Fast-food chains are struggling in this current US economy — but Taco Bell has a 'magic formula'
2025 was not a great year for fast food chains across the country, as, apart from November, every month reported declining traffic in the big outlets. The only brand that has had a year they could be proud of is Taco Bell. What’s great about its story is that it didn't go the route most fast-food chains take when faced with declining footfall: offering big discounts on popular items.
The likes of McDonald’s, KFC, Pizza Hut, and Popeyes all struggled through the year. McDonald’s extended its $5 value meal offering and added a buy-one-get-one value meal deal, according to an Inc. report. However, it did not translate into profits. There was an uptick in sales, but the company was struggling to make money off its sales. Taco Bell, on the other hand, has introduced new, value-focused menu items, like the new Luxe Value Menu, featuring new items like the Mini Taco Salad, all under $3.
"When you look at being a buzzy brand, you look at value, you look at digital, you look at category entry points and innovation, and all those things are working in concert with each other. Other brands can do one or two. When we do it, we get all four right, and we're very good in each part of that magic formula,” CEO Sean Tresvan said, as per a report in Business Insider.
The report also states that Taco Bell delivered 7% same-store sales growth in the fourth quarter, far outpacing the competition. It did not rely on discounts and, as a result, has seen bigger transactions than those who have used discounts to improve their situation. The brand’s popularity among a young customer base has also helped it remain steady in these uncertain times.
What’s even more impressive is the growth Taco Bell saw last year in active loyalty memberships. CEO Tresvan said that active loyalty members grew by an impressive 31% in 2025, while digital channels saw double-digit growth figures. App-exclusive rewards also incentivized customers to eat from the popular Mexican fast-food chain.
"We continue to innovate on the menu, but not only on the menu. We're going to make sure we're innovating from a guest hospitality standpoint, we're going to innovate in operations and innovate around the brand, not just in food,” Tresvan added.
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