Why fast food breakfast is booming

Food chains are seeking to raise the bar on breakfast as McDonald's and others revamp their breakfast menus.

McDonald’s upcoming October 6 introduction of a limited all-day breakfast menu has not just other QSRs but also mid-price family concepts scrambling to defend their breakfast turfs. The NPD Group reported that breakfast has been the fast growing daypart, with a 4% increase in customer counts during the 12 months ended May 2015. No chain wants to lose its momentum in the mornings.

McDonald’s hopes to tap that rising popularity; competitors are moving to keep what they have.

Known itself as the “restaurant born on a farm,” new ads from the Bob Evans family-dining chain announce it is “raising the bar on breakfast” with 10 Specialty Breakfasts priced under $6. Last month, Bob Evans’ Executive Chair Doug Benham told analysts its menu strategy “is currently focused on higher margin breakfast items as part of our Best in Class Breakfast initiative.” Breakfast now represents 40% of its sales and Benham wants it higher. To do so it will “deemphasize the lower margin items such as three-course dinners on our lunch and dinner menus.”

Shoney’s is touting a $5 “All-Star Breakfast” with “two freshly cracked eggs,” crispy bacon, breakfast potatoes and buttermilk biscuit. Since McDonald’s also freshly cracks eggs in-store, this benefit (also cited in ads for Bob Evans and others) has power mostly against the likes of Taco Bell, which doesn’t use fresh eggs.

IHOP is promoting Double Dipped French Toast, which it gleefully describes as “breakfast dipped in breakfast.” Perkins Restaurant & Bakery has a new Griddle Up Menu with five platters including a Pumpkin Spice Oatmeal Pancake Platter. Village Inn positions its breakfast menu as “crave-worth choices all day every day.” Buffet concept Golden Corral is pushing “Breakfast for Lunch and Dinner 7 Days a Week” with made-to-order omelets in new commercials featuring comic/actor Jeff Foxworthy.

Over the past five years, customer traffic at family-dining restaurants has declined 3% according to NPD data. But while other dayparts slide, family-segment customer counts at breakfast are at least flat, making it these concepts’ most important segment.

QSRs are just beginning to put up new defenses. Taco Bell this week broke a new TV spotfor its Bacon, Egg & Cheese Biscuit Taco. Carl’s Jr./Hardee’s last week enlisted UFC Bantamweight Champ Ronda Rousey to promote their latest breakfast item, the Cinnamon Swirl French Toast Breakfast Sandwich. Dunkin’ Donuts has introduced a Tailgater Breakfast Sandwich with a split smoked sausage atop grilled pepper strips and an egg.

Krystal suddenly is promoting a “$3.99 Three-Egg Breakfast with Fresh Cracked Eggs.” Expect to see more such defensive marketing; I wouldn’t be surprised to see a new breakfast item soon from Jack in the Box, which hasn’t augmented its morning menu since the Steak & Egg Breakfast Burrito in May.

McDonald’s Family Duo Meal in Canada

Even McDonald’s is making changes. It is reverting to the original-style English muffin it previously used for McMuffins and is again dressing the muffins with butter rather than margarine. The chain also announced that over the next decade as supplies allow, it will transition to using only cage-free eggs.

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In Canada, McDonald’s is offering a new twist on the multi-person boxed meal. The “Family Duo Meal” doesn’t come in a box, but for $10 it includes an entree salad for a parent coupled with a Happy Meal for a child.

The chain added a new line of Entrée Salad Bowls–each with baby kale as an ingredient–in May in Canada. It introduced them with TV spots showing unsuspecting patrons at a “Salad Society” pop-up restaurant trying the salads without knowing they’re from McDonald’s. As I reported last week, this “This is McDonald’s?” tactic is being used by the chain worldwide as it works to change perceptions of the brand.

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Culver’s launched its “Thank You, Farmers” initiative in 2013. The goals are to thank farmers who supply the chain with foodstuffs and to provide some money for the FFA organization that supports young people who want careers in farming. This year’s thank-you is a really big one: Culver’s cut a maze into Gull Meadow Farm’s cornfield in Richland, Mich. From the air you can see the logos for both Culver’s and its “Thank You, Farmers” program. The maze will be there through November 1.