McDonald's is making a bold move to win back cost-conscious diners with a significant price cut on popular combo meals.
According to Fox Business, in a strategic push to rebuild its reputation for affordability, McDonald's and its U.S. franchisees have agreed to lower the cost of eight key combo meals by 15% compared to buying items separately, while rolling out special promotions and value-driven initiatives to drive traffic.
This journey began in January 2024, when McDonald's introduced its "McValue" menu category as a core part of its comeback strategy. The menu featured a "Buy One, Add One for $1" deal across breakfast, lunch, and dinner. Simultaneously, app-specific offers like free medium fries with a $1 purchase every Friday in 2025 and a free McCrispy chicken sandwich for new users were launched.
Local franchisees also stepped up, offering their deals such as discounts on the McGriddle and app-exclusive perks like 20% off purchases of $10 or more. These efforts show a decentralized push to cater to budget-minded customers.
Fast forward to May 2024, when McDonald's U.S. President Joe Erlinger publicly tackled rumors of excessive price hikes. He expressed frustration over reports of $18 Big Mac meals at isolated locations.
"This is inaccurate," Erlinger stated, addressing claims that prices had soared far beyond inflationary trends.
"I can tell you that it frustrates and worries me, and many of our franchisees, when I hear about an $18 Big Mac meal being sold – even if it was at one location in the U.S. out of more than 13,700," he added.
"I’m more concerned when people believe that this is the rule and not the exception," Erlinger continued, blaming poorly sourced reports for distorting the narrative around pricing. Indeed, the numbers tell a different story. The average price of a Big Mac in the U.S. was $4.39 in 2019, rising to $5.29 last year—a 21% increase largely tied to inflation.
Following weeks of discussions, McDonald's and its U.S. franchisees finalized the 15% price reduction on combo meals to reinforce affordability. This isn’t just a gesture—it’s a calculated move to counter perceptions of overpricing. The company also pledged financial support to franchisees adopting the change.
Later in 2024, McDonald's will introduce heavily promoted "Extra Value Meals," including a $5 breakfast and an $8 Big Mac and McNugget combo. These specials aim to draw in diners feeling the pinch of economic uncertainty.
With most of its global restaurants operated by independent franchisees, McDonald's relies on their buy-in for such initiatives. The company declined to provide further comment on the pricing strategy.
For investors, McDonald's stock (MCD) offers a snapshot of market sentiment, last reported at $313.00 with a +0.72% uptick. This modest gain suggests stability amid these consumer-focused moves.
From a wealth-building perspective, McDonald's pivot to value could be a signal for long-term investors. If these price cuts drive traffic and rebuild brand loyalty, there’s potential for steady growth in a volatile economy. Consider monitoring foot traffic data or same-store sales in the upcoming quarters.
Ultimately, McDonald's is betting on frugality to resonate with its base—an approach that aligns with free-market principles of meeting consumer demand. In a world of inflationary pressures and questionable monetary policies, such efficiency-driven strategies are a reminder: value wins. For diners and investors alike, the message is clear—focus on fundamentals, whether it’s a budget meal or a diversified portfolio.