By Jamie Barrie $ 1 value menus are once again back in the spotlight, with Taco Bell learning from the mistakes made by McDonald’s and turning that into a gain for Taco Bell’s. Taco Bell, debuted in December with the $1 Double Stacked Taco and its Feast for $1 All Day campaign in October, the fast-food chain is putting its $1 menu items front and center as the restaurant industry faces slumping sales. In a recent interview Taco Bell’s chief marketing officer, Marisa Thalberg said, “We have not walked away from the dollar-menu price point when others have.” Thalberg was making reference to when McDonald’s replaced its iconic Dollar Menu with the Dollar Menu and More, as it became more difficult to sell items for just $1 and still turn a profit. It was a switch that caused problems for the chain. In 2015, CEO Steve Easterbrook said McDonald’s had not replaced the menu “with significant- enough value in the eyes of consumers.”
for $4” promotion, and the Taco Bell $5 Cravings deal. These deals all drove sales in the fast-food industry in 2016 by offering customers perceived value without the thin or nonexistent profit margins that made McDonald’s franchisees hate the Dollar Menu. Now with a restaurant recession looming as cost- conscious customers increasingly eat at home and seek deals on food when they do eat out, they are looking to get more meal for the $1 and Taco Bell is looking to capitalize on this where others have failed. While McDonald’s was forced to sell classic Dollar Menu items at just $1 despite rising food costs and inflation, much of Taco Bell’s $1menu is made up of new and limited- time items. Taco Bell’s willingness to chase bizarre trends, which allows the chain to use $1 menu items as a way to get customers in the door will be a win for the chain. At the same time, Taco Bell will not just rely on $1 menu items to attract bargain shoppers and get them through the doors and drive troughs as Thalberg states that the $5 Craving Deals and other bundled deals will also play a valuable part in the chain’s marketing game plan in 2017.
While McDonald’s and other fast-food chains have turned to bundled deals such as the McPick 2, the Wendy’s “four
16
SPOTLIGHT ON BUSINESS MAGAZINE • FEBRUARY 2017
Made with FlippingBook HTML5