Brand Tactics: Taco Bell and KFC's Double Coverage
A regional joint promotion brings Taco Bell and KFC together, and may set a tone for the company going forward.
By Margaret Littman, Contributing Editor -- Chain Leader, 11/1/2007
 Taco Bell and KFC franchisees in the Northeast launched a joint promotion this fall centered on a commemorative cup and the chance to win Eagles season tickets.
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or a Philadelphia Eagles’ fan, the excitement for the new football season was the 75th anniversary of one of the NFL’s most fan-supported teams. But for those who watch the Super Bowl for the commercials rather than the game, the big news was Taco Bell and KFC’s first cross-branding promotion.
In several regional and national promotions, Taco Bell had diverse partners ranging from the Philadelphia Eagles to MTV to expand its marketing reach. The regional spot was the first co-branded advertising effort with Taco Bell and KFC, while an MTV campaign got kids in on the action.
With the Eagles and Pepsi, Taco Bell and KFC franchisees in the Northeast unveiled a joint promotion this fall centered around a 32-ounce commemorative cup co-branded with KFC, Taco Bell and Pepsi logos. The text on the cup, which is free with purchase, details the top 10 moments in Eagles’ history and has a code for a season-long sweepstakes. At the end of the campaign, one participant will win a grand prize: Eagles season tickets next year.
While the campaign is a regional one driven by local franchisees, it underscores the chains’ national efforts to build the brands among their core demographic of 18- to 34-year-old men by reaching out to them in different ways. A 30-second TV spot highlights Eagles games and directs consumers to the chains and the NFL team’s Web sites. Point-of-purchase materials offer details.
With access to the marketing objectives and budgets for both Taco Bell and KFC, LevLane, a Philadelphia-based ad agency, developed the promotion that brought the two brands together in advertising the way they are together under the roofs of their many co-branded units.
"Neither the local KFC nor the local Taco Bell advertising co-op could have done this on their own," says Chris Ponzio, senior vice president and account director at LevLane.
LevLane has handled the marketing and advertising for KFC in the Northwest for nearly 25 years and won the Taco Bell business a year-and-a-half ago.
Quenching Consumer Thirst
The three-year agreement targets the heavy fast-food user that both chains covet. In addition, the chains are hoping that the promotion will increase beverage sales.
Beyond having a hoped-for immediate sales boost, Taco Bell Field Marketing Manager Janice Haggerty, who oversees the brand in the Northeast, says the co-campaign will help raise awareness of the objectives of the co-branded units. Nearly one-quarter of the Taco Bell and KFC units in the greater Philadelphia area are multibranded.
"The consumer does not understand what the multibrand is," Haggerty says. "It is one of our core initiatives."
By putting Taco Bell and KFC under one roof, parent Yum Brands is working to build the "fourth meal," late-night dining. It is yet to be determined whether other local markets, or Taco Bell nationally, will launch similar co-branded ads, but it is likely given the chain’s reliance on the dual units going forward. The majority of the chain’s 750 new units planned for 2008 will be multibranded. In addition to KFC, Taco Bell units may be combined with other Yum brands including Long John Silver’s and Pizza Hut.
"Multibranding is one way that Taco Bell gains a competitive edge by offering branded variety to our guests, and our customers love having added choices with two menus to choose from," adds Martin Hennessy, senior director, brand communications for Taco Bell. "It’s also a cost-effective solution in markets that may not have enough population density to support a single brand."
Virtual Video
The Philadelphia Eagles promotion is not the only way in which Taco Bell is seeking to attract new customers. In September, the chain unveiled the results of an online competition in a commercial that aired during the 2007 MTV Video Music Awards.
For two weeks in July, Taco Bell encouraged consumers to create an avatar—an animated character that represents a person on the Internet—and audition for the 30-second ad with an enter-to-win TV spot aired on the MTV networks. The campaign was held in conjunction with Menlo Park, Calif.-based Gizmoz, a firm that creates photorealistic animation for the Internet. Taco Bell received 1,400 virtual auditions and selected three winners. The video clips were watched 920,000 times; consumers who checked out the Taco Bell VMA site stayed on the site an average of 9 minutes.
Airing the ad during the awards show helps build awareness of the fourth-meal period with the young side of Taco Bell's target demographic, says spokesman Rob Poetsch. "There has been a lot of buzz around consumer-generated media, and we wanted to develop a campaign around that," he says.
Overcoming Obstacles
These buzz-worthy efforts may help turn around what Argus Research and other analysts predict will be a softer than usual year for Taco Bell. In February, news reports showed a Taco Bell and KFC co-branded unit with a rat infestation, prompting the closure of 10 franchised units. This followed at least 71 Taco Bell customers infected by E. coli bacteria late last year, leading to the closure of almost 90 units. While the brand continues to expand aggressively, the two events slowed sales.
Adds Hennessy: "Although using avatars was a different execution from our traditional food spots, it followed the same filter that all our ads do: It must be innovative and elevating, and it should reward the viewer with some entertainment value."
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