During the company’s earnings call, CEO David Gibbs said Saucy will expand dramatically this year as a potential play for the KFC U.S. long-term business
Yum Brands is going all in on concepting, as evidenced by the recent launches of Saucy by KFC and Taco Bell’s Live Más Café, both of which are now single-unit tests.
Saucy made its debut in Orlando, Fla., in December and features a simple menu of chicken tenders, 11 different sauces, 11 different beverages, coleslaw, fries, and toasted Hawaiian rolls. During Yum Brands’ earnings call Thursday, chief executive officer David Gibbs said early engagement has been “promising, reinforcing our belief in Saucy’s potential to drive sales and enhance brand relevance.”
Live Más Café also opened in December inside a traditional Taco Bell restaurant in San Diego. The café includes specialty drinks like Chillers, Agua Refrescas, coffees, and more, alongside traditional Taco Bell menu items. The company describes it as "a unique experience where fans can enjoy specialty drinks ... This café redefines the Taco Bell experience with an innovative beverage lineup and Bellristas providing exceptional flavor and hospitality in a cozy, inviting atmosphere, all while maintaining the great value customers love."
Gibbs said consumer response has been strong, while the concept has driven meaningful, incremental sales.
Expect more of these two new brands this year.
“These innovations reflect our commitment to staying ahead of consumer trends, enhancing brand differentiation, and creating new avenues for growth. While these are only one-unit pilots today, we plan to expand both test concepts this year to better understand their long-term growth potential and role in our portfolio,” Gibbs said.
Of course, such concepting isn’t new to either brand or to parent company Yum Brands, which has launched fast-casual spinoffs like K Pro in China. Domestically, sometimes they work out and sometimes they don’t.
Yum spun off the Vietnamese-inspired Banh Shop in Dallas in 2014, for instance, which closed in 2017 after it was acquired by an investment group. Yum also spun off Super Chix, before selling it in 2015 when it had two locations. It now includes more than 30 locations with several more listed as “coming soon” on its website.
Yum’s Taco Bell brand tested U.S. Taco Co. and Urban Tap Room in 2014, featuring premium tacos, spicy steak-cut fries, and alcohol-infused shakes. The fast-casual spinoff lasted about a year before closing, facing challenges in obtaining a permanent alcohol permit. That said, Taco Bell’s CEO at the time – Brian Niccol – said the test allowed the flagship chain to test and learn restaurant design and kitchen layout elements, as well as menu innovations.
On the heels of its closure came Taco Bell’s Cantina, making its debut in 2015, initially focused on urban locations and featuring a tapas-style menu and cocktails. There are now about 50 Cantina locations throughout the country.
KFC has also experimented with spinoffs before, launching fast casual concept KFC Eleven in its hometown of Louisville, Ky., in 2013. The restaurant – which KFC said provided menu, design, and service learnings to its parent company – closed in 2015.
Obviously, it’s too early to understand what Saucy or Live Más Café will become, but what we do know now is that Yum is bullish on both. Gibbs even identified Saucy as one of the catalysts for KFC’s turnaround in the months ahead as the domestic system continues to struggle with mid-single-digit same-store sales declines.
“We’re going to expand that test pretty dramatically this year to try and get a better read on how that solution would play for the KFC U.S. long-term business,” he said.
During a recent interview, KFC U.S. president Tarun Lal said as Saucy expands, there will be different iterations of the concept.
“We will read into how our customers and team members use the brand and polish it while scaling,” he said. “The plan is to grow more stores to understand the concept.”
Contact Alicia Kelso at [email protected]
You May Also Like
