Dive Brief:

• McDonald’s will launch a $5 Meal Deal beginning on Tuesday for a limited time at participating McDonald’s restaurants nationwide, the company said in a press release.
• The meal includes a McDouble or McChicken sandwich, small fries, four-piece Chicken McNuggets and a small drink. 
• The meal deal is part of McDonald’s strategy to offer a national value platform similar to what competitors provide. Even though it offers a $1 $2 $3 Dollar menu, the chain’s value menus focused more on local operators’ approaches instead of one unified strategy, executives said during the company’s Q1 2024 earnings call.

Dive Insight:

McDonald’s reported drops in traffic across the country as consumers pulled back on restaurant spending, and is now hoping to alleviate these iclaiming McDonald's prices have risen 100% since the onset of the COVID-19 pandemic. McDonald’s USA President Joe Erlinger fought back against those claims at the end of May, claiming that the reports and social medissues with a clear value proposition, executives said. McDonald’s is facing a pricing perception problem, with reports a posts were “poorly sourced” and “inaccurate.” 

In addition to the $5 Meal Deal, the chain is instituting “Free Fries Friday” every Friday nationwide through the end of 2024 for mobile orders. Customers who make a minimum purchase of $1 are eligible to receive a medium fries, as stated in the press release. On National French Fry Day — July 13 — the chain will provide free fries of any size, no purchase necessary. 

The company also highlighted various local value promotions undertaken by franchisees, including a Buy One Get One for $1 breakfast sandwiches in Memphis, Tennessee, a double cheeseburger and small fries for $3.50 in Columbus, Ohio, and a mix-and-match McChicken and McDouble offer for $3.99 in Western New York, per the press release. 

The national value platform will face significant competition as other brands, like Burger King and Wendy’s, offer meal deals this summer. Burger King’s $5 Your Way Meal is expected to run for months, CNBC previously reported. Initial reporting by Bloomberg on McDonald’s value strategy indicated its promotion might run for about four weeks. Jack in the Box recently launched Munchies Under $4, a combination of new and core menu items, as its value platform. Even c-stores are using value menus to compete. This week, Wawa launched its annual Hoagiefest, a sandwich promotion for $6 or less during the summer.

Still, McDonald’s has seen success in other countries where it has strong value platforms. In Germany, for example, the chain has a McSmart menu, and its Spanish system has an everyday value menu that offers bundles at three different price points, both markets have seen strong results. A focus on everyday value in Poland has helped draw consumers back into restaurants, CEO Chris Kempczinski said during the earnings call. In Q1, McDonald’s launched a McSmart menu in France “with high consumer awareness, which is driving encouraging progress,” he said. 

In these markets, McDonald’s has been working closely with local operators to take a balanced approach to menu pricing alongside affordability and offer more aggressive value options in areas where it is needed, he said. 

“McDonald's has a long history of being the go-to destination for value and it's imperative that we continue to keep affordability at the forefront for our customers,” Kempczinski said. “We literally wrote the playbook on value, and we are committed to upholding our leadership within the industry.”