Over the last few years, fast food chains like McDonald’s and Taco Bell have invested heavily in breakfast menu items in order to drive up morning sales. This strategy worked for a while as breakfast sales continually increased from previous years and chains poured millions of dollars into marketing the so-called “most important meal of the day.” But like so many other previously successful ventures, the coronavirus pandemic has taken a major toll on the breakfast business.
Morning drive-thru traffic has dropped dramatically as many Americans continue to work and attend school from home. In April, breakfast transactions at fast food restaurants dropped by a whopping 54 percent. While sales have recovered since then, they remain far below last year’s levels. McDonald’s CEO Chris Kempczinski said that breakfast has significantly dragged down sales during the pandemic as commuters largely remain absent from roads and drive-thru lines. Matters are even worse for breakfast-focused chains like Dunkin’ and IHOP, which have both recently announced that they will close hundreds of locations due to falling sales.
IHOP had even been planning to launch a new fast-casual brand called Flip’d that would focus on serving pancakes to busy customers on the go. With that concept on hold, though, the chain is now using discounts to entice eaters for the first time in its history. As restaurants like IHOP struggle, sales for cereal and ground coffee brands have skyrocketed after millions of Americans changed their eating habits during the pandemic. “We are in a position to own breakfast,” said U.S. president of Kraft-Heinz Carlos Abrams-Rivera, makers of products like Oscar Meyer bacon and Maxwell House coffee.
Questions:
- How did the pandemic change breakfast sales at fast food chains like McDonald’s and Taco Bell?
- Do you think breakfast-focused chains like Dunkin’ and IHOP will be able to survive the pandemic? Why or why not?