Taco Bell

Fans instantly got that Taco Bell was teasing the Cool Ranch flavor of the Doritos Locos Tacos. Typical responses to the Facebook post read, "There is a god," and, "Please let it happen I have been waiting for this moment for years." Taco Bell confirmed that Cool Ranch Doritos Locos Tacos will be released in 2013.

Last week, Taco Bell dropped a diptych on their Facebook wall that got over 132,000 likes and in excess of 12,000 comments. “Anything could happen in 2013,” read the text above the photo. On the left, a bag of Cool Ranch Doritos. On the right, a taco.

“I'm absolutely stoked,” for the new Cool Ranch flavor of the Doritos Locos Taco, a taco inside in a shell made from a Doritos chip, Robert Checkal, 25, a public relations account executive in New York City, told TODAY. He found the first nacho flavored Locos taco “surprisingly delicious,” he said. “You think, it's probably terrible for me, it looks nasty, but it sounded new and exciting.”

It sounds like a gag-inducing gimmick, but experts say it’s sheer brilliance.

Dino Baskovic, 38, adjunct professor at Lawrence Technological University in Michigan, tried the Nacho Doritos Locos Taco the first day it came out.

“Co-branding” like the Taco Bell/Doritos partnership represents a delicate alchemy where the qualities of two different brands are fused together and something greater than the sum of its parts is teased out. A special kind of something that also happens to pay a nice licensing fee dividend.

There have been successes like Eddie Bauer edition Ford trucks, and recently Jimmy Choos designed some Uggs. The annals of marketing history are also littered with brand extension fails. Remember McDonald’s venturing into apparel in the '80s? 

This co-branding endeavor, though, is a no-brainer. Essentially Taco Bell is just changing up who supplies their crunchy taco shells, and to a supplier with which they share a corporate family history. Pepsi-Co spun off Taco Bell as part of Yum brands, and owns Frito-Lay, which owns Doritos.

The chain also already exclusively sells Pepsi at the fountain. Taco Bell gets buzz, sales, foot traffic and upsell opportunities. Doritos gets to plow a huge volume of their chip product in a restaurant setting. A Doritos Locos Taco runs $1.29, and $1.69 for a Supreme. A regular crunchy taco costs $.99, and a Supreme costs $1.39.

Robert Checkal

The Doritos Locos Taco is a taco inside in a shell made out of Doritos® chip material.

Macy Koch, a social brand strategist in Iowa, whose friends love Taco Bell so much they go there for their birthday parties, doesn't care that the Locos tacos cost more. “I don’t even look at the price,” she said.

“If Taco Bell just said ‘We're offering nacho and cool ranch flavored tacos,' I don't think people would care,” said Ronald Goodstein, an associate professor of marketing at Georgetown University. Nor would it would move the needle if the chips were instead made by, for instance, Utz.

But are diners eating the actual flavor, or are they eating the brand?

“It’s the same,” Goodstein said.

At this point, “Doritos” is a flavor, one that consumers are apparently excited to have surrounding their taco.

However, Jake Hamilton, a 23-year-old web developer in Indiana — and self-described fast food connoisseur — is cool on Cool Ranch. The Locos Taco's "dusty shell doesn't have any of the same flavor as a real Doritos chip," he said.

I recently sampled a Locos Taco and likewise found the Doritos dust on the crunchy shell was much less concentrated than a regular Doritos chip. I believe as a result it packed a more muted flavor than I expected. Still, I ate the whole taco. Then I tried it again on two separate occasions weeks later. Just to be sure.

When a CivicScience online poll with a sample set of 2,503 conducted last week asked “How likely are you to try Taco Bell's new Cool Ranch-flavored Doritos Locos Tacos?” only 6 percent said “very likely,” and 73 percent said “not at all likely.”

However, when the sample set was filtered for self-identified “Taco Bell Lovers,” 36 percent said “Very likely.”

“It's the exact opposite of the health trend,” said Goodstein. Instead, Taco Bell lasered in on its core customer base, figured out what they love, and gave them more of it. More flavor. More “excitement.” 50mg more sodium.

At a meeting with investors in May 2012, Nation's Restaurant News reported Taco Bell's CEO Greg Creed told the audience that its customers have changed their thinking from “food as fuel” to “food as experience.” Creed said, “to be a better Taco Bell, the obvious solution was the Doritos Locos Tacos.” Qithin 10 weeks of their launch, The chain sold 100 million Locos Tacos 

Creed added, “People love it, it’s driving frequency among our heavy users, and we’re selling it at a 30-cent premium. … It’s really a platform we can build off, not a one-off LTO [limited time offer]."

The CEO announced Taco Bell will launch “Flamas” flavored Doritos Locos Tacos in the latter half of 2013. He predicted selling 300 million Locos Tacos next year. 

Dino Baskovic

A Martha Stewart taco – perhaps with doily patterns cut in the wrapping – wouldn't make sense. A Doritos taco, on the other hand, makes a lot of sense, especially when you consider the two brands' shared corporate family history.

Therefore, Taco Bell doesn't care if you think all this is gross. For years now, fast-food chains have been honing in on the loyal subset of their customer base that drives most of their sales.

In restaurant-speak, these are the “heavy users” and “super heavy users.” Burger King's research showed that their top 15 percent of customers drove 40 percent of their sales, prompting a focus on the “superfan” and launching such culinary creations as the 1,310 calorie BK Ultimate Breakfast and “Stackers,” with double, triple and quadruple patties, heaped with yet more meat.

Playing directly to the hungers of this hardcore user base is like fast-food chain “Moneyball" — a reference to the 2003 book and 2011 movie of the same name that tell the story of how the 2002 Oakland A's beat their richer competitors by tossing out conventional measurements of player performance. Instead the A's front office honed in on numbers like on-base percentage and slugging percentage. Their analytic approach, also known as "sabermetrics," showed these statistics were the real drivers of what truly wins ball games: scoring the most runs.

The analog for fast food is that chains have figured out it isn't customer service, great specials, or fast, friendly, service that really gets customers coming back. It's more bacon. Or slapping two kinds of junk food together into an irresistible, crave-inducing combination and charging a markup.

"[Taco Bell] hit the grand slam," Rob Stone, vice president of licensing at Excel Branding, told TODAY. "They can just work on this project for the next 10 years."

YUM Brands

Taco Bell's slogan could take on a whole new meaning.

It sounds like a setup for a joke: Hey, did you hear the one about the high school swim champ who got Taco Bell to make him a customized Speedo?

It’s not a hoax, though — more of a lesson in the power of social media marketing and teenage chutzpah.

The week before Christmas, 15-year-old Ryan Klarner posted on Taco Bell’s Facebook page, introducing himself with a rundown of his swimming and diving achievements before making an offbeat request.

“[I]s there any way you guys could make me a customized Speedo that says think outside the buns on the back of it? If you did, that would mean the world to me,” the Illinois teen asked.

Taco Bell, a division of Yum! Brands, Inc., is quick to respond to gripes as well as kudos on its Facebook page. It also isn’t afraid to dive into the silly or the weird in the running conversation it has with its 9.5 million fans, but a request for a customized swimsuit was a new one, said Tressie Lieberman, director of digital and social engagement.

Klarner said he first came up with the idea a couple of years earlier and decided last month to go ahead and ask, even though he never had asked a company on Facebook for anything before. “I did not expect it to blow up as much as it has. I didn’t really expect to get the Speedo out of it, either,” he said.

But last Wednesday, the social media team at Taco Bell wrote back. “What size do you wear? And what’s your address?”

“He really wanted something and he went after it,” Lieberman said. When we think people are really extraordinary... then we want to reward them.”

Klarner said he was “really surprised” and “ecstatic” to hear back from the company after nearly two weeks. (The reply took as long as it did because the Taco Bell team was trying to track down a purple Speedo and come up with a design.)

“Beyond what we’re putting out to the masses, we want to engage with everyone individually,” Lieberman said. “It’s tough to respond to every single person... but we definitely want to make sure people know we’re listening.” When the company discontinued its fire-roasted salsa last year and fans protested, Lieberman said her team rounded up the final shipment and mailed out individual packages to those who posted the most vociferous objections.

In general, Taco Bell’s Facebook fans aren’t shy about asking for stuff: free food, branded merchandise, even jobs — but Lieberman said Klarner’s request, which racked up thousands of “likes” from other fans, caught her team’s attention.

“We’re seeing a lot of engagement with posts put on our wall by other fans. We really wanted to show Ryan we listened to him,” she said.

Since another element of social media is its immediacy, a quick turnaround was also a priority; even with the difficulty of tracking down a purple Speedo, Lieberman said Klarner will be getting his wish granted this week.

Klarner is actually getting two Speedos — since his request incorporated Taco Bell’s old tagline, “Think Outside the Bun,” Lieberman’s team also decided to give Klarner a second swimsuit with “Live Mas,” the slogan it adopted last year, printed on it.

Rules against corporate sponsorships will prevent Klarner from wearing the suits in competitions, but he said he’ll wear them to practices, where the rules are looser and his teammates have a tradition of wearing funny Speedos.

“But this is just way bigger than that,” he said. “I already loved Taco Bell to begin with... now it’s even more of a favorite." He said the chain's status had risen in his friends' eyes, too. "No one thought Taco Bell was this cool.”

From a marketing perspective, that scores a perfect 10.

Taco Bell

For any locations closed because of Superstorm Sandy, Taco Bell announced that they'll set up a later date for customers to get their free taco.

Beat the post-hurricane blues with a free taco today, Tuesday, October 30th, at Taco Bell from 2-6pm. The chain is giving away one free Doritos Locos Taco to every customer as part of its "Steal a Base, Steal a Taco promotion."

Taco Bell promised that if a base was stolen during the World Series, it would give away a free taco. Sunday night, in the eighth inning of Game 2, the San Francisco Giants's Angel Pagan stole second base. In so doing, he "effectively stole free Doritos Locos Tacos for the entire country," Taco Bell said in a press release.

For stores closed today due to the storm, a Taco Bell spokesperson told NBCNEWS that they will give out free Doritos Locos Tacos at a later date, not yet determined.

"While we want everyone to get their free Doritos Locos Taco, our top priority is the well being of our team members and customers during this massive storm," Taco Bell told NBCNEWS.

It's a good idea to call ahead first to find out if the store is a) open and b) taking part in the giveaway. NBC News called several locations in New York and New Jersey and got no answer on Tuesday morning. Locations in Indianapolis, Indiana, however, west of Sandy's major impact, were open and participating.

Use common sense based on information from public safety officials and authorities in your area. Flooded roads and downed power lines aren't worth risking for a free taco, no matter how deliciously addictive you find its crispy Dorito shell.

Terry Gilliam / AP

Full speed ahead. Wendy's drive-thru came in first in a survey of the fastest, fast-food restaurants.

More money and business news:

• Job seekers find warm welcome in Plains states
• Goodyear gets a bit too edgy with Lohan letter
• Listing of the Week: Which of these 2 islands will you buy?
• Video: You can still get free checking — here's how
• Sign up for our Business newsletter

Follow NBCNews.com business on Twitter and Facebook

AP

This product image provided by Taco Bell Corp., shows Taco Bell's new Johnsonville sausage and egg wrap, one of the items the fast-food chain will be offering on its new breakfast menu which debuts Thursday, Jan. 26, 2012.

It's getting a little crowded in the breakfast nook.

Fast food chain Taco Bell announced Thursday that it's entering the breakfast fray. It joins larger rivals such as McDonald's, Wendy's and Subway in a market saturated with breakfast options including specialty coffees to lure in addicts who’ll buy a breakfast sandwich along with that daily cup of joe.

Irvine, Calif.-based Taco Bell, which is known for its low price points and late night hours, is introducing a breakfast menu at nearly 800 restaurants across 10 Western states, including California and Arizona.

“This is a very important launch for our brand,” said Brian Niccol, Taco Bell’s chief marketing and innovation officer, in a statement. “While we're beginning in the West, where people grew up with breakfast burritos, we plan to reach a national audience in the future, becoming a part of their morning routine, and truly opening people's minds and taste buds as they begin to open their eyes and take on the day."

Notably, Taco Bell’s breakfast offerings include well-known brands like Tropicana, Cinnabon, and Seattle’s Best Coffee, which may serve to alleviate customer concerns about food quality following a 2011 lawsuit in which the contents of Taco Bell’s beef were called into question. 

“It helps with one of the issues that they need to content with, which is quality,” said David Morris, an analyst for consumer goods research firm Packaged Facts. “That’s a smart move.” 

The chain plans to open its drive-through locations an hour earlier than normal for breakfast, generally around 8 a.m. or 9 a.m., and will offer breakfast until 11 a.m. It aims to roll out its breakfast menu on the East Coast in 2013, and will begin experimenting with offering breakfast foods during late-night hours in late 2012.

Fast food breakfast has turned into one of the swiftest growing areas in the entire restaurant industry, and Taco Bell competitors like McDonald’s, Wendy’s and Subway have already successfully rolled out breakfast menus. A 2010 report from NPD Group found that breakfast accounted for 60 percent of the restaurant industry’s growth over the last five years, with breakfast traffic increasing by an average of 2 percent per year. Lunch traffic, was largely flat, while dinner traffic decreased by an average of 2 percent per year during the same five-year period. 

Despite the already-crowded market for breakfast, Taco Bell’s low price points and its Mexican food-tinged variation on the traditional breakfast offering should serve it well in the battle over breakfast, experts say.

“Taco Bell has done a great job at being an industry leader in that category,” said Darren Tristano, executive vice president of Technomic, a food and beverage industry research firm. “If you have a good coffee offering like many of the successful chains have, you can then provide a differentiated product because of the Mexican food offering.”

He added, “Younger Americans, specifically millenials, are looking for not only spiciness at breakfast, but also the cheaper price point.”

Taco Bell has some catching up to do, however. McDonald’s is already raking in a hefty 27 percent of its $33 billion in annual sales at breakfast, according to Tristano.

It could serve as a slightly cheaper alternative to some of its competitors. Among Taco Bell’s new breakfast offerings are sausage or bacon and egg burritos for $1.49, grand skillet burritos for $2.79, and $3.99 combo meals containing a breakfast item with a drink and hash browns. That’s slightly less than breakfast combo meals elsewhere, which tend to approach $5 and up.

Another plus for Taco Bell that stands to help it capture part of the breakfast market is its already-established drive-thru presence, as well as its decision to sell Seattle's Best Coffee, which Packaged Facts’ Morris says is one of the major reasons for the growth of sales in the breakfast category. “The magic of coffee is that it’s been one of the few products that people have been willing to pay more for both before the recession and after,” he said.

Taco Bell later opening hours versus competitors could be a problem, though. “A coffee drinker is going to go elsewhere if they [Taco Bell] don’t open early enough,” Morris said. “They’ll need to contend with that in order to compete with more established limited-service breakfast players.”