Chris Ondrula runs Burger King’s second-largest franchise operation, so he can’t ignore McDonald’s. It’s his largest competitor, and he drives by the chain’s global headquarters twice a day.
Oak Brook, Ill., has long been home to the golden arches, but the headquarters of a 412-unit Burger King franchise is less than five miles away.
The Miami-based brand is on the upswing, thanks to efforts courting women and families, including toned-down advertising, updated restaurants and a vast menu expansion that cribs from many recent McDonald’s hits, including lattes, smoothies, salads and wraps.
Burger King’s same-store sales rose 3.2 percent in 2012, following years of declines. The resurgence coincided with McDonald’s first monthly same-store sales declines in more than nine years. McDonald’s has reported two monthly same-store sales declines since October, though 2012 global same-store sales rose 3.1 percent. Analysts expect both chains to have a rough first quarter.
“I’ve heard a lot about McDonald’s and the negative impact that they’ve seen in their business that they haven’t seen in a few years,” Ondrula said. “I do go to bed at night very satisfied that we are seeing successes, and they’re building on each other.”
According to Technomic, a Chicago-based restaurant industry research and consulting firm, Burger King came close to retaking the No. 2 spot in the burger segment last year after losing it to Wendy’s in 2011.
Wendy’s and Burger King each have a 12 percent share of the $71.8 billion fast-food segment. Technomic estimates that Wendy’s 2012 sales rose 1.2 percent to $8.6 billion and that Burger King’s rose 2.9 percent to $8.59 billion.
Neither stands a chance of catching McDonald’s, which saw U.S. sales rise 4.2 percent in the U.S. despite a sluggish year, to $35.8 billion, or 49.6 percent of the domestic hamburger category.
Darren Tristano, executive vice president of Technomic, characterized 2012 as “a step in the right direction” for Burger King, citing its expanded menu and remodeled restaurants.
“Burger King has been struggling for over a decade,” he said. “Sometimes it just takes some time to slow down the rhythm before you can change directions.”
While copying McDonald’s on some items might not win originality points, it means “you’re not giving your customers an excuse to go to McDonald’s,” Tristano said.
Burger King was taken private in a $4 billion deal in 2010, kicking off a brand overhaul that’s focused on its menu, marketing, restaurant ambience and operations. The chain has upgraded the Whopper and added new products to attract women, such as chicken, apple and cranberry salads.