Taco Bell recently announced its intention to discontinue kids’ meals, effective immediately at some locations and in early 2014, at others. Though some health food advocates are applauding Taco Bell’s move, the shift isn’t actually an attempt to make a health statement — kids’ meals are simply not lucrative.
In the press statement, Taco Bell said that “kids’ meals are not part of Taco Bell’s long-term brand strategy and have had an insignificant impact on system sales.” USA Today reports that kids’ meals accounted for just .05% of Taco Bell’s annual sales.
Regardless of the reason, Taco Bell is one of the first major fast food chains to move away from the very big business that is fast food kids’ meals. According to the Federal Trade Commission report “Marketing Food to Children and Adolescents: A Review of Industry Expenditures, Activities, and Self- Regulation” quick service restaurants (QSRs) spend about $583 million marketing to youth each year. The return on investment? The data confirms that about $1.2 billion meals are sold annually to kids under the age of 12, accounting for 18% of all QSR visits.
Clearly, there’s a profitability aspect to kids’ meals. But exactly what role do kids’ meals play in growth strategies for QSR brands? Continue reading . . .