Talking All-Natural Fast Food
I was invited over to FOX Business once again, this time to appear on The Willis Report. The topic was the recent moves by Yum! Brands to serve all-natural ingredients in their products served at Taco Bell and Pizza Hut restaurants.
There's not doubt why the move is happening now. Pressure from activists aside, the economy is good at the moment, so with fuller wallets people are choosing healthier eating options. This has led to a slide in the entire Fast Food category. Taco Bell alone was down 8% in earnings per store in Q1. While not a precipitous decline, it does signify a trend that the brand must address.
My question is whether there will be real follow-through. With forecasts showing another market downturn in the next year or two, there will be no real need to make products healthier and, as a result, more expensive. Fast food is driven by the economics of the individual. People say in surveys they care about what they eat, but in practice if times are tough the only consideration is whether $30 will feed the entire family. This is the reason that fast-fooders like McDonald's always do well in down economies, while sales slip in good economies.