Burger King Just Started Selling Hot Dogs Today -- Here's Why

Updated from original story on Feb. 10.

The king of flame-broiled burgers has officially brought its grill skills to wieners.

On Tuesday, Burger King, which is part of Restaurant Brands International (QSR)  -- launched grilled hot dogs at all 7,150 of its North America restaurants. Initially announced at an event held on Feb. 9 in New York City attended by TheStreet, the home of the Whopper is offering two variations of hot dogs -- the classic and chili and cheese.  

It's the first time in the history of the 62-year old burger giant that it has sold hot dogs on a national basis. Very early on, however, Burger King did offer a hot dog on its original menu for a mere 24 cents. 

The classic hot dog is priced at $1.99, and consists of a 100% all-beef frank topped with relish, yellow mustard, ketchup and chopped onions. Consumers are paying a little more -- $2.29 -- to chow down on a Burger King hot dog slathered in chili and shredded cheese. In visiting one Burger King location in Long Island New York on Tuesday, TheStreet discovered Burger King is offering its grilled hot dogs as a meal option.

For $4.49, a diner can chow down on a classic grilled hot dog, small fries and a small fountain drink. Swapping out the classic for the chili cheese dog costs 30 cents more in the meal option. 


Burger King selling hot dogs as meals, too. 

Burger King's road to selling hot dogs began over a year and a half ago in five test markets: Salt Lake City, Utah, Memphis, Tennessee, Baltimore, Maryland, Detroit, Michigan, and Kansas City, Missouri. Not making the cut for the national debut was the $1.49 corn dog.

Burger King says it exceeded its sales targets in each of its test markets, giving it confidence that consumers across the country will embrace its hot dogs.

"We are not seeing grilled dogs as a product launch, we are tapping into a new category -- this is probably the biggest thing we have done as a brand in a few decades," said Alex Macedo, Burger King's president of North America to attendees at the event.

Burger King is supporting its initial foray into dogs with its "biggest TV, digital, social media and merchandising blast that it has done in quite a few years," said Macedo, which is no small statement for a playful brand like Burger King that has aggressively marketed new products such as chicken fries.  

TheStreet came across several ads Tuesday on Pandora for Burger King's hot dogs. Burger King also took out a full page ad in the New York Daily News featuring its King mascot to promote its new frankfurters. 



The chili cheese hot dog was a little heartier than the classic at the media event.

Macedo tells TheStreet that Burger King saw two things during its tests that suggest grilling up hot dogs would be good for business.

First, it did not see consumers stop buying pricier hamburgers to scarf down cheaper hot dogs. "It was a lot of add on behavior -- the average check with a hot dog was higher than without a hot dog, and for our industry that is a really big deal," said Macedo. Second, the availability of hot dogs drove new customers to Burger King's restaurants in a "very significant way."

In taste tests at the launch event, TheStreet found each hot dog to be surprisingly tasty, reminiscent of the ones made on the grill during a backyard BBQ. And the heartiness of the chili dog (and no, the chili was not spicy...yet) seemed to make it worth the 29-cent premium relative to the classic.



Burger King's new hot dogs tasted identical to the ones sampled at the media event.

But taking a completely new fast food item from a controlled media setting to over 7,000 Burger King restaurants in a single day is a herculean task. So we decided to taste the hot dogs again on launch day to see if Burger King delivered the goods.

Much to our surprise, we arrived at the same verdict after ordering the classic and chili cheese dogs at the Long Island, NY location. The two hot dogs came out in under five minutes and looked -- and tasted -- identical to the ones at the media event. 

Should hot hogs prove successful for Burger King, it could light an even larger flame under the fast-food chain's already sizzling sales in the U.S.

Burger King's comparable store sales in the U.S. rose 2.8% in the fourth quarter, following an impressive 4.3% gain for the third quarter. For all of 2015, same-store sales in the U.S. increased an impressive 5.7%.

A boost to sales could also help reawaken shares of Burger King's parent company. Restaurant Brands International, which also owns coffee-and-donut chain Tim Hortons, has shed about 23% in the past year compared to a 9% decline on the S&P 500 amid fears of slowing sales growth and the impact of greater discounting in the fast food industry. 


Sonic sells a ton of hot dogs each year.

In moving to offer hot dogs, Burger King is entering a very competitive market.

According to the latest data from the National Hot Dog and Sausage Council, nearly 1 billion packages of hot dogs were sold at U.S. retail stores in 2014, fueling the meals of people that prefer to eat at home instead of at a fast food joint. Retail sales of hot dogs in the U.S. reached $2.6 billion for the 52-weeks ended Dec. 26, representing a 0.1% drop year over year, according to data from Nielsen.

And within the fast food business, Sonic (SONC) is the undisputed hot dog king. In a June 12 interview with TheStreet, Sonic's CEO Clifford Hudson mentioned that every 1 out of 7 hot dogs served outside of the home in the U.S. is sold from Sonic. According to a company spokeswoman, Sonic sold a whopping 151.8 million hot dogs in 2015, representing 10% growth over the previous year.

Sonic sells 12 different types of hot dogs. They run as simple as a classic hot dog with ketchup, yellow mustard, relish and chopped onions (similar to Burger King's classic) to the fancier cheese and bacon hot dog wrapped in a pretzel bun. The company also hawks mini hot dogs known as "lil doggies" and foot-long hot dogs.

"It's not surprising that people are trying to take hot dogs onto their menus", said Hudson at the time.

Nathan's (NATH) has sizable presence in the hot dog business, too.  The company sold over 500 million hot dogs in 2014 at places such as supermarkets and at over 230 of its own U.S. restaurants. 

Some of the chains that have tried to take a bite out of Sonic's hot dog dominance of late include Carl's Jr., which placed sliced wieners on its new "Most American Thickburger" last year. At Yum! Brand's (YUM) Pizza Hut's chain, it debuted the "Hot Dog Bites" pizza in 2015. And better burger joint Shake Shack (SHAK) also sells hot dogs.



Burger King's grilled dogs taste almost like ones made on a backyard barbecue.

Asked what will separate Burger King's hot dogs from Sonic's offerings and others, Macedo quickly answered, "our hot dogs are flame-grilled."

Despite the sales potential, rolling out hot dogs is not without a risk for Burger King. After all, it's known by people for its Whoppers and its name, after all, is "Burger King." And the risk of being unable to persuade folks to try something other than burgers and fries is a lesson fellow burger giant McDonald's (MCD) learned the hard way years ago.

The McHotDog was first introduced in 1995 at some U.S. McDonald's locations in the Midwest, but never really caught on with consumers and were discontinued. McDonald's currently does not have a hot dog on its U.S. menu.

When TheStreet asked one McDonald's New York City franchisee if they would be open to serving hot dogs, the answer was pretty resounding. "No -- I believe it would just be a trade-off from our current menu and add complexity to the kitchen," said the franchisee. For its part, Burger King appeared to quickly work out the operational kinks to cooking hot dogs at its test locations.

"After a couple of weeks, we saw that team members can build a hot dog just as fast as they build a hamburger -- the cooking method is exactly the same as the Whopper -- it's flame-grilled over an open flame," said Macedo.


Spotting Burger King's hot dog promotion event, a nearby office asks for some dogs -- a good sign.

To get its over 250,000 U.S. employees jazzed up about selling a fundamentally different product, Burger King has enlisted some help from Hollywood. English-speaking training videos on how to make its new grilled dogs will be led by rapper and music mogul Snoop Dogg. For those employees that speak Spanish, they will learn how to flame-grill a hot dog from Latin actress and musician Charo.

The celebrity training videos seem to have worked -- we found nice grill marks on both of our hot dogs Tuesday.


The grill marks appeared as advertised.

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