The option of having it your way wasn’t enough to bring hardy eaters into Burger King in recent months. According to The Wall Street Journal, a weak March sales report sent the fast-food giant’s stocks plummeting nearly 20% by the end of last week.
Part of the sales slump, according to the company, came from underperforming breakfast items. A rise in unemployment numbers meant fewer employed consumers grabbing breakfast on their way to work. In addition, CNNMoney.com reports some of Burger King’s recent ad campaigns have made consumers second-guess their Whopper-sized appetites.
On the flip side, McDonald’s has been posting sales increases in the last two months. In March, the company reported a 1.4% rise in sales for the month of February for restaurants open longer than 13 months. In Japan, McDonald’s sales hit an all-time high of 49,647 billion yen in March.
TPG Capital LP, Burger King’s parent company, was listed in Nielsen’s Top 10 Parent Companies list for advertising for quick service restaurants, spending $219 million on advertising between January and September 2008. However, McDonald’s Corp. was second on that list with a spend of $656.9 million.
Last Thursday, Burger King announced plans to “Beef Up” its 2010 ad budget to communicate the value of its items as well as to introduce new “flame-broiled” menu items.
“The company estimates between a 20% to 25% increase in its 2010 national media presence versus 2009 through the incremental allocation of restaurant level funds to the national level coupled with the current deflationary media buy environment,” said Russ Klein, Burger King president, global marketing, strategy and innovation. “We are confident that this increase will enable the brand to continue its record positive comparable sales growth trend.”
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