restaurants

Many Leading Fast Food Brands Lose Value

McDonald’s, KFC, Domino’s, Subway, Pizza Hut and Taco Bell all lost brand value in the past year, according to the 2017 edition of Brand Finance’s annual restaurant valuation rankings.

The brand valuation and strategy consultancy attributes the big fast-food brands’ losses to consumers’ healthier eating habits and the popularity of certain fast-casual restaurant formats, such as Panera Bread.

While McDonald’s remains No. 1 in the ranking, with estimated brand value of nearly $38.97 billion, that’s down from about $42.94 billion, or 9%, from 2016’s rankings. 

KFC slipped by one place to No. 4, as its valuation dropped by 27% to $6.12 billion, from $8.45 billion. Domino’s also slipped by one place to No. 6, dropping 16% to $3.98 billion, from $4.76 billion. 

Thanks to the other chain’s slippage, Subway’s ranking actually rose one place to No. 7, although its valuation slipped 1% to $3.72 billion, from $3.76 billion.

Pizza Hut declined one place to No. 8, and lost 22% in valuation — down to $3.29 billion from $4.24 billion. 

Beleaguered fast casual Chipotle Mexican Grill managed to hold onto its No. 9 ranking, but its brand value dropped by $442 million to $2.94 billion from $3.38 billion, or 13%. 

Taco Bell held its No. 10 ranking, but its value declined by 10% to $2.21 billion, from $2.46 billion.

Brand Valuation Winners

On the winning side, Starbucks retained its No. 2 ranking, as its estimated brand valuation rose 10.5%, to $25.6 billion.

Both Tim Hortons and Burger King benefitted from their merger: Their combined valuation is up by $4 billion since the completion of that deal in late 2014. In fact, Tim Hortons’ ranking rose by one to No. 3, and its valuation jumped by a whopping $2.4 billion or 45.5% to $7.68 billion, from $5.28 billion. Burger King’s ranking rose by one to No. 5 as its valuation rose 10.9%, to $5.07 billion from $4.57 billion. 

Below the top 10, but rising, are Costa Coffee (up one ranking to No. 11, with valuation up 20% to $2.05 billion); Panera Bread, up one ranking to No. 12 with valuation up 32%, to $1.93 billion; Jollibee, up two places to No. 14, with valuation up 29% to $1.43 billion.

Dunkin’ Donuts retained its No. 15 ranking, and saw its valuation increase 19% to $1.34 billion. 

The brands in the lower 10 of this top 25 ranking, starting with No. 16, are Buffalo Wild Wings (down two rankings, valuation up 10%, to $1.26 billion); Papa John’s (retained #17 ranking — but saw among the largest valuation growth of the 25 brands, up $373 million or 52% to $1.09 billion); Chili’s (retained #18 ranking, valuation up 26% to $1.02 billion); Olive Garden (retained No. 19, up 52% to $1.02 billion); Red Lobster (retained No. 20 ranking, valuation up 33% to $795 million); Sonic (up one place to No. 21, valuation up 29%, to $759 million); Cracker Barrel, down one place to No. 22, valuation up 24% to $737 million); Cheesecake Factory, up one place to No. 23, valuation up 24% to $652 million); Denny’s, down one place to No. 24, valuation up 11% to $648 million); and Texas Roadhouse (retained No.25, valuation up 24% to $645 million).

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