Fast-Food Chains' ‘Wrap Battle' Has Commenced

A wrap battle is booming in the QSR arena. By remixing preexisting ingredients with build-your-own appeal, major players are producing flavor-drenched "hunger hacks" and fresh affordable snacks that span dayparts.

Wendy's, Burger King, KFC, and Sonic are among the wave of restaurant chains innovating their wrap offers with a blend of classic and bold flavors, reported Restaurant Business.

Value is a key attribute driving this momentum, as the affordability of wraps extends to food service operators and consumers.

In most cases, adding this item to the menus requires the addition of only one SKU—a flour tortilla. Operators can then combine proteins (chicken is the most popular) with sauces, veggies, and other ingredients that are already a part of their inventory.

According to MenuData, Burger King introduced chicken wraps in varieties like Classic, Spicy, and Honey Mustard last August, while KFC ventured into unique combinations with its Spicy Slaw and Mac & Cheese Wraps.

Other notable additions include Carl's Jr.'s BBQ Hand Breaded Chicken Tender Wrap, Dunkin's Chicken & Roasted Pepper Wrap, and Saladworks' Jalapeño Ranch Crispy Chicken Wrap.

"These menu expansions reflect a shift towards offering a larger number of wrap[s], which include diverse and innovative options, catering to a wide range of customer tastes," MenuData CEO Sunny Khamkar told The Food Institute.

Tapping Snack Appeal to Span Dayparts

The wrap battle is echoing across other foodservice venues as QSRs pull more lunch daypart share from grocery and convenience channels.

According to a February 2024 report by Circana, FMI, and Oliver Wynman, younger generations, especially Gen Z, are increasingly driving growth at foodservice establishments and shifting midday spend to QSRs.

Similar movement can be seen in the snack category, where customizable mix-and-match wrap deals that bridge dayparts are faring well in both fast food and QSRs environments.

As the report suggests, leveraging snackability could be a valuable target for ongoing innovation across multiple dayparts.

"Snack foods play different roles throughout the day and should be promoted to consumers based on their shifting needs," noted the authors. "Between main eating occasions, consumers look for ways to tide themselves to the next one or to satisfy cravings."

As the report also observes, QSRs excluding fast casuals held a 54% share of traffic across foodservice snack channels as of September 2023, marking a 5% increase year-over-year.

C-stores hold the next highest share (28%), followed by all other Retail Foodservice (8%), but YOY traffic at both channels was down 3%, and 2%, respectively.

"To win the wrap battle, it'll be on QSRs to deliver on not just taste, but value and innovation as well," Vijay Sukumar, chief food innovation Officer at KFC, told Restaurant Business.

Channeling MTO Appeal

As more QSRs drop fresh wraps and c-stores push back with their own creations, order customization could be a growth advantage.

According to a June 2023 consumer study from FoodserviceResults, 66% of respondents said convenience stores should offer made-to-order (MTO) food. Furthermore, 72% of those respondents were members of Gen Z, reported C Store Decisions.

In March 2024, East coast c-store chain Wawa launched a build-to-order wrap campaign to elevate the offer by placing customization in the hands of the consumer. Food Institute Focus

New Study Exposes the Power (and Pitfalls) of AI-Generated Food Images

Generative AI continues to pervade the food industry, and image creation is no exception.

On a company level, the path to incorporating these tools has been, in many cases, experimental. In recent months, some early adopters have been cast into the public eye for sharing inaccurate or unappetizing AI-generated food images.

In January, Instacart scrubbed a swath of recipes with AI-generated food images from its website after "unsettling" details like strangely blended textures and physically impossible compositions began raising eyebrows, reported Business Insider.

Despite such pitfalls, food producers that master the nascent technology could reap significant rewards in the long term.

According to new findings by the University of Oxford, consumers think AI-generated food images look tastier than authentic photos of food.

In the study, the researchers asked 297 participants to rate a range of real and AI-generated images — including natural, processed, and ultra-processed foods — on a scale from "Not at all appetizing" to "Extremely appetizing."

Results suggest that AI-generated visuals can enhance food's overall appeal by leveraging key features such as symmetry, shape, lighting, color — even subtle tweaks in positioning like not pointing products directly at the viewer.

Key Considerations and Concerns for AI-generated Food Images

The study also revealed that an awareness of the image creation process impacts overall reception.

When participants knew how each image was sourced, they tended to rate real and AI-generated versions equally appealing. When participants were unaware, however, the AI-generated version was consistently rated as significantly more appetizing than the real food image.

This point could be noteworthy for food producers as formal regulations surrounding the technology have yet to be established. In the case of Instacart, the company has been publicly disclosing when photos are generated by AI, emphasizing that user discretion is advised.

Furthermore, the study raises concerns about how AI imagery could potentially foster unrealistic expectations about how natural foods should look and potentially harm sustainability efforts such as the promotion of "ugly" fruits and vegetables.

Consistent exposure to picture-perfect dishes could also influence unhealthy eating behaviors at a time when American diets are already under heavy scrutiny.

"While AI-generated visuals may offer cost-saving opportunities for marketers and the industry by reducing the cost of commissioning food photoshoots, these findings highlight potential risks associated with exacerbating ‘visual hunger' among consumers – the phenomenon where viewing images of food triggers appetite and cravings," said study supervisor and co-author Professor Charles Spence, a Professor of Experimental Psychology at University of Oxford. Food Institute Focus

Chef Robert Irvine Provides Guide for Restaurants to Survive Wage Hikes

The restaurant industry has reached a crossroads regarding labor costs. Chef Robert Irvine has kept a close eye on the issue, especially as California recently raised its minimum wage for the state's fast-food workers to $20.

"Times have changed," Irvine, a celebrity chef and longtime restaurateur, told The Food Institute. "With this new law in California that passed, we were already seeing problems; the inflation and food costs went through the roof. ... We thought the interest rates were going to drop; they didn't.

"As these changes affect the rest of the country – and they will – you'll start to see a decline in smaller restaurants. We've already seen restaurants close."

"I'm not a prophet of doom and gloom," he added. "I'm just telling you what's happening in the industry."

Irvine, a veteran of nearly four decades in foodservice, isn't against workers making a living wage. After all, he's been there, as a former immigrant from England who began working in the U.S. as a dishwasher. Irvine does, however, believe that restaurant operators need to carefully consider their labor expenses these days.

"We don't have that capacity to fill those jobs anymore," Irvine said.

The celebrity chef, who appeared on Food Network's Restaurant: Impossible show between 2011 and 2023, fears that as many as one-fifth of all American "mom-and-pop" restaurants could be forced to close by year's end due to rising labor costs.

"I've had some of my own Restaurant: Impossibles [consider] closing down this week, because they can't afford to pay" up to $20 per hour, Irvine noted. "And I said ‘Don't close yet; let me show you something. ... Look at technology to help you out.' There's so much technology out there."

In that spirit, Irvine partnered with self-service tech company GRUBBRR to launch a project called Restaurant Revamp. The national campaign will start in California and grant a winning business a full suite of restaurant technology designed to address labor challenges.

"I want to prove that, if you use technology in the restaurant business, it will actually make you money," Irvine said. "I'm all for the wage increases; I agree with the living wage and increasing wages, because for years our restaurant workers have suffered. ... The unintended consequences of that is this: We've seen restaurants put up their prices, and then the consumer says ‘Well, I can (just) cook at home.'"

Meanwhile, Irvine has observed major restaurant chains like McDonald's and Taco Bell deftly incorporate technology like kiosks to ease their labor expenses.

"Not many people are using [technology correctly], except the big boys, like McDonald's and Yum Brands. And, because of technology, if you look at their earnings year over year, they're through the roof," Irvine noted. "And I want small operators to be able to do that.

"I want to prove, especially in California, that yes, smaller restaurateurs can make it, even with all these things stacked against you."

Humans will continue to play a key role on restaurant staff for the foreseeable future; Irvine realizes that. Yet he's also noticed that many Gen Z and millennial consumers don't seem to care if they receive human interaction from restaurant workers. Irvine chef is also enamored with technology like inventory control systems, automatic ordering, and Flippy – Miso Robotics' French fry-cooking robot.

"I started in the restaurant business 36 or 37 years ago and we were still counting on abacuses – that's how old I am," Irvine joked. "And here we are now. ... Over the last 30 years, technology has changed dramatically.

"There's always going to be people (working) in restaurants," he added. "Do I want a computer or a robot bringing me food? No, not at all. But I want the speed of service, and accuracy. (And) technology allows for pinpoint accuracy." Food Institute Focus

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