Will Taco Bell lovers sign up for a taco a day?

Discussion
Source: Taco Bell
Sep 20, 2021

Taco Bell is testing a one-month subscription program, Taco Lovers Pass, offering one taco per day.

The chain is trialing the program at 17 restaurants in Tucson, AZ. The monthly cost ranges from $5 and $10, depending on the location. Consumers can purchase the pass on the Taco Bell app and then access a menu of daily tacos. The seven currently available, including the Doritos Locos Taco and Crunchy Taco Supreme, are normally priced in a range from $1.49 and $2.89.

Redemptions are only available through the app. The program is running from Sept. 9 to Nov. 24.

The test comes on top of the 2020 launch of the Taco Bell Rewards loyalty program that lets members earn points for purchases. David Gibbs, CEO of Taco Bell’s parent YUM! Brands, said on a recent quarterly call that the program is driving “significant uptick in frequency and higher spend per visit.”

It’s unknown whether the Taco Bell subscription program is seen by the fast-feeder as a limited-time or everyday promotion.

Among limited-time offers, among the best known is Olive Garden’s which offers seven weeks of Never Ending Pasta Bowls for $100 per pass. The brand introduced the program in 2014 to great fanfare and has periodically brought it back to quick sellouts. Last fall, the Italian restaurant chain sold 21,000 passes. Smashburger and Red Robin have offered burger passes in limited-time promotions.

Among those with all-year subscriptions, Panera has earned the most attention for its launch in February 2020 of an $8.99 monthly program offering customers a free hot or iced cup of coffee  which can be redeemed as often as every two hours, any time of the day. Restaurant Business reports the program generated nearly a half million paid subscribers about seven months after launch with 35 percent of those in the program considered new Panera customers. About 35 percent of the time those redeeming their free beverage also bought food.

Circle K introduced a $5.99 monthly plan in May that offers a daily beverage. Pret A Manger is rolling out such a program in New York and Washington D.C. after finding success in the U.K. Many local establishments have subscription programs around coffee.

DISCUSSION QUESTIONS: Do you think a daily taco subscription program will be attractive to Taco Bell’s customers and beneficial to franchisees and the chain? Do you see the program having more value as a limited-time promotion or as part of Taco Bell’s day-to-day business?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"Food related subscription plans are like gift cards: the majority of people redeem them for more than face value... This a straight up money maker for Taco Bell."
"This is why I like looking to the QSR space for retail best practice inspiration."
"Absolutely, Taco Bell is definitely thinking outside the bun."

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13 Comments on "Will Taco Bell lovers sign up for a taco a day?"


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Georganne Bender
BrainTrust

If you are on a limited budget, or just love tacos, then this is a great way to go.

Food related subscription plans are like gift cards: the majority of people redeem them for more than face value. Who’s going to order a taco without a drink? This a straight up money maker for Taco Bell.

Gary Sankary
BrainTrust

Interesting idea. I am 100 percent confident that there is a population of Taco Bell customers that will eat this up.
Seriously though this sounds like a great idea for driving loyalty, generating more use of their app and providing real value for their customers. According to the article a taco is about $1.49, so even at $10 it’s only a bit more than a weekly trip to Taco Bell. I think this will be very popular.

Bill Hanifin
BrainTrust

The daily taco subscription will drive additional visits and sales, plus some breakage for the company. I’m not sure of the economic arrangement between corporate and franchisees, but I assume they will each benefit from the subscription funds.

We don’t have to answer the question of whether customers will buy one taco every day. But the fanatical patrons will see an opportunity to get a deal on their favorite food items and will probably stop by for an additional visit or so each week.

I would guess this campaign is time-limited in nature and that after assessing the results and impact on the business, Taco Bell will decide what the next phase of subscriptions will look like.

Venky Ramesh
BrainTrust

Absolutely, Taco Bell is definitely thinking outside the bun. More than people buying a taco subscription for themselves, Taco Bell should position this as a gift option to give to your loved ones who love tacos. That, IMO, will drive higher sales. Not just for tacos but everything else a customer is tempted to buy when they are at the restaurant.

Rich Kizer
BrainTrust

Sounds like the Panera coffee promotion, which my neighbors tell me is very successful.

Steve Montgomery
BrainTrust

For Taco Bell lovers this will be a big hit. They will increase their visit frequency and as Georganne pointed out none are likely to leave without a drink. The impact on the profitability for the franchisees will be dependent on the basket margins.

Georganne Bender
BrainTrust

T. Scott Gross calls those $1+ cups of sugar water a “Happy Boss.” Pure profit!

Richard Hernandez
BrainTrust

I think this is a great idea – there is definitely an audience for this. Let’s hope this works for them.

Mohamed Amer, PhD
BrainTrust

Promotions, regardless of the shape they come in, are more effective if they provide a longer-lasting effect. Do they add on sales, or generate greater visit frequencies or larger tickets? For Taco Bell, the company may also be pursuing lower order costs and streamlining store execution by dedicating the transaction to their mobile app. Taco lovers will not be able to resist!

Ryan Mathews
BrainTrust

Will it work in the short term? Probably. Is it sustainable? Would you like to eat one Taco Bell taco a day in perpetuity? On the other hand, if they are using it as bait for a loyalty program I give them high marks. So put me firmly in the limited-time promotion camp.

Melissa Minkow
BrainTrust

This is why I like looking to the QSR space for retail best practice inspiration. Creating app-exclusive, ongoing perks is a brilliant way to drive app downloads and usage. It would be wise of Taco Bell to make this an indefinitely available service in order to maintain app usage after download. I hope to see retailers thinking through innovative app-exclusive perks like this.

Doug Garnett
BrainTrust

Some customers will benefit. But this is likely to end up a lot of work for little payback for Taco Bell. Unfortunately, reward and membership approaches are somehow assumed to be productive despite research showing they often aren’t.

Retailers need to be careful — understand exactly why people might increase their purchases and understand that it likely appeals to a very narrow audience. Retailers also need to respect that programs like this often decrease per purchase revenue from customers who are already quite loyal — without increasing overall purchases.

Casey Craig
BrainTrust

They will absolutely sign up. Great idea to promote customer engagement with the brand while increasing app usage. Looking forward to seeing the results.

wpDiscuz
Braintrust
"Food related subscription plans are like gift cards: the majority of people redeem them for more than face value... This a straight up money maker for Taco Bell."
"This is why I like looking to the QSR space for retail best practice inspiration."
"Absolutely, Taco Bell is definitely thinking outside the bun."

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