Dive Brief:

• Taco Bell will open a Cantina in New York City's Times Square on Wednesday, joining about 60 Taco Bell units and over 20 Cantinas open across New York's boroughs, according to a press release. It has over 200 restaurants in the greater New York metropolitan area and plans to add 25 restaurants to the region this year, representing 10% of the chain's development mix.
• The new location offers digital-only ordering at 10 kiosks, which replace traditional analog menu boards, as well as 15 order-ahead pickup cubbies.
• Taco Bell's newest Cantina follows the opening of its first drive-thru Cantina in Danville, California, and the rollout of its Go Mobile stores. Taco Bell aims to have 10,000 restaurants open globally by the end of the decade.

Dive Insight:

Taco Bell has been experimenting with different store models to enhance the guest experience, especially as patrons increasingly prefer more digital experiences. This new Cantina model could be particularly effective in metro locations that don't have the space to accommodate the double drive-thrus that are part of its Go Mobile models. 

The pickup cubbies allow guests to enter their order numbers on a touch screen and grab their items from a designated, glowing cubby. The kiosk ordering will also let customers have a contactless ordering experience, which has grown in prominence during the pandemic, and allow employees to be deployed elsewhere in the restaurant. 

Digital, in general, is becoming a growing business for Taco Bell. Aided by the launch of its loyalty program last summer and its expansion of delivery with new aggregators, digital sales made up 12% sales mix during Q4 2020 and accounted for about $1 billion in sales for all of 2020, Yum Brands CEO David Gibbs said during the company's Q4 2020 earnings call. Customers weren't just ordering digitally last year, however. During Q3 2020, Taco Bell processed 30 million more cars through its drive-thru, year-over-year, showing the importance of improving all of its channels to better service more customers. 

Taco Bell isn't the only chain turning toward digital-focused stores. Chipotle opened its first digital-only location last year, while McDonald's, Burger King, Del Taco and KFC are among the food chains developing prototypes to enhance the digital and drive-thru experience.