They’ll Call it "American Food"

Yum Brands Inc. (Louisville, Ky.) has announced that its Taco Bell division is re-entering the Mexican market with two new stores in Monterrey, Mexico’s third-biggest city.

The Mexican-themed fast-food operator has opened in the solidly middle-class Monterrey suburb of Apodaca, an area where residents may not have traveled to the United States. Its second store will also be in suburban Monterrey. The company said it will open between 8 and 10 more locations in 2008, with plans to eventually reach 300 stores. The first stores will be company-owned, while franchise opportunities will open up in later years.

“We want to appeal to consumers who haven't tried Taco Bell, for whom this would be their first experience with Taco Bell,” said Javier Rancano, the company's director in Mexico.

According to a report by the Associated Press, the company's branding strategy — “Taco Bell is something else” — is an attempt to distance itself from any comparison to Mexico's taquerias, which sell traditional corn tortillas. It plans to project a more “American” fast-food image by adding french fries to the menu at its first store, which opened in late September. “Our menu comes almost directly from the U.S. menu,” said Yum Mexico managing director Steven Pepper.

However, the company will re-name its taco as a “tacostada,” a made-up word to protect the sacred taco that holds a place of honor in the Mexican national cuisine.

Taco Bell has also taken pains to say that it's not trying to masquerade as a Mexican tradition. “One look alone is enough to tell that Taco Bell is not a taqueria,” the company said in a half-page newspaper ad. “It is a new fast-food alternative that does not pretend to be Mexican food.”

Taco Bell failed with an earlier, highly publicized launch in Mexico City in 1992. The restaurants didn't even last two years. But, the company says, Mexicans were less familiar with foreign chains back then and the economy was on the verge of a crisis. The North American Free Trade Agreement had yet to be signed. Since then, free trade and growing migration have made U.S. brands ubiquitous in Mexico.