Foot-traffic trends suggest why Taco Bell and Chipotle are giving away free food
Both Taco Bell ($NYSE:YUM) and Chipotle ($NYSE:CMG) are giving away free food in promotions tied to the upcoming NBA Finals. Nothing gets people into restaurants like free food, but for two of the most recognizable brands in fast food, one has to wonder why they would need more foot traffic.
Alternative data — specifically foot traffic metrics collected by Facebook ($NASDAQ:FB) — might have the answer: over time, both fast food chains saw their "were here" count, a metric that tracks how many check-ins and mobile device location shares these brands have over time, decline in growth.
At first glance, this is a positive chart showing foot traffic growth for the place that thinks outside the bun. But in looking at year-over-year change in foot traffic, Taco Bell saw its year-over-year change decline from about 18% to below 10%.
Chipotle, meanwhile, has more of a flatline: its "were here" count growth is nearing 0%, meaning less people are checking into Chipotle on their cell phones voluntarily or involuntarily.
While Facebook's "were here" count isn't the tell-all of foot traffic metrics, it is still one of the most used social networks on mobile devices, which gives some legitimacy to these trends. These two brands are vieing for an increase in foot traffic from their NBA Finals promotions, and given that they are almost direct competitors, a sway in traffic towards one or the other due to these promotions may cause an even bigger flatline to their rival's "were here" count.