make it a one-off gimmick instead of a
legitimate ongoing effort?
Whatever your thoughts on the campaign, it
was no doubt a controversial move on Burger
King’s part:
“Some people will say, ‘Hey, Burger King doesn’t
belong in this conversation.
Hey this is private.’
But keeping these things private is where
we get into trouble in the first place.”
Ari Lightman, a professor who specializes
in digital media and marketing at Carnegie
Mellon’s Heinz College of Information Systems
and Public Policy, had this to say about the
campaign:
“If the general public finds out that your
actions don’t coincide with your messaging,
then that can be potentially very damaging
for a company.”
When was the last time you went to Burger
King for breakfast?
It’s been awhile, right?
Sure, the Croissan’wich is great, but the
coffee could certainly be better, and none
of it is enough to keep you coming back, unless
you happen to be this excitable young lady:
“Burger King’s got a delicious new way to
say good morning.
The Croissan’wich!”
“Cruh…?”
“Croi-ssan-wich!”
It sounds like Burger King is looking for
new ways to win over a solid breakfast crowd.
The fast food restaurant clearly wants people
to be thrilled about their early morning options,
like this guy:
“It’s morning / I’m hungry / Gonna go to Burger
King / Burger King for breakfast?
/ Yes, there’s such a thing!”
Well, that ad is evidently rather deceptive.
You see, according to Restaurant Business,
breakfast is a huge weak spot in Burger King’s
business plan.
When you look at the numbers, an average Burger
King makes about half as much as an average
McDonald’s when it comes to the most important
meal of the day.
Chris Finazzo, president of Burger King in
the Americas, seems to know that the chain
hasn’t effectively created a reason for people
to make BK breakfast part of their morning
routine.
In May 2019, he told Restaurant Business:
“Breakfast has been an opportunity for us
for a long time.
We haven’t been as successful as we could
be.”
Execs at Burger King seem well aware that
they need to improve their coffee game.
As Restaurant Business reports,
“[Burger King] started a coffee subscription
program, […] giving customers the opportunity
to get unlimited coffee for $5 a month.
It also started the BK Cafe, a platform with
upgraded beverages important to morning commuters.”
The chain really needs to get folks excited
about those Croissan’wiches if they want to
get anywhere near McDonald’s and their Egg
McMuffins.
Wooing a crowd away from Mickey D’s will be
hard, but it sounds like Burger King is really
going to give it a shot.
Millennials get blamed for pretty much everything
these days, but they’re obviously an important
demographic that’s shaping the way that companies
do business.
As Forbes reports, that’s certainly true of
the fast food landscape, but Burger King hasn’t
found new ways to appeal to the millennial
generation.
Some of their ad campaigns certainly seem
to be trying, though:
“This might be my new go-to.”
“That’s fantastic.”
“I have to catch my train.”
“I don’t so I’m gonna get another dip.
You feel me?”
“Do it!”
Here’s an interesting, and rather telling,
statistic.
From 2007 to 2014, Burger King saw a four
percent increase in their traffic.
That’s great!
What’s not so great is that during the same
period, they saw a five percent drop in traffic
in the category of low-income millennials.
As for high-income millennials, the change
was even more drastic: A 16 percent drop.
Burger King isn’t the only chain that’s been
struggling to reach millennials and get them
through the door, but the generation’s disinterest
in the Burger King brand is something that
really needs to be addressed if it wants to
stay relevant.
In May 2019, Burger King made an announcement.
According to the publication Restaurant Business,
“[The chain] wants to add more locations in
the U.S. and narrow its wide unit count gap
with rival McDonald’s.
So it’s closing restaurants.”
It’s an interesting tactical move on Burger
King’s part.
At the time of the announcement, the fast
food chain had around 7,300 locations in the
United States.
Compare that to the roughly 13,900 U.S. locations
that McDonald’s had at the time.
To get closer to McDonald’s numbers, Burger
King was going to close between 200 and 250
locations.
That’s a huge jump in closures, since Burger
King typically averaged about a 100 to 130-store
closure rate every year in the lead-up to
the announcement.
So, what gives?
First, these closures aren’t all going to
be happening at once.
Burger King says that, for the most part,
the restaurants will close on a rolling basis
as it comes time for franchisee contracts
to be renewed or terminated.
On average, Burger King stores slated for
closure make around $1 million a year in sales.
That doesn’t sound too shabby at first, but
when you consider that newer and more profitacvble
BK restaurants average about $1.5 million
annually, that really puts things in perspective,
doesn’t it?
Chris Finazzo, President of Burger King in
the Americas, put it this way:
“Closing low-volume restaurants creates a
virtual cycle of improved profitability.”
Don’t fret, Burger King fans – it’s not all
bad news.
There are plans to open new stores in place
of the locations that are closing.
And one person is particularly busy injecting
new life into the decades-old brand.
His name is Daniel Schwartz.
He was just 29 years old when he became Burger
King’s CFO.
By the time he was 32, he was named a chief
executive.
Now he’s the executive chairman of Burger
King’s parent company.
Essentially, his job is to make Burger King
cool again.
According to Forbes, he’s doing everything
right.
He’s streamlined food prep, sold off the corporate
jet, and encouraged employees to make free
international business calls via Skype.
He’s making smart moves left and right.
“The big transition in finance, you kind of
manage the business, in a company you have
to manage the people who then manage the business.”
Schwartz seems to have achieved the impossible:
In 2018, BK’s parent company, Restaurant Brands,
saw a 17 percent increase in revenue.
Meanwhile, Burger King stock has reportedly
been skyrocketing – and Schwartz has has been
giving plenty of middle managers their fair
share of them.
As Forbes reports:
“Nearly all 300 middle managers (average age:
37) own shares; at least 100 have become millionaires.
Schwartz is sitting on about $100 million
in stock and options.”
So, don’t despair: It’s not all doom and gloom
over at Burger King.
They may be closing stores and facing some
struggles, but don’t write them off just yet.
Check out one of our newest videos right here!
Plus, even more Mashed videos about fast food
are coming soon.
Subscribe to our YouTube channel and hit the
bell so you don’t miss a single one.

Leave a Reply

Leave a Reply

Your email address will not be published. Required fields are marked *