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McDonald’s Wants to Promote Value by Implementing $5 Meal Deal

McDonald’s

McDonald’s is reportedly encouraging franchisees to vote to implement a $5 meal deal to bring back consumers who have left because of high prices.

Franchisees — which can weigh in on major marketing campaigns — rejected the fast-food giant’s proposal earlier this year, but the issue has come up again, Bloomberg reported Friday (May 10).

McDonald’s CEO Chris Kempczinski said during the company’s latest earnings call that the company had to focus on affordability and that the firm currently doesn’t have a “national value platform,” according to the report.

However, when the initiative was put before franchisees earlier this year, some were concerned that they would lose money on the four-week promotion, especially in states like California, which recently increased its minimum wage for fast-food workers, per the report.

Reuters, which also reported Friday on the proposed $5 meal deal, said global restaurant chains have seen more of their low-income customers choosing to save money by eating at home and that McDonald’s has been impacted by this trend more than some others.

Companies across industries have noted the impact of inflation and pinched consumer wallets. During McDonald’s May 1 earnings call, Kempczinski said: “Consumers continue to be even more discriminating with every dollar that they spend as they faced elevated prices in their day-to-day spending.”

Fast-food traffic in the United States fell 3.5% during the first three months of the year compared to the same period in 2023.

While the pace of food inflation in restaurants has slowed over the past year, prices are still much higher than they used to be. Fast-food prices in March were 33% higher than 2019 levels.

The reports of the proposed $5 meal deal come a day after it was reported that McDonald’s is set to modernize its marketing strategy by launching a digital marketing fund to be paid into by its U.S. franchisees.

With this move, the company aims to modernize its marketing approach, enhance its competitive advantage and strengthen its position in the digital business landscape.