Dive Brief:
- McDonald’s will bring back Extra Value Meals as a menu category on Sept. 8, expanding its value options, the company said in a Tuesday press release.
- For a limited time in conjunction with the revival of the menu category, the Golden Arches will offer a $5 Sausage McMuffin with Egg meal, which includes hash browns and a small coffee, and an $8 Big Mac meal, which includes medium fries and a medium soft drink.
- The Extra Value Meals include eight meal options across breakfast, lunch and dinner that are priced 15% lower compared to purchasing the individual items, the company said.
Dive Insight:
The Extra Value Meals come over a year after the chain first offered its $5 Meal Deal and about nine months after it launched its McValue platform, which continues to drive incrementality, CEO Chris Kempczinski said during an August earnings call. The company also added the Daily Double to its McValue platform and now offers three Meal Deals starting at $5. While these various deals boosted its value offerings, Kempczinski said that the chain also recognizes “that consumers’ value perceptions are most influenced by core menu pricing.”
According to The Wall Street Journal, the individual components of a Big Mac Meal can cost as much as $13.47. Comparatively, a meal runs at about $12 in New York City and over $13 for Big Mac a la carte and meals in the San Francisco Bay Area. With fast food meal menu price inflation in the double digits over the last few years, chains like Chili’s have been boosting traffic and same-store sales with menu items like its $10.99 3 for Me meal. Earlier this year, Chili’s created a pop-up shop in New York City that took a dig at fast food pricing by offering fast food financing.
McDonald’s had been working with its domestic franchisees to address pricing concerns across the entire system, Kempczinski said. The Extra Value Meals mark the chain’s first change to core menu pricing. McDonald’s also agreed to offer financial support to franchisees as part of the push to lower prices, according to The Wall Street Journal.
“Bringing back Extra Value Meals reflects the company and franchisees' shared commitment to offering everyday affordable prices,” Danielle Marasco, a McDonald's owner/operator and National Franchisee Leadership Alliance chair, said in a statement. “We're working together to keep the menu items our customers love affordable for everyone in the communities we serve.”
In November, McDonald’s will expand on the Value Meals platform by offering $5 Sausage, Egg and Cheese McGriddles and $8 10-piece Chicken McNuggets Meals. The chain is also offering Snack Wraps at $2.99 through the end of the year, the company said.
Value, along with menu innovation and the expansion of McDonald’s loyalty program, helped drive an increase of same-stores sales of 2.5% in the U.S. during the second quarter of this year. McValue and loyalty accounted for 50% of visits in the U.S.
