The Taco Bell unit of Yum! Brands Inc. (NYSE: YUM) has begun home delivery in a number of metros. The fast-food business becomes more competitive by the hour as chains alter their menus and store hours.
According to Taco Bell management:
Taco Bell delivery is rolling out to select markets through a partnership with on-demand delivery service DoorDash. The delivery service will be available in over 90 cities and more than 200 restaurants throughout the Los Angeles, Orange County, San Francisco Bay Area and Dallas regions. The partnership provides delivery service beginning today through the DoorDash iOS, Android or website. Pricing and delivery costs may vary depending on restaurant location.
The app angle makes the smartphone crowd’s participation easier, although most smartphones are already loaded with scores of applications. One more represents a hard sell.
Taco Bell’s decision challenges the pizza business more than any other. Taco Bell CEO Brian Niccol said:
Delivery is yet another example of how we’re using technology and innovation to respond to consumers’ wants and needs, further evolving the Taco Bell experience for customers. We were one of the first to redefine convenience at QSR with our mobile app, and knowing that delivery is the no. 1 request from our consumers, we see a tremendous opportunity to bring the Taco Bell experience to fans where and when they want it most. Taco Bell has always been about value and convenience, and we believe delivery is the next step in catering to today’s on-demand culture that’s driving consumer behavior.
Fast-food companies like McDonald’s Corp. (NYSE: MCD) and Subway have made no real push into home delivery. Their market research must show the market has tight limits.
The fact of the matter is that Taco Bell’s new initiative mirrors the one the pizza industry has relied on heavily for years. That means Pizza Hut has to rely on home delivery as critical to its product advantage. Taco Bell may become Pizza Hut’s largest enemy.
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