The Impact of $5 Meal Deals on Fast Food Chains
Fast food chains like McDonald’s, Burger King, and Wendy’s have found success with their $5 meal deals, attracting more customers and boosting store traffic.
In response to a disappointing first quarter, McDonald’s introduced the $5 value meal in June, initially planned to last for a month but has now been extended until December at most U.S. stores. The meal includes a McDouble burger or McChicken sandwich, small fries, a four-piece Chicken McNuggets, and a small drink.
Rivals like Burger King and Wendy’s quickly followed suit with their own $5 meal deals, indicating the effectiveness of this pricing strategy in attracting customers. Burger King recently extended its deal through October, while Wendy’s added a free Frosty to their $5 meal deal in June and has now introduced a new deal targeted at college football fans.
Research from Placer.ai, which tracks retail traffic using cellphone data, shows that the $5 meal deals have led to increased visits to these fast food chains. U.S. visits to McDonald’s rose by 2.5% in June after the introduction of the $5 meal deal and have remained elevated ever since. Similarly, Taco Bell saw a 12.3% increase in visits when they offered free drinks to celebrate the 20th anniversary of their Baja Blast drink.
Other food chains are also offering deals to attract customers. Domino’s Pizza recently announced a promotion where customers can upgrade a medium pizza to a large for free when they purchase two medium pizzas for $6.99 each. Olive Garden is running its Never-Ending Pasta Bowl special through November, and McDonald’s has plans for more deals this fall, including free medium fries every Friday and $1 10-piece Chicken McNuggets between November 4 and December 2.
With the success of these $5 meal deals, it is clear that affordable pricing strategies are key to driving store traffic and retaining customers in the competitive fast-food industry.
