Fast-food price fight: Combo deals take centre stage

NEW YORK -- Another price fight is breaking out among the country's biggest burger chains, this time with meal combos designed to make people forget about the once ubiquitous dollar menus.

See Full Article

The new "bundled offers" show how hungry McDonald's, Burger King and Wendy's are to win over deal seekers, and how quickly a popular idea gets copied in the fast-food industry. The latest trend on the value front popped up in late 2015 after Wendy's rolled out a "4 for $4 deal," which includes a Jr. Bacon Cheeseburger, chicken nuggets, small fries and a small drink.

This week, Burger King followed with a similar "5 for $4" deal, and McDonald's introduced a "McPick 2 for $2" deal to kick off the new year.

"People look at what other folks are doing, and if they think they're getting traction, they say we need to do a version of that," said Tony Pace, former chief marketing officer at Subway who now runs a marketing consulting firm.

Though typically not big profit generators, promotional deals can steer people in the door who might not have stopped in otherwise. And chains do their best to make sure regulars stick to the pricier meals they usually order. At a New York City McDonald's, an employee said she was told not to suggest the $2-for-2 deal, but wait for people to order it on their own.

The additional food tacked onto those bundled orders helps drive up sales as well. That's what happened when Burger King tested its "5 for $4" deal in recent months, said Alex Macedo, who heads the chain's North America business.

"We believe it's going to be very profitable for franchisees," Macedo said in a phone interview.

The new deals come after fast-food chains struggled to raise prices on value menus without scaring off customers, even as commodity costs rise.

McDonald's shifted from its hugely popular Dollar Menu to a "Dollar Menu and More" that featured a range of prices. Steve Easterbrook, who took over as CEO this past March, conceded the company's failure to come up with an adequate replacement for the Dollar Menu has hurt sales.

The company has said deal seekers still make up about 15 per cent of the industry.

For now, McDonald's said the "McPick 2 for $2" will run for five weeks, and that the details of the McPick offer will evolve over time. Burger King and Wendy's haven't said when their limited-time offers will end.



Advertisements

Latest Economic News

  • Coca-Cola CEO Muhtar Kent to step down next year

    Economic CTV News
    NEW YORK -- Coca-Cola said Friday that CEO Muhtar Kent will step down as CEO next year and be replaced by Chief Operating Officer James Quincey. The world's largest beverage maker is under pressure to grow as people around the world drink less soda, including its flagship Coke. Source
  • U.S. airlines may soon let you talk on your cellphone in flight

    Economic CBC News
    Airlines could let passengers make in-flight phone calls using Wi-Fi under a proposal from federal regulators. Flight attendants and others have complained that the calls could be disruptive. But the Department of Transportation said Thursday that it envisioned allowing the calls if airlines tell all customers about the policy when they buy their tickets. Source
  • Tribes suing over Dakota Access pipeline willing to put claims on hold

    Economic CTV News
    BISMARCK, N.D. -- Two Sioux tribes suing over the Dakota Access pipeline say they're willing to put their claims on hold while the Army considers whether to allow the pipeline to cross under a Missouri River reservoir in North Dakota. Source
  • Japan ratifies Pacific trade pact despite Trump plans to withdraw U.S.

    Economic CTV News
    TOKYO -- Japanese Prime Minister Shinzo Abe won parliamentary approval Friday for ratification of the Trans-Pacific Partnership, despite U.S. President-elect Donald Trump's plan to withdraw from the 12-nation trade pact. Upper house lawmakers approved the TPP on Friday, heeding Abe's calls to push ahead with it despite Trump's rejection of the free-trade initiative championed by President Barack Obama. Source
  • Asian shares stumble as European Central Bank rally fades

    Economic CTV News
    KUALA LUMPUR, Malaysia - Asian shares meandered Friday as an overnight rally in U.S. markets helped by the European Central Bank's decision to extend its bond-buying economic stimulus program faded. South Korea's benchmark slipped as lawmakers prepared to vote on whether or not to impeach President Park Geun-hye. Source
  • Global stocks extend European stimulus-inspired rally

    Economic CTV News
    KUALA LUMPUR, Malaysia -- Global stocks continued to rise Friday as investors remained buoyed by the European Central Bank's decision to extend its bond-buying economic stimulus program. South Korea's benchmark slipped as lawmakers voted to impeach President Park Geun-hye over a corruption scandal. Source
  • Sales, profit at Sears in U.S. continue to decline

    Economic CTV News
    HOFFMAN ESTATES, Ill. -- Sears, the one-time standard bearer for U.S. retail, has posted quarterly losses for more than a year now, and sales continue to slide as the company shutters poorly performing stores. The company's cash situation, which has led in the past to clashes with suppliers, is an ongoing concern. Source
  • Stock markets in New York hit new record highs

    Economic CBC News
    Major stock markets in New York closed at record highs Thursday amid a broad rally from banks, materials and technology companies. The Dow Jones industrial average advanced 65.19 points at 19,614.81, while the S&P 500 added 4.84 points at 2,246.19, both hitting all-time highs for a second day in a row. Source
  • BlackBerry launches new security platform to help companies manage connectivity

    Economic CTV News
    WATERLOO, Ont. - BlackBerry revealed its latest security offering on Thursday intended to help companies reliably manage their current and future connectivity needs. The company's new platform, BlackBerry Secure, is designed to help businesses keep tabs on all their devices to transmit sensitive data to keep people, information and goods safe. Source
  • NHL won't change name of Vegas Golden Knights despite trademark denial

    Economic CBC News
    The National Hockey League says it won't change the name or logo of its newest club, despite being denied a trademark by U.S. authorities. Just a couple of weeks after the Vegas Golden Knights revealed their name, logo and team colours, the U.S. Source