As inflation and skyrocketing prices continue to batter consumers, McDonald’s is returning to its roots in affordability. To that end, the iconic Americana burger chain is promoting a $5 Meal Deal in hopes of reengaging their customer base.
The limited-time deal went live on June 25, 2024 at participating locations and is available through the end of summer.
Limited-Time $5 Meal Deal
The $5 meal deal includes:
- A McDouble burger or McChicken sandwich
- Small fries, 4-piece chicken nuggets
- A small drink
In addition to the $5 Meal Deal, the franchise has also started “Free Fries Friday” for app orders.
Additionally, the McDonald’s is offering free medium fries daily with a minimum purchase of $1 throughout 2024.
“Affordable prices and creating memorable moments are what McDonalds is all about,” said John Palmaccio, McDonald’s owner and operator.
McDonald’s is not the first U.S. corporation to offer low-cost full meals.
Wendy’s released their $5 Biggie Bag in March 2019 which looks a lot like the McDonalds promotion. The Biggie Bag features an option of a burger or chicken sandwich, chicken nuggets, fries and a drink.
In June 2024, Wendy’s offered a free small Frosty with any Biggie Bag to mark five years of the deal.
Weary Consumers
The $5 Meal Deal comes after McDonald’s CEO Chris Kempczinski said in a February 2024 earnings call that the company was facing competition in the “battleground” demographic of low-income consumers, who opted to cook at home rather than eat out due to rising prices in the fast food industry.
Reddit users weren’t surprised at the news.
“The battleground? They’re literally pricing out those consumers. I’m middle class and I don’t go to McDonalds anymore with how expensive it is” shares Reddit user Justryan95.
“You shouldn’t need an app to afford food,” says user disastrous-fun2325.
McDonalds president Joe Erlinger wrote in a letter to consumers that the average price of a Big Mac is only up 27%, a 10-piece nugget is up 28%, and a medium french fry has increased 44% since 2019, contrary to “viral social posts and poorly sourced reports that McDonald’s has raised prices significantly beyond inflationary rates.”
“While we’ve been working hard to make sure our fans have great reasons to visit us, it’s clear that we — together with our franchisees — must remain laser-focused on value and affordability,” Erlinger said.
Attempts to Reattract Customers
In addition to the $5 Meal Deal, McDonalds is experimenting with other app promotions every month. Promotions include a 6-piece chicken nugget BOGO deal, a free Big Mac with any $1 purchase, and a $0.99 iced coffee through the end of July 2024. Consumers can also earn points on the app with every purchase to unlock more free food.
Restaurants may continue to struggle as more consumers opt to eat at home. According to the latest data from the USDA’s Economic Research Service, prices to eat out rose by 4%. Meanwhile, grocery costs rose by 1% compared to May 2023.
With the $5 Meal Deal’s upcoming sunset, McDonald’s may have to do more to appeal to cash-strapped consumers.
Related: Americans Hold More Than $1.1 Trillion In Credit Card Debt
“We certainly know consumers are more weary or weary of pricing, and we’re going to continue to be consumer led in our pricing decisions as we kind of look forward to 2024 and knowing that the environment will continue to be competitive,” says Kempczinski.
Early Signs of $5 Meal Deal Look Promising
Placer.ai, a data analytics company that anonymizes and consolidates consumer data collected from apps on behalf of the companies collecting them, noted that the Tuesday after the $5 Meal Deal launch was McDonald’s busiest of the year.
It was topped on July 2nd, suggesting the meal had gained even more traction.
<script src="https://embedded-widget.placer.ai/ew.js" async></script><iframe src="https://embedded-widget.placer.ai/widgets/v1/editorial/?type=infogram&id=_%2FLjSEpz6yTcj9OtI6S1bl&tag=blog_%7BVisits+To+McDonald%27s+Jump+Following+%245+Meal+Deal+Launch%7D" loading="lazy" allowfullscreen="true" allow="clipboard-write" referrerpolicy="origin" scrolling="no" style="border: 1px solid rgb(229, 229, 229); border-radius: 8px; width:100%;height:600px;"></iframe>McDonald’s clocked an 8% uptick in customer foot traffic those Tuesdays when benchmarked against the year-to-date Tuesday average.
However, whether McDonald’s can sustainably offer $5 meal deals profitably remains to be seen.
An increase in foot traffic does not always translate positively on the bottom line. It’s a lesson seafood chain Red Lobster found out the hard way.
In 2023, the Red Lobster offered a door-busting $20 all-you-can-eat shrimp deal. The offer backfired, drawing in hordes of customers who out ate expectations, ultimately costing the seafood-chain $11 million in losses.
Red Lobster filed for Chapter 11 bankruptcy earlier this year.
