Introduction
Burger King is one of the most recognized brands in the fast food hamburger space, with over 18,000 locations globally and systemwide sales of $20 billion in 2019. However, the Miami-based chain faces intense competition from a wide range of rivals, both domestically and abroad. In this analysis, we‘ll take a deep dive into the fast food competitive landscape through the lens of a retail and consumer expert to see how Burger King stacks up.
Burger Battles: Burger King vs. Top Competitors
Burger King‘s most direct competitors are the other major hamburger quick-service chains. Here‘s how the brand compares to its top rivals on key metrics:
| Metric | Burger King | McDonald‘s | Wendy‘s | Jack in the Box | Sonic |
|---|---|---|---|---|---|
| Global Locations | 18,000+ | 39,000+ | 6,500+ | 2,200+ | 3,500+ |
| 2020 Revenue | $1.6B | $19.2B | $1.7B | $1.0B | $0.4B |
| Avg. Unit Volume (US) | $1.4M | $2.9M | $1.7M | $1.6M | $1.3M |
As the data shows, McDonald‘s is by far the largest player in the space with over 39,000 locations and $19 billion in annual revenue. Burger King comes in a distant second, followed by Wendy‘s. While Burger King and its rivals all offer similar core menus of burgers, fries, and soft drinks, each has tried to differentiate with signature items and unique brand positioning.
Burger King is known for its flame-grilled Whopper and "Have It Your Way" customization. McDonald‘s iconic offerings include the Big Mac, Quarter Pounder and McNuggets, supported by unmatched scale and marketing muscle. Wendy‘s differentiates with its "fresh, never frozen" square burger patties, indulgent Frostys, and irreverent social media presence.
Chicken Fight: The Rise of Poultry Chains
While the burger chains duke it out, the fast food chicken category has been on fire in recent years. Chick-fil-A has been leading the flock with rapid growth, reaching over $4 billion in sales from just 2,700 mostly US locations in 2020. The Atlanta-based chain now ranks as the 3rd largest US fast food chain by sales, despite being closed on Sundays.
Chick-fil-A‘s signature pressure-fried chicken sandwich has inspired a host of imitators and sparked the "chicken sandwich wars." Popeyes Louisiana Kitchen, a sister brand to Burger King under Restaurant Brands International (RBI), launched its own chicken sandwich in August 2019 to much fanfare and long lines. The sandwich helped boost Popeyes‘ comparable sales by nearly 40% in Q4 2019.
Traditional bone-in fried chicken chains like KFC, Church‘s and Popeyes have also stepped up their sandwich game to compete in this hot category. KFC, the global chicken leader with over 25,000 locations in 145 countries, has been aggressively promoting its revamped chicken sandwich. Even McDonald‘s is jumping in with a new "premium" chicken sandwich rolling out in 2021.
Of course, Burger King doesn‘t just compete with other burger and chicken chains. The brand is fighting for a "share of stomach" with any quick-service restaurant that offers fast, affordable, and convenient meals. That includes major pizza chains like Domino‘s, Pizza Hut, and Papa John‘s, which have made delivery a key competitive advantage.
Domino‘s, in particular, has been a technology leader, driving over 60% of sales through digital channels. The Michigan-based chain has also been expanding its footprint rapidly, reaching over 18,300 locations globally and $4 billion in revenue in 2020. Pizza Hut and Papa John‘s are not far behind, with each chain approaching 20,000 and 5,000 global locations, respectively.
Mexican quick-service chains like Taco Bell, Del Taco and Qdoba are also competing for consumers‘ fast food dollars. Taco Bell leads the pack with over 7,000 locations and $12 billion in sales as of 2020. The California-based chain has been driving growth with indulgent limited-time offers like Nacho Fries and the Chalupa Cravings Box.
The Fast-Casual Threat
Perhaps the most disruptive force in the fast food industry over the past decade has been the rise of fast-casual chains. These concepts blend the speed and convenience of fast food with higher quality, customizable menu items in an upscale atmosphere. Leading fast-casual burger chains include Five Guys, Shake Shack, and Smashburger.
Five Guys has grown to over 1,600 locations worldwide by focusing on fresh, hand-formed burgers and fries. Shake Shack has become a global cult favorite, known for its premium burgers, crinkle-cut fries and frozen custards. The New York-based chain reached nearly $600 million in revenue from just 300 locations in 2020.
While these chains are still much smaller than Burger King, they have been steadily stealing market share, particularly among higher-income, urban Millennial consumers. In response, Burger King and other traditional fast food chains have been upgrading their ingredients, remodeling restaurants, and testing new concepts like Burger King‘s upscale "Whopper Bar" format.
Global Game: Burger King‘s International Presence
While much of the fast food battle is waged in the US, Burger King is also a major global player, with over half of its locations outside the United States. The chain has a strong presence in international markets like Canada, Germany, Mexico, Russia, and China. However, it faces stiff competition from both other multinationals and homegrown chains in each market.
In Europe, Burger King competes with not only McDonald‘s but also local favorites like Nordsee in Germany and Quick in France. In Asia, the brand faces off against Japanese chain MOS Burger and Chinese giant Dicos. Burger King has also had to adapt its menu and marketing to local tastes and cultural norms in each market.
One key advantage for Burger King internationally is its master franchise joint venture model. The company partners with strong local operators like Alsea in Mexico and the Everstone Group in India to accelerate growth and navigate regional complexities. However, this asset-light model also means Burger King has less control over the customer experience and supply chain compared to a more vertically integrated competitor like McDonald‘s.
The COVID-19 Impact
The COVID-19 pandemic has upended the fast food industry, forcing chains to quickly pivot to drive-thru, delivery and mobile ordering. Burger King was no exception, with global comparable sales plunging 25% in Q2 2020 at the height of the lockdowns. However, the chain‘s parent RBI said Burger King was able to stabilize sales by Q4 to a decline of just 8%.
Burger King‘s main competitors were also hard hit by the pandemic, though results varied based on each chain‘s exposure to locked-down markets and ability to shift to off-premise. McDonald‘s global comparable sales fell 24% in Q2 before recovering to a 1% drop in Q4. Wendy‘s fared somewhat better with a 4% decline in Q2 and a 5% increase in Q4, buoyed by its high drive-thru mix.
The pandemic has accelerated the shift to digital and delivery across the fast food industry. Chains are scrambling to roll out mobile ordering apps, expand partnerships with third-party delivery services, and test new contactless technologies like curbside pickup. Burger King has been playing catch-up in some of these areas compared to more digitally advanced competitors like McDonald‘s and Domino‘s.
Future Outlook and Competitive Advantages
Looking ahead, the fast food competitive landscape will only get more intense as chains battle for market share in a post-pandemic world. One major wild card is the rise of plant-based meats as an alternative to traditional beef. Burger King was an early mover here, partnering with Impossible Foods to launch the Impossible Whopper in 2019.
However, rivals like McDonald‘s and Wendy‘s have been more cautious, with McDonald‘s only recently announcing a test of the "McPlant" burger in select markets. It remains to be seen whether plant-based options will move beyond a niche to become a mainstream menu category. But they could shake up the competitive dynamics, particularly as consumers prioritize health and sustainability.
Other potential disruptors on the horizon include the growth of delivery-only "ghost kitchens," autonomous delivery vehicles, and a possible increase in the minimum wage. All of these factors could alter the unit economics and value proposition of fast food in the years ahead.
To stay ahead of the pack, Burger King will need to leverage its key competitive advantages:
- Strong brand equity and marketing prowess, as exemplified by edgy campaigns like "Moldy Whopper"
- Extensive global footprint and master franchise partners to drive overseas expansion
- Menu innovation and value focus, as seen in offers like the $1 Your Way menu and Sourdough King
- Experienced management team and franchise community under RBI‘s ownership
At the same time, the chain will need to close the gap in areas like digital capabilities, drive-thru speed of service, and menu quality perception. By playing to its strengths and addressing its weaknesses, Burger King can defend its position as a top-tier global fast food brand for years to come.
Key Takeaways
In summary, Burger King faces a highly competitive and rapidly evolving fast food landscape, characterized by:
- Intense rivalry among major hamburger chains like McDonald‘s and Wendy‘s
- The rapid rise of fast-casual "better burger" concepts like Five Guys and Shake Shack
- Surging popularity of chicken chains like Chick-fil-A and the "chicken sandwich wars"
- Continued competition from other fast food categories like pizza, Mexican, and sandwiches
- Disruptive shifts toward digital ordering, delivery, plant-based meats, and other trends
To succeed in this environment, Burger King must leverage its key brand equities and global scale while also innovating in areas like menu, value, technology, and franchisee partnerships. The chain‘s ultimate competitive advantage will be its ability to adapt to changing consumer tastes and market conditions faster than its rivals.
As Burger King navigates this ever-shifting landscape, one thing is clear: the fast food wars are far from over. In the battle for consumers‘ hearts, minds and stomachs, there can be only one true king. And the Whopper aims to reign supreme.
