Menu Innovation Misfires in 2025: Four Bold Moves That Quickly Backfired
Four ambitious menu and channel bets—by Sweetgreen, Krispy Kreme, Portillo’s, and Denny’s—surged, then reversed as operational friction and thin margins surfaced within months.
Photo by Anna Keibalo on Unsplash
The Year Novelty Outran the Line
In 2025, novelty arrived with the bravado of a parade drumline and the delicacy of a soufflé—only to discover that kitchens and cost structures tolerate little excess motion. Chains sought to seduce the diner with limited‑time offers, cross‑brand reach, and new dayparts; these were ambitious strokes on a crowded canvas. The promise was scale, buzz, and the glint of fresh revenue against familiar formats. Yet the coda was abrupt: what began as momentum became a study in constraint. As one summary put it, “Bold menu bets fizzled as execution and economics collided.” The four stories that follow—Sweetgreen’s Ripple Fries, Krispy Kreme’s doughnuts in McDonald’s, Portillo’s breakfast test, and Denny’s value architecture—share a recognizable rise and retreat. Each launched quickly, expanded with confidence, and encountered friction inside a few reporting cycles. The drama unfolded in dates and unit counts, but the substance was more tactile: an extra prep step in a cramped line, a delivery window too narrow for the route, a staffing pattern that bent the clock, a deal so combinable that margins thinned to translucence. The lesson is not asceticism but discipline, the culinary equivalent of seasoning with a steady hand. Analysis: The opening situates four initiatives within a unified arc—rapid rollout followed by operational and margin pressure—anchored by the stated collisions of execution and economics.
A Health Halo Meets the Fryer
Sweetgreen’s Ripple Fries debuted on March 4—crinkle‑cut, air‑fried in avocado oil, and promoted as seed‑oil free. The positioning was sly and modern: indulgence reframed for the wellness‑minded guest, a garnish of virtue against the classic siren song of the fry. Cofounder Nicolas Jammet cast the move with missionary zeal, calling the item “redefining what fast food can be.” CEO Jonathan Neman reported that the fries quickly became the chain’s most attached side, lifted March same‑store sales, and broadened the meal experience. For a brand trained on leafy abundance, the pairing read like a deft course progression, a briny oyster before the verdant salad. The mechanics were just as deliberate: an avocado oil air‑fry, a seed‑oil‑free claim, and the insertion of a new step into a famously choreographed assembly line. Early KPIs suggested the gamble was working. Yet tests later showed that discontinuation increased customer satisfaction and lightened task loads, a quiet confession that every additional movement matters when the mise en place is built for speed. The very success of attachment may have been a Trojan horse; flow buckled under its popularity. Analysis: The section documents the intent—indulgence aligned with wellness—and the initial attachment lift, then highlights test results showing that removing the item improved satisfaction and labor flow.
Five Months to a Reckoning
Within five months, the balance sheet told a sterner tale. Restaurant Dive reported a “7.6 percent” same‑store sales decline and “operational losses soaring to $26.4 million (‑14.2 percent margin).” The company moved to phase out the fries by August 2025 and enacted support‑center layoffs of “roughly 10 percent,” a cost‑containment step that echoed the broader shift toward simplification. The retreat wasn’t attributed to supply or taste but to integration complexity; removing steps and SKUs relieved bottlenecks and, in test, improved satisfaction. Even in contraction, the brand outlined a tempered path forward. Plans for “at least eight” seasonal or limited‑time‑offer moments in 2026 suggest the appetite for innovation remains intact, now bracketed by stronger integration controls and the discipline of seasonal cadence. In the language of the European dining room, it’s the pivot from a groaning board to a tasting menu: fewer courses, clearer intent, and a brigade focused on execution rather than novelty for novelty’s sake. Analysis: The figures and dates underscore how quickly costs overtook benefits and how the company linked simplification, layoffs, and a more controlled LTO strategy to restore operational clarity.
Krispy Kreme’s Ambitious Pairing Unravels
Krispy Kreme’s foray into McDonald’s began as a textbook case of brand synergy: glazed doughnuts placed into “approximately 2,400” restaurants, extending pilot success into a wide national footprint. The logic sparkled—fill the bakery gap left by McCafé, promise “2026” national access, and let a hub‑and‑spoke distribution engine hum at a grander tempo. In practice, the choreography strained. Matching delivery cadence, freshness windows, and wildly variable store‑level demand across a vast system proved exacting. Leadership put the problem plainly. CEO Josh Charlesworth acknowledged that aligning cost with unit demand was unsustainable, a blunt diagnosis that the economics of frequent drops and uneven velocities eroded profitability. Expansion was paused by May and terminated in June, effective July 2, 2025—a rapid unwind later confirmed by CNBC and AP. The company withdrew full‑year guidance and signaled a redirection toward high‑volume retail and international franchises, channels where per‑unit throughput and pricing power can better honor the cost of the craft. For McDonald’s, the doughnuts were a small, non‑material piece of breakfast; the partnership’s scale did not guarantee margin for the supplier. Analysis: The chronology and admissions clarify that logistics and unit‑level demand mismatches undermined the collaboration, prompting a swift exit and a strategic refocus on more profitable channels.
Portillo’s Tests Breakfast, Then Retreats
Portillo’s approached the morning daypart with caution wrapped in confidence. The breakfast test began in April, broadened by June, and—by September—was shelved. The aim was classic: unlock incremental morning sales without cannibalizing lunch and dinner. Early readouts suggested the sales were additive. Yet the burden of staffing patterns and layered supply intruded, a set of hidden complexities that can turn even a small pilot into a knotted shift schedule. The Chicago‑based effort was operationally small, but its signal was outsized. Adding a daypart is not merely a clock change; it is a new language of labor, a fresh lattice of prep, waste, and deliveries. Less than two weeks after breakfast was shelved, then‑CEO Michael Osanloo resigned, a tight sequence that reinforced the turbulence that followed the test’s reversal. The arc demonstrates that even when demand is cooperative, the choreography of people and product may still render the dance uneconomical. Analysis: The dates and leadership change frame a tidy narrative: incremental sales could not offset staffing and supply layering, catalyzing a quick reversal and accompanying executive turnover.
Denny’s Finds the Limits of Tiered Deals
Denny’s restored its $2/$4/$6/$8 value menu with the promise of clarity and choice, a neat architecture designed to invite traffic while guarding profitability. Leadership praised the approach as consumer‑friendly and traffic‑driving. But the dining room has its own ingenuity. Guests “hacked” the pricing architecture by stacking deals, exploiting combinability in a way that diluted the intended margin. The response was swift and seasonal. The brand pivoted to a summer Slams promotion, tightening the aperture to a time‑bound construct that could defend traffic without leaving the door ajar to endless stacking. In pricing, as in pastry, structure is everything. A mille‑feuille holds because each layer is calibrated to the next; so too must deal layers be designed to resist collapse under creative assembly. Analysis: The episode illustrates how perceived simplicity can be gamed in practice and why constraining duration and combinability helps preserve pricing integrity and margins.
From Store Floors to Strategy Rooms
The leaders of these efforts began with fluent optimism: brand stretch, attachment, and access. They ended by listening to the metronome that matters—store‑level feedback. Sweetgreen found that removing fries boosted satisfaction and lightened task loads; Krispy Kreme confronted delivery economics that bent out of shape at the unit level; Portillo’s learned that even incremental breakfast sales can be overmatched by staffing and supply layering; Denny’s saw that open‑ended combinability undermined a tidy value design. These are not failures of imagination so much as reminders that the kitchen line, the route map, and the check average all impose a house style. Industry patterns come into sharper focus through these reversals. Partnerships demand unit economics as tight as brand alignment. Dayparts require labor models that do not fray at the edges. Value must have firm borders. Sweetgreen’s forthcoming plan for “at least eight” seasonal or limited‑time‑offer moments in 2026, paired with better integration controls, captures the broader counsel: innovate inside the bandwidth of the operation, and validate integration before pressing the accelerator. The melody remains inventive; the tempo must be controlled. Analysis: The synthesis ties early rhetoric to operational outcomes and highlights the strategic adjustments—guardrails on innovation, channel selection, and pricing architecture—that emerged from the reversals.