McDonald's to rename its Dollar Menu
Not everything on the menu will cost $1, but the word 'dollar' was important to have. So the company got a little creative.
By Jim Probasco
After a year's worth of disappointing sales, McDonald's (MCD) has decided to try a little sleight of hand.
The fast food giant's Dollar Menu will now be called the "Dollar Menu and More." As in, not everything on the menu will cost a dollar. Some items will be $2. Some even $5.
The new menu rolls out Nov. 4 with ads starting Nov. 11, according to Advertising Age.
Who knows? It might work. The idea, of course, is to invoke potential cost savings with the phrase "Dollar Menu," plus the truth-in-advertising disclaimer "and more." It has worked in some dollar stores, where consumers are often hard pressed to find anything besides small bags of balloons for a buck.
Don Thompson has tried a variety of measures to boost sales. Top management has been changed, new menu items have been added, and now the menu content (and pricing) is being played with.
All this comes as the company warned Monday that sales at restaurants open more than a year would be flat in October and that the woes would continue in the fourth quarter. A combination of stiff competition and slow economic growth are to blame, according to McDonald’s.
Not everyone agrees with the company’s assessment. Hedgeye Risk Management restaurant analyst Howard Penney told Reuters that the company’s high-profile beverage expansion hid the fact that core items like hamburgers and french fries were not selling.
Worldwide sales at McDonald's restaurants open at least 13 months gained just 0.9 percent in the third quarter. These numbers fell short of analysts' estimates.
McDonald’s new “Dollar Menu and More” will replace the "Extra Value Menu," an attempt, perhaps, to communicate savings to consumers more clearly.
Fast food rival Wendy's (WEN) performed its own low price menu surgery in January, renaming its "99 Cent Menu" to "Right Price Right Size Menu." As with McDonald’s, the name change allowed Wendy’s to boost the price of some items and still tout the notion of value to customers.
McDonald's latest new food promotion features Mighty Wings -- just in time for football season. CEO Thompson, on the earnings call, said the item has not exactly been a raging success.
According to Thompson, "One dollar per wing was still not considered to be the most competitive in the current environment."
At the time of this writing, Jim Probasco had no position in any mentioned securities.
Read more from Benzinga
".99 Cent Menu"?
"Found in the back of the freezer crap we have to cook now Menu"?
"Healthy!?....here's your Healthy Menu"?
Awwwww, damn it.......
The Obama Strategy, mislead the customer with promises and then screw 'em!
You like that old hamburger? you can keep it!
You like ketch up on that old hamburger? you can still have it!
Get the same burger you like for less!
Save time and money and order on line!
I think that the McDonald' s Corporation should be glad to see that they are actually seeing a profit still. The are some of us who have not had a wage increase since 2007 - or have had wage cuts. I do not think they should be messing with the Dollar Menu - There are some people who save all month just to have enough to treat their family to a night out at McDonalds. That does not say much for our society that a trip to McDonalds is a treat - and cause for celebration when "taking the family out to eat".
McDonalds - Please do not make any changes at this time to the Dollar Menu - instead cut the top 10% executives wages by 5% and see if that doesn't keep the numbers up there for the Share Holders.
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Do it once a year. This allows the best-performing asset classes to take off and run.
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