Yum! Brands (NYSE:YUM) pretty much invented the idea of combining snack chips and savory food products.
The company created a trend when it launched the Doritos Locos Taco in 2012. That item became a huge hit, leading to the company creating a variety of Doritos-based spinoffs, and leading to other fast-food chains trying to get in on the action. Most notably, Restaurant Brands International's (NYSE: QSR) Burger King had some success with its Mac 'n Cheetos deep-fried macaroni and cheese menu item and Carl's Jr./Hardees attained media attention for its burger featuring Lay's potato chips (along with a hot dog) on top of the burger patty.
Taco Bell, however, has been the unquestioned leader in this space, with six Doritos-based tacos on its regular menu, along with something called the Doritos Cheesy Gordita Crunch. None of those variations -- and nothing any of its rivals have done -- have equaled the sales of the original Doritos Locos Taco, though. So, after trying an array of special menu items like the Cheddar Habanero Quesarito, the Triple Double Crunchwrap, and Walking Nachos, the chain has turned to another snack chip -- Cheetos -- and begun testing a Cheetos-filled quesadilla in the Philippines.
What is Taco Bell doing?
The fast-food company has launched the Cheetos Quesadilla exclusively in its stores in the Philippines. A fairly simple proposition, the new product is a flour tortilla filled with jalapeno-flavored Cheetos and a lot of cheese.
It's a recipe that relies on the Cheetos to entice customers into trying something that otherwise is just a basic cheese quesadilla. Like the Doritos Locos Taco, it's an effort to leverage a familiar taste in a new setting with the idea of getting diners excited.
The company has not announced any plans to bring the new product to the United States. In the past, the chain has tested products in other markets before releasing them in U.S. and it has also introduced items outside its home country without ever launching them domestically.
Why is Taco Bell doing this?
Dozens of fast-food chains are all fighting over the same customers. In addition, some of that audience has been lured away by higher-end fast-casual chains, and the restaurant industry currently has more start-ups and new concepts than the existing customer base can support.
Launching an attention-getting product that people want to try brings people in the door. Tying a new item that incorporates an already popular snack chip has the dual benefit of perhaps attracting fans of the chip who might otherwise not visit the chain.
The Cheetos Quesadilla is simply the escalation of a trend that has Pizza Hut stuffing hot dogs in its crust and KFC launching chicken-flavored lip gloss. Taco Bell has proven to be as good as, if not better than, any other chain, in using this strategy. That's why the Cheetos Quesadilla has the makings of a hit.