McDonald's Considers $5 Value Meal To Combat Traffic Woes

It's no secret that inflation fatigue has been coming for the drive-thru lane. Now, McDonald's is aiming to attract the customers it drove away during its revenue-tunnel-vision-haze of the past few years — and the chain might be dropping a $5 value meal soon. The proposed bundle would include bundles focused around a McChicken or McDouble entree, with a four-piece McNugget, fries, and a drink. Right now, these plans are in the discussion phase as the company seeks the approval of franchisees. The idea is anticipated to move into the production phase. According to Restaurant Business, McDonald's franchisees expect the deal to pass with a vote this week. The deal's exact length has not been specified, but the idea is currently under discussion as a limited-time-only promotion.

This value bundle might be modeled after Wendy's $5 Biggie Bag, which similarly offers a choice of sandwich plus four-piece nuggets, fries, and a drink. Although, Mickey D's is far from the only fast food chain employing a strategy of pushing value-centric concepts. Taco Bell has been championing consumer perception affordability, launching its new Cravings Value menu earlier this year with 10 items priced at $3 or less. That may be about all that folks are comfortable spending these days thanks to inflation.

This move from McDonald's as an industry leader could signal shifting tides for the infamous fast food price spike that's taken form over the past few years. As Mark Kalinowski, president of Kalinowski Equity Research, recently told CBS MoneyWatch, "When you look at McDonald's, they're not getting a majority of high-income customers — the middle- and lower-income class are the bulk of their business." During a recent call with investors, McDonald's President and CEO Chris Kempczinski noted that fans' discretionary spending budgets have been stretched thin for some time now, regardless of tax bracket. Quoth Kempczinski: "It may be more pronounced with lower-income consumers, but it's important to recognize that all income cohorts are seeking value," via the WDBJ7 news outlet.

As of last November, fast food prices industry-wide were up 29% in four years. Last July, a Connecticut McDonald's faced major backlash for charging $18 for a Big Mac combo meal and $16.59 for a Filet-O-Fish, and it soured many fans' appetites. McDonald's subsequently reported stagnant or declining foot traffic during fiscal Q1 2024 across the U.S. market. In February, the fast food burger giant failed to hit projected quarterly sales for the first time in nearly four years. Now, it looks like the chain is listening to its audience, and it's working. Following the announcement of the $5 value bundle on Friday, McDonald's shares rose by 2.7% — the highest jump since January 2023.