Dive Brief:

• KFC on Monday announced it is offering a value menu through the end of 2024 featuring a $4.99 two-piece chicken meal for one; a variably priced four-piece, two-person chicken meal; and a $20 six-piece chicken family meal. The menu is called “Taste of KFC Deals.”
• The two-piece meal includes a chicken thigh, drumstick, a side of mashed potatoes and a biscuit. All three value meals exclude the drinks usually included in KFC’s combo meals.
• KFC framed the long-running pricing deal explicitly as a response to consumer pullback due to menu price increases.“It's been 30 years since food ate up this much of people's incomes, and 56% of consumers are budgeting their finances more now due to inflation,” the chain said, citing U.S. Agriculture Department data.

Dive Insight:

The depth of the discounts in question and the longevity of the promotion signal the importance of value to Yum’s U.S. strategy for KFC. In Q4 2023, Yum saw flat same-store sales at its KFC U.S. locations, which comprise 15% of its global KFC system, according to its earnings report. Yum is likely hoping this promotional program will get more customers through the door.

To establish a baseline for the significance of this discount, Restaurant Dive compared the $4.99 two-piece deal to the price for a pickup order for a 2-piece combo at a Maryland KFC. The combo price is $9.99, but includes a drink, priced as a standalone item at $2.99. The price for the food items in the standard two-piece combo is $7.00, compared to $4.99 for the new value deal.

The price difference between the two meals ($2.01) represents an approximately 29% discount. The discounts on the two-person and family value meals are more difficult to measure because of the variable price of the former and the fact that KFC does not usually offer a six-piece meal. The chain’s standard, eight-piece meal is priced at $32.99, not including drinks.

The chain is also launching a “$10 Tuesdays” promotion, offering an eight-piece chicken bucket — usually priced at $19.99 as a standalone item — for $10, or a roughly 50% discount. KFC noted, however, that prices for and participation in the offering will vary across markets and on third-party ordering platforms.

To promote widespread use of Taste of KFC Deals, the chain is offering it at its stores, through its app and through its website. Earlier this year, Yum launched a points-based loyalty program for KFC, which gives the brand another traffic-driving tool.

According to Circana’s measurements, traffic across the industry is 8% below pre-pandemic levels. The QSR segment has turned back toward the value menu as a traffic booster in recent months. Taco Bell, also a Yum brand, launched a limited-time value menu earlier this year. Papa Johns’ $6.99 Papa Pairings launched in September 2022 and helped prop up traffic for the pizza brand.