The robust economy is giving people more spending money, but OC’s two largest fast-food companies are grappling with sagging sales and low stock prices. So in a bid to turn things around, both Irvine-based Taco Bell Corp. and Anaheim-based CKE Restaurants Inc.’s Carl’s Jr. chain have increased advertising spending year-to-date.
Taco Bell, the largest in sales among three brands under Tricon Global Restaurants Inc., boosted its ad spending 23% the first two quarters of this year, compared with last year’s first half.
According to Competitive Media Reporting, a New York-based firm that tracks advertising spending, the Mexican fast-food chain spent $109.6 million through June this year, compared with $89.3 million the year before. The chain spent the bulk of its budget, $60.6 million, on network television buys. It allotted $37 million to spot TV, doubled its cable TV network buys to $7.1 million, and devoted $3.5 million to national spot radio.
The company spent a total of $206 million on advertising in all of last year.
Taco Bell, which recently switched to FCB Southern California, has since dropped its popular talking Chihuahua campaign for one that focuses more on the company’s products. FCB has launched three commercials for Taco Bell in its first three months. Tricon, which has been struggling to reverse same-store sales declines this year, has lost roughly 41% of its value year-to-date and was recently trading at around 27 on the New York Stock Exchange.
Meanwhile, CKE has increased its spending for the Carl’s Jr. brand by 12% to $18.6 million for the first half, according to CMR. CKE, which operates and franchises 3,865 restaurants under the Carl’s Jr., Hardee’s and Taco Bueno brand names, spent the majority of its Carl’s Jr. budget on spot TV advertising.
Mendelsohn/Zien Advertising, Los Angeles, which created the latest “Don’t Bother Me, I’m Eating” campaign, handles the advertising account. Recently, Beard Boy Productions, Laguna Hills, was tapped on a project basis to write and produce a series of seven 30-second and 60-second radio spots for Carl’s Jr. The resulting “Too Good to Be True” campaign is set to run in 15 Western U.S. markets.
CKE’s Hardee’s chain recently launched a review of its estimated $100 million account held by incumbent Johnson/Ukropina in Irvine. The agency, which has held the account for just a year, also handles the Carl’s Jr. brand’s in-store advertising.
CKE, whose stock price has lost 66% of its value year-to-date, has been selling its company-owned Hardee’s restaurants to franchisees in a move to reduce debt and improve the bottom line. The company was trading around the 2 level last week. For the 28 weeks ended Aug. 14, the company’s total revenue fell 4%, to $1.02 billion, with a net loss of $16.4 million compared with earnings of $29.4 million in the 1999 period.
Dr. Seuss, I Presume
Irvine Spectrum Center is being transformed into Whoville next month for the opening of Universal Pictures’ “The Grinch” starring Jim Carrey at Edwards Cinemas. The center’s fountains will shoot green water, some restaurants will serve green eggs and ham, green pizza and other green items, and the original animated “How the Grinch Stole Christmas” will be playing on Nov. 11 on the big screen for $2 per person, including a snack. Additionally, the actual sleigh used in the new movie will be on site for photo opportunities Nov. 12, 17, 18 and 24.
Bits and Pieces:
Welcome Magazine, San Clemente, publisher and distributor of free bi-monthly tourist magazines, recently hired Envision Public Relations in Los Angeles to handle its PR for its move into the Los Angeles area. James Kirkwood, who founded Welcome in 1991, says the company distributes about 35,000 copies every two months in local hotels, airports, train stations, beach areas and amusement parks … Strategies, Costa Mesa, was given a bronze Questar award by the International Academy of Communications Arts and Sciences for a corporate video it produced for IFS Corp., Tucson. The PR firm used Stanley Kubrick’s movie “2001: A Space Odyssey” for inspiration to create the trade-show video “IFS E-Business Solutions: Are You Ready for 2001?” Anne Bryan and Dan Zukowski recently got together to form Danna Group in Huntington Beach, a consulting firm focused on business communications and marketing Are you the messiest person in your office? Buy.com, Aliso Viejo, recently launched a contest to promote its new “Get Organized Store” seeking the Internet shopper with the messiest work space, who will win a $5,000 shopping spree on the Web site. Entrants must send a photograph of their cubicle or office with a 50-word essay before Oct. 31.
