Why is McDonald's So Active Right Now?

Why is McDonald's So Active Right Now?
  • McDonald's recently launched its new tiered dollar menu, promoting it with funny, relatable ads.

  • The new $1 $2 $3 Dollar Menu is just one of the many ways McDonald's is trying to win back customers.

 

Competitors like Wendy's and Taco Bell heard about the move by McDonald's and, in anticipation, began promoting their own dollar menus. Read more about the Golden Arches' strategy here.

On this episode of On Foodable Weekly: Industry Pulse, we're taking a look at McDonald's new $1 $2 $3 Dollar Menu. The menu is just one of the many ways McDonald's is trying to win back millions of customer visits. The fast-food chain has also renovated a number of locations and will be launching their new fresh beef burgers nationwide later this year.

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McDonald’s Commits to New Tiered Dollar Menu

McDonald’s Commits to New Tiered Dollar Menu

McDonald’s just launched its new $1 $2 $3 Dollar Menu across the US hoping to win back the nearly 500 million customer visits it says it’s lost since 2012. In addition to the remodeling of established restaurants, updating its menu with items like the buttermilk crispy chicken tenders and rolling out mobile ordering, the new tiered value menu is expected to help the fast food giant bounce back.

And their efforts are already showing some promising results. After a sustained decrease in visits between 2013 and 2016, McDonald’s showed a healthy jump in comparable sales in the second and third quarters of 2017, according to “Ad Age”.

This new tiered menu is the latest of McDonald’s price focused menus. Back in 2002, the chain launched its Dollar Menu where it offered eight items for a dollar each. Since then different types of menus have been shuffled across the board such as the Extra Value Menu, the Dollar Menu and More, and the You Pick Two menu.

The new $1 $2 $3 Dollar Menu is being promoted nationwide with TV, radio, digital and social campaigns all sharing the same funny and relatable storylines. The campaign, expected to run about six to eight weeks, will also be supported later in the year, as well as into 2019. "It's one that we are not going to walk away from," says U.S. Chief Marketing Officer Morgan Flatley.

Competitor chains like Taco Bell and Wendy's, aware of McDonald's plans for the $1 $2 $3 Dollar Menu, also introduced new or updated low-priced offerings this month. For example, Taco Bell is promoting the variety of $1 items it sells and will introduce $1 Nacho Fries on Jan. 25.

The $1 $2 $3 Dollar Menu is now offering a choice of a sausage burrito, McChicken, cheeseburger, or any size soft drink for $1. For $2, customers can get Sausage McGriddles, 2-piece Buttermilk Crispy Tenders, a Bacon McDouble, or a small McCafé beverage. For $3, there's the Sausage McMuffin with Egg, the new Classic Chicken Sandwich, the Triple Cheeseburger, and a Happy Meal.

Later this year, McDonald’s will be introducing new "hot off the grill" fresh beef to its menu, which will also receive a heavy promotional campaign. You can read more about McDonald’s new menu on “Ad Age.”

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Taco Bell Unveils Dollar Menu: Another Jab at McDonald's?

Credit: McDonald's

Credit: McDonald's

What does value mean to you in QSR foodservice? Is it defined by the quality of ingredients? Speediness? Price? Customer service? 

It’s probably a combination of the above.

Big QSR brands like McDonald’s are switching up their Dollar Menu strategy (most of the offerings aren’t even $1, but rather in the $2-$5 range), putting more of an emphasis on value — because maybe $1 seems “too cheap” for a meal you’re trying to promote as “higher quality.” But just like the epic QSR Breakfast Battle (not to mention its viral "Ronald McDonald" campaign), Taco Bell is taking this opportunity to win customers. The fast food chain is adding a Dollar Cravings menu (where everything on the menu is actually $1) to its offerings. Interestingly enough, most of Taco Bell’s Dollar Cravings menu items are getting marked up. But when you’re still paying only $1, does this really matter? It’s all about value perception, and Taco Bell is giving McD’s a run for its money. Pun fully intended. Read More