• Taco Bell relies heavily on new menu items.
  • The chain has been a sales driver for Yum Brands.
  • Yum is adding new Taco Bell locations.

Taco Bell might not have the cache of Chipotle, which many people think of as elevated fast food, but it’s a sales giant for parent company Yum Brands.

“Taco Bell’s recent success is no accident – it’s smart, targeted marketing. They’ve mastered limited-time offers that create urgency, like the ‘Bajaversary’ for Baja Blast, which pulled in customers and spiked visits,” Paul Drecksler, an e-commerce expert and founder of Shopifreaks, told The Food Institute.

Another industry expert, Organic Solace CEO Ken Tobby, said the Mexican chain’s LTOs help fuel its success.

“This approach usually brings about repeat visits and sales spikes, as people do not want to miss out,” he shared.

The chain has also scored with its affordable menu items at a time when consumers are demanding them.

“Taco Bell’s affordability strategy has become a lifeline for budget-conscious consumers. Items like $2 burritos and $1.49 breakfasts have positioned the brand as a go-to option during economic uncertainty,” wrote Clyde Morgan for AInvest.com.

Taco Bell drives sales

Yum Brands CEO Christopher Turner highlighted Taco Bell’s success during his company’s third-quarter earnings call.

“At Taco Bell, which represents 36% of our divisional operating profit, same-store sales grew 7%, reflecting continued progress on the journey laid out at the Taco Bell Consumer Day to drive $3 million U.S. average unit volumes by 2030,” he shared.

That success, he pointed out, was driven by new offerings and the chain’s app.

“Innovation, distinctive value offerings, and digital engagement drove this remarkable performance,” he added.

More Restaurants 

  • Scandals force fast-food chain to close dozens of restaurants
  • 30-year-old pizza chain closes all restaurants except one
  • Texas Roadhouse rival shuts down several restaurant locations

Taco Bell’s innovation wasn’t limited to food, although it does add a new menu item every five weeks.

“In the U.S., Taco Bell introduced innovation-led buzz like the Tony Hawk and Bad Birdie collaborations, compelling value like the $3 Grilled Steak Burrito, and expanded its beverage platform with the launch of Refrescas and Baja Blast Midnight,” he shared.

Digital mix hit another record and digital sales grew 28% year over year.

Adding chicken nuggets has been a driver for Taco Bell.

Taco Bell

Taco Bell third-quarter highlights

  • Taco Bell Division opened 74 gross new restaurants across 14 countries.
  • Taco Bell U.S. company-owned restaurant margins were 23.9%, a 50 basis point year-over-year increase.
  • Taco Bell U.S. system sales grew 9% and Taco Bell International system sales, excluding foreign currency translation, grew 12%.
  • Taco Bell U.S. same-store sales grew 7% and Taco Bell International same-store sales grew 6%.
    Source: Yum Brands

Yum Brands has more planned for Taco Bell

Turner made it clear that Taco Bell planned to lean into what’s already working.

“Next year, the U.S. team will add more weeks of crispy chicken, fries, and beverages to expand everyday occasions, balanced with a refreshed cravings value menu and elevated guest experience,” he said.

The chain has also been growing both domestically and globally.

“At Taco Bell, development accelerated this quarter with 74 gross unit openings, well above Q3 levels of last year. Taco Bell International continued to build momentum, adding 27 gross new units and successfully launching 2 new markets, Greece and Ireland,” the CEO added.

More growth is ahead for the chain.

“On the back of accelerating sales, we remain on track to deliver 100 international net new units this year, reflecting energized franchise partners, compelling brand marketing, and improving unit-level economics around the world,” Turner shared.

Financial planner Steven Kibbel, chief editorial adviser at Gold IRA Cos, believes Taco Bell’s success comes from its ability to innovate while maintaining value.

“They’re quick to adjust to trends with items that appeal to budget-conscious consumers, which helps sustain growth in a tough market,” Kibbel told The Food Institute. “It’s not just the novelty factor, but also the efficiency in their operations and pricing strategy that helps them stay competitive.”