Burger Giants Follow Panera and Subway Toward Upscale Fare
The big three burger giants are stealing a page from the menus of their fast-casual competition.
McDonald's (MCD), Wendy's (WEN), and Burger King (BKW) have been rolling out new sandwiches this month that will pit them against Subway, Panera Bread (PNRA), and perhaps even that gourmet burger joint down the road.
Artisan breads, calorie counts, and more non-beef options are among the latest things the chains are introducing to woo in the customers who have been flocking of late to their marginally more upscale rivals.
Meet the New Menu Items
Wendy's is introducing a pair of flatbread grilled chicken sandwiches. Flatbread is an option that most people will associate with Subway, but Wendy's going a step further. Its flatbread is a five-grain blend of flax, cracked wheat, millet, rolled oats, and sesame seeds that would look more at home on Panera's menu.
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McDonald's is also aiming at Subway's niche with its new Premium McWraps. The world's largest burger-flipper has offered Snack Wraps before, but the new menu items are built on larger flour tortillas, with more grilled or fried chicken and salad greens. An internal memo leaked to Advertising Age called the addition a "Subway buster" -- but naturally we'll have to see about that.
Over at Burger King, they're now offering turkey burgers as an alternative. Burger King has offered a veggie burger in the past, but this is the first time that one of the three leading hamburger chains has tried turkey burgers, though they are frequently on the menus of gourmet burger eateries that can afford to stock wider selections.
Healthy Moves are Stealthy Moves
Menu development at McDonald's, BK, and Wendy's never stands still: The chains are perpetually introducing new items and retiring less popular options to keep generating interest. However, it's no coincidence that all three are expanding their now menus with entrees feel cribbed from the menus of fast casual chains. It's probably also not a coincidence that many of these new additions are healthier than the typical fare being flipped at the chains. As consumers grow ever-more health conscious, and labeling requirements become more common, the chains are finding it wise to offer alternatives to their less healthy signature sandwiches.
The Smoky Honey Mustard flatbread at Wendy's packs a modest 370 calories. The sweet chili version of the Premium McWrap made with grilled chicken weighs in at an even slimmer 360 calories and a reasonable 9 grams of fat. BK's turkey burger isn't exactly healthy, with 26 grams of fat, though its 5 grams of saturated fat makes it half as bad as the traditional Whopper on that front.
Bringing it All Home
A new Wendy's ad pitches the convenience of picking up one of its flatbread sandwiches.
"Didn't even have to get out of the car," the chain's current redheaded pitchwoman tells a pair of harried moms at a playground -- a jab at the lack of drive-thru windows at most Subways and Paneras.
On the other side of the adaptation equation, fast casual is starting to acquire the tricks of its fast food foes. Even Starbucks (SBUX) is committing to opening more drive-thrus for customers who don't want to get out of the car to satisfy their latte fix.
As consumers, we may find ourselves faring a little bit better during our next annual physicals thanks to fast food's embrace of "better for you" menu options. As investors, if burger chains can legitimately move toward higher-priced fare that's still perceived as a value by patrons, we can reasonably expect healthier returns as well.
Motley Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends Burger King Worldwide, McDonald's, Panera Bread, and Starbucks. The Motley Fool owns shares of McDonald's, Panera Bread, and Starbucks. You can try any of our newsletter services free for 30 days.
