How Fast-Food Chains Cook Up New Menu Items
Franchises are constantly looking for the next Egg McMuffin—but often get the next Pastrami Burger
When it comes to introducing new menu items, fast-food chains say it’s important to keep one basic truth in mind: For every Egg McMuffin, there are plenty of Pastrami Burgers.
That is, for every idea that works, there are hundreds that fail to hit the mark. The Egg McMuffin, an item created by a McDonald’s franchisee, is the quintessential success story: After its launch in 1972, it not only became a big seller, it also helped establish McDonald’s as a go-to place for breakfast. (And it eventually spawned a whole breakfast-sandwich industry: Can you say Waffle Taco?)
By contrast, the Pastrami Burger, an item introduced last fall by the Back Yard Burgers chain, had a lifespan of just eight weeks. “I enjoyed the product a lot, but it did not resonate well with our consumers,” says company CEO David McDougall.
Indeed, chains say it’s very rare for a product to make it past the testing stage. Yet, the chains test—or, at the very least, consider—scores of items in any given year. The reason they’re willing to take such chances is because of what’s at stake: Americans spent $274 billion eating at the top 500 chain restaurants in 2014, according to market researcher Technomic. And the industry has become highly competitive, with fast-casual chains like Chipotle , Five Guys and Panera Bread increasingly vying for consumers’ attention. Consider that industry giant McDonald’s saw its sales decline by 1.1% last year while such upstarts as BurgerFi and Habit Burger Grill saw increases of 111% and 46%, respectively, according to Technomic.