THE BREAKFAST CLUB
Fast-food giants are fighting for the caffeine crowd’s cash,
Doug Fisher tries to steer clear of fast food for breakfast, but once in a while, when he racks up enough reward points at Starbucks, he has one of their decadent egg sandwiches.
“My wife doesn’t want me to go to McDonald’s, but the bun on this sandwich had a lot of oil and butter in it,” jokes the president of food-service consultancy firm FHG International Inc. in Toronto.
Like many people, Fisher gets his morning coffee on his way to work.
He is tempted by the familiar sandwiches on offer, along with all the new ones that keep popping up.
“Breakfast is a hot item, and it’s an open market,” he says.
The giants are locked in a battle for your breakfast business. Fisher says they’re all trying to lure you away from top player Tim Hortons, the largest restaurant chain in Canada. Tims has more than half the morning market share among “quick-service” chains.
Breakfast accounts for 27 per cent of all fast-food revenue, up from 20 per cent last year. According to research firm NPD Group, the morning meal (breakfast and early snack) actually surpassed lunch in 2014 as the industry’s biggest business “day part” in Canada.
It accounts for 35 per cent of all fast-food traffic, compared to 25 per cent at lunch, says NPD.
“It’s really the only area of growth,” says Robert Carter, NPD’s executive director of food service.
Most of the giants have launched new breakfast menu items recently that are aimed at both ends of the market.
They range from so-called healthy fast food to traditional, higher-calorie fare, says marketing professor Ken Wong at the Smith School of Business at Queen’s University.
“Millennials are a little more health conscious and so are the boomers, out of necessity,” he notes. “But there’s always going to be people who just want the greasy stuff,” Wong says.
The Egg McMuffin, which was introduced in Canada in 1976, is still among the lightest menu items out there, at 290 calories. Tim Hortons offers some brekkie sandwiches under 300 calories, while others are about 500 calories. At the other end of the scale, Burger King’s Enormous Omelette Sandwich weighs in at 750 calories.
Fisher points out that most chains are focused on making breakfast portable since a majority of the business is at the drive-thru. But no one is reinventing the wheel, he says.
“They all copy each other,” says Fisher.
“Everyone has a wrap or a burrito or a smoothie now,” he says.
McDonald’s has been the most successful at stealing market share from Tims, with its wildly popular coffee and McCafe offerings, Fisher says.
“We’ll continue to see breakfast as a battleground in quick service,” adds Carter.