Popeyes Is Coming for KFC’s Table. It’s Bringing Paneer

Three people want fried chicken. The fourth is scrolling past photographs of it, looking for something she can eat. Someone suggests fries. Someone always suggests fries, usually the person who has already picked a chicken burger and considers the evening settled. By now the person with the phone has opened a second app. The vegetarian was asked to choose a burger. She may end up choosing the restaurant.

I’d like to think this is the scene Popeyes had in mind when it decided that a paneer burger needed an American Mayo Burst, a Korean Burst and a Habanero Burst. The chain also sells Classic and Bold paneer sandwiches, in case the fourth person has had enough excitement just getting everyone to agree on dinner.

The five-burger range launched in August. The reason to look at them again is Jubilant FoodWorks’ November 6 letter to shareholders. The Indian operator says Popeyes added 11 stores in the September quarter, reached 25 cities and grew revenue 122% from a year earlier. Sales at comparable stores grew 53%. Jubilant says average daily sales are broadly comparable with established players in most of the markets it serves. It doesn’t name the players or show us the comparison. KFC, which has spent years teaching Indians to order fried chicken in a bucket, has the most interesting table to defend.

The paneer gets its own page

At Popeyes in Chandni Chowk, the Swiggy listing put a Classic Paneer Sandwich Burger at ₹239 and a Bold one at ₹249. The Classic Chicken Sandwich Burger was also listed at ₹249. If you choose the American Mayo Burst paneer burger, the price goes up to ₹279. The dressed-up paneer is priced ₹30 above the classic chicken on the same menu.

The KFC Connaught Place listing put its Paneer Zinger at ₹259. In Madurai, the KFC listing for KK Nagar showed the Paneer Zinger at ₹239.05. Popeyes in the same neighbourhood listed its Classic Paneer at ₹239 and its American Mayo, Korean and Habanero versions at ₹279 apiece. These are prices from individual outlet menus, before any fees or coupons at checkout. They tell us what the restaurants offered to sell, and give us a better question than which chain is cheaper. When the two entry choices cost about the same in Madurai, what is Popeyes hoping you’ll pay another ₹40 for?

It might be the chance to order something that sounds like the rest of dinner. The group is comparing sauces and deciding how hot it wants its chicken. For once, the person who eats paneer can join that conversation without having to suggest an entirely different cuisine. The August campaign handed the question to comedian Aakash Gupta, whose love of paneer was the premise. A chicken chain asking a paneer enthusiast to take it seriously is a more entertaining admission than a menu announcing that it has something for everyone.

I wouldn’t give Popeyes a medal for discovering the vegetarian. Its first Indian menu in Bengaluru in 2022 already included vegetarian options. KFC has a Paneer Zinger and has promoted it alongside its Veg Zinger. McDonald’s had long since made the potato patty a burger people could ask for by name, even giving the McAloo Tikki a chatpata edition. The new wrinkle is the shelf space Popeyes has given paneer. The product gets a price ladder, an ad and five chances to be the thing someone actually came for.

There’s some care in the way Popeyes names the burgers. In Chandni Chowk the two Classics sit ₹10 apart, and the chicken and paneer both get a Bold version. A person ordering for the table can read the menu in the same vocabulary all the way down. The splashier paneer options get to be the things you debate, the way people debate flavours of wings. A chain doesn’t need to prove its Habanero Burst is the best paneer burger in India for that to be useful. It needs the person who usually asks what else is open to stay on the page for another minute.

KFC can get there first

There’s a risk in reading the two companies’ growth numbers as if they were on a scoreboard above the same pitch. Popeyes’ comparable sales figure applies to eligible stores, and the company has not said how many paneer burgers it sold or how often one appeared in a cart alongside chicken. The 122% revenue increase includes the effect of a growing network. Devyani’s KFC business reported 4.4% same-store sales growth and added 50 net KFC outlets in India in the same quarter. Those figures cover Devyani’s operation, not the whole KFC system in India. They do suggest KFC has plenty to say about how quickly it can put a bucket within reach.

Devyani and Sapphire Foods, the two operators behind KFC in India, are moving towards a merger. The Competition Commission cleared the deal on October 30. Clearance is a step towards a single operator. The appeal for KFC is easy to imagine: a bigger network under one operator could make it easier to repeat a deal, a menu change or a delivery promise across more stores. Whether it can do that well is a separate reporting question. In a group chat where somebody has already sent a screenshot of KFC’s two-piece chicken offer at ₹99, an argument about which restaurant has the better fourth paneer option can end fairly quickly.

Popeyes has an operator that knows this part of the business. Jubilant already runs Domino’s in India, and its letter says it is taking the same approach to building the Popeyes network: choose neighbourhoods carefully and make new restaurants meet its return requirements before it speeds up. More stores in the same area could help bring down the cost of delivery, the company says. It also says Popeyes as a brand still isn’t profitable. The vegetarian range can give a group a reason to try the chain. A nearby kitchen that gets the whole order there hot gives the group a reason to remember it.

This goes back to the Bengaluru launch. The first outlet was in Koramangala, with two more Bengaluru neighbourhoods named in the opening announcement. Jubilant also announced its own Popeyes app and delivery fleet. The useful lesson from Domino’s may be how to make a dinner decision repeatable. A restaurant that reaches one member of the group but won’t deliver to the host’s address has only got halfway there. A restaurant that adds kitchens to the right neighbourhoods can turn an argument about an interesting new sandwich into a place the group orders from again.

That gives us a useful way to think about the KFC response. It could add another paneer flavour if it thought shoppers needed one. It could also make its existing Paneer Zinger easier to spot in a group offer or use a price that makes the choice for whoever is paying. These are options, not responses KFC has announced. The useful question for both brands is how many people have to have a good reason to say yes before a basket stops moving between apps.

The order that matters

Popeyes knows what a single sandwich can do for the brand. In the US, its parent company credited the chicken sandwich with boosting fourth-quarter 2019 sales, when comparable sales there rose 37.9%. It was a product people wanted to try and could name. The Indian paneer test is different. A sandwich can be commercially useful even if the person who picks it spends less than the other people their choice brings along. We would need to see the baskets to know whether that is happening here.

I’d ask Jubilant for the share of orders that contain both paneer and chicken, and whether those baskets have grown since August in stores that were already open. I’d ask how many buyers come back for one of the flavours, and whether the ₹279 versions bring in new orders or simply give the ₹239 customer something else to try. I’d ask KFC the same questions about the Paneer Zinger. We’d learn more from that than from two people on opposite sides of a table declaring which patty is crispier. A menu can also add work at the kitchen. It is possible for one more sauce to keep a diner interested while making the economics of serving that diner a little worse.

There is a human check, too. Some vegetarians happily order from a chicken restaurant. Others want to know how the food is prepared, or would prefer a vegetarian kitchen. Five burgers won’t answer that for them. Even among the willing, a mixed order can come down to whether the paneer item is in stock and whether the discounts work on a cart with both kinds of food. The menu check tells us what each chain is asking for one burger. It would take an order to the same address at the same time to find out what the group actually pays and waits for.

I’d give the person who was offered fries the phone again. Let her see what Popeyes has put on the menu, what KFC has put on offer and how long either will take. Then count the chicken burgers in whichever basket she checks out with.