It’s the fast food chicken chain that most consumers outside the US have never heard of. But inside America, the wild popularity of family-owned chain Chick-fil-A has been identified as a threat to major fast food behemoths like McDonald’s and has even surpassed chicken giant KFC.
The title of a recently released market report for McDonald’s says it all: “Chick-fil-A a Serious and Growing Competitive Threat.”
Written by financial services firm Janney, the report notes that the privately owned company held a 26 percent market share of the fast food chicken industry in 2013 -- up from 9 percent in 1999.
For comparison, in 1999, Yum! brand’s KFC enjoyed a comfortable lead with a 40 percent share of the market.
Today, that’s down to 22 percent, several percentage points below Chick-fil-A and enough to make the Colonel turn in his grave.
The recently released results of Consumer Reports' annual fast food ranking corroborates the popularity of Chick-fil-A, as respondents gave the brand top billing in the category of chicken sandwiches.
KFC landed at the bottom of the heap, after other chains like Popeyes Louisiana Kitchen, Zaxby’s and Church’s Chicken.
Chick-fil-A found success carving out a niche market selling deep-fried chicken sandwiches, nuggets and wraps since 1946.
The brand's success is all the more impressive given that KFC possesses more than double the number of outlets as its counterpart. While Chick-fil-A has 1,790 restaurants in 39 states and Washington DC, KFC has 4,500 outposts across the country.
Furthermore, all Chick-fil-A restaurants close system-wide close on Sundays -- or ‘Lord’s Day’ -- as part of founder S. Truett Cathy’s religious beliefs.
Meanwhile, the Janney report issues some stern warnings to fast food giant McDonald’s, which also offers a slew of chicken-based items on its menu.
While the chain is described as a relatively “small fry” compared to worldwide sales at McDonald’s, the report notes that KFC didn’t see Chick-fil-A's success coming a decade ago either.
In 2013, McDonald’s generated $36 billion in systemwide sales, versus $5 billion at Chick-fil-A.
“While Chick-fil-A remains meaningfully smaller than McDonald’s U.S. today, to the extent it could be ignored as a competitive threat ten years ago, we would argue that it can no longer be ignored as a long-term competitive threat today,” analysts write.
Here are the top 10 fast food brands in the US by sales in 2013:
5. Burger King
7. Dunkin' Donuts
8. Pizza Hut