Not Lovin McDonalds - ©

Rising Menu Prices: Watershed Moment For Fast Food?

I came across an interesting post yesterday, that reveals prevailing customer feelings about rising menu prices. And if the folks who commented to the post are representative of the masses, this could well be a watershed moment for Fast Food…

Burgers re-mastered - © 2023 - McDonaldsMaybe more pertinent than McD’s realized at the time they ran this promo earlier
this year. If only they had headlined and institutionalized the policy…

It’s a popular let-your-steam-off Reddit site cleverly (?) titled ‘toRANTo’. The topic of the day was rising Fast Food prices. And the prevailing attitude was, “Why even eat here anymore?”

Sounds innocuous enough – until you start to read the comments.

A passive-aggressive revolt?

It all started with a plaintiff question:

“A Big Mac Meal is $13.10. Why even eat here anymore. It’s no longer a poor man’s food. If I can get a proper meal that’s filling elsewhere with that amount of money why even go there anymore? Why do you still go to McDo?”

The answer was, a lot of people don’t anymore. Or are considering kicking their Fast Food habit.

“Yeah it’s crazy how expensive fast food has become. The delta between fast food and lower tier sit down restaurants in terms of price is so small now. Almost no point in eating fast food now.”

“There’s is also nothing ‘fast’ about it anymore either.”

“Yeah, this is why I barely ever go to fast food places anymore, unless I’m out and about and just need something quick. ”

“Haven’t been there for 4 years.”

“Forcing me to use the app to get the cheap iced coffee or cone was the final straw for me. Those were 90 percent of the reason I went there (hashbrowns – now $2 each – was the other).”

“Yeah, my last visit I ordered a large coffee and two hashbrowns and it was seven dollars. I’m never going back.”

“I think they’ve rested on their laurels far too long. I can’t remember the last time I had an actual hot burger, sure the fries/chicken products are usually fresh but the burgers have become very sad.”

“Budget sub from subway is $13. A burrito from most places is $15-20. Who can afford to eat out anymore? This is ridiculous.”

“$5 or $6 subs was not that long ago.”

Some not so harsh

But some more charitable folks were not so harsh:

“Convenience. Yes, there’s a lot of cheaper food out there but they are not on every street corner like McDonalds is.”

“[I still go] Just for the coffee, which is better than Tim’s and still a reasonable price. Other than that, nada.”

“There is still that unique taste of a McDonalds meal I guess. Sometimes just have a desire for a Big Mac and fries, don’t fully understand why.”

“Also they have been consistent with the taste of their food for as long as I can remember.”

Still 5 to 1 against

But the comments to to the initial post still ran more than 5 to 1 against Fast Food. Why this wave of discontent among folks who have been eating Fast Food all their lives?

Price hikes topped the list of former-customer complaints. And some commenters sounded as though they felt betrayed by the Fast Food industry:

“It feels like a double big Mac today is what a normal big Mac was like before.”

“The quality is dog shit now too. I hope they go broke.”

“McDonald’s is [a] total rip-off now.”

“The evil bastards clear your [rewards program] points after a while. I never knew that. You can’t get more evil than that.”

“…And don’t forget the ‘suggested’ tip screen. Call me an asshole but I’m sorry if all you did is clerk my food at subway while I stood in line for 15 minutes… That’s not the same thing as me going into an actual restaurant with a server.”

“Wow. Big Companies really do play the long game, don’t they. They target kids from an early age, and let marketing and time do [their] thing.”

Chains caught in a bind

I almost feel sorry for the big Fast Food chains. They’re caught in a serious bind brought on by the current and pending economy.

They’ve got general inflation to deal with plus the soaring cost of food. And they really don’t have any choice but to pass on increases to their customers. Even if that turns the customers resentful and, in some cases, even hostile.

The darker point that many commenters to the Reddit post made was, Fast Food menu prices are now neck-and-neck with those at ‘nicer’ restaurants which serve better food.

Minimum Wage hikes a challenge

I was shocked, while researching a post not long ago, to see that the official menu price for a medium McDonald’s Fries was (C)$3.99 in Canada. But only (US)$1.79 in the US.

But that may, in large part, reflect the recent increase in the minimum wage. The federally mandated minimum wage in Canada rose to $16.65 an hour last spring. That’s more than twice what it was a decade ago. And foodservice industry workers were one of the main groups pressing for ‘a living wage’.’

I remember when McDonald’s praised itself as the single largest employer in the world to give kids their first real work experience. They said they were helping instill a good work ethic that kids would carry with them the rest of their lives. As such, McD’s was helping make every succeeding generation better citizens, workers and taxpayers.

Back then, a McDonald’s job was never meant to be a career. Younger folks who worked behind the counter were there to make some pocket money. In the case of the older folks, to help stretch their increasingly inadequate pensions. Now Millennials, Xs andf Zs are demanding a ‘living wage’. That’s a disconnect the chains have yet to resolve.

The chains fight back

As we’ve reported may times in this space, the Fast Food chains used the COVID Era to test a number of new business models. Not the least of those was the one they’re phasing-in now. In a nutshell, it involves smaller restos on smaller pieces of real estate, significant staff cuts, a greater reliance on automated prep and service systems, and an emphasis on delivery and takeout.

That last point goes hand-in-hand with plans to devote more of their real estate footprint to vehicle traffic and eliminating dine-in space.

Still, it doesn’t appear that Fast Food menu prices will fall much, if at all, when the new cost-saving, streamlining measures are fully implemented.

My take

It’s clear that even the formerly most-devoted Fast Food fans are in revolt against the big chains. And the main trigger is soaring menu prices.

The chains have come up with that they feel are clever plans to counter many of the cost-increase issues they face. But keeping menu prices down has not been one of them.

Some chains tried streamlining their menus – getting back to their core identities, they called it – to keep down the amount and variety of food they had to keep on hand. But the relentless pressure of competition has rendered that effort mute. Most Fast Food joints’ menus are once again just as long and complex as they were pre-COVID.

A stark example… McDonald’s made its name originally on doing a few things best: Fries, simple burgers and shakes. Imagine the savings they could realize – and the menu price cuts they could offer – if they returned even part way back to their origins.

As I see it, the chains have to move away from competing with the other players in the crowded space on menu variety and novelty. What they need to do is focus on competing based on menu prices. Otherwise, their core customers will soon abandon them. In fact, according to the toRANTo post, it’s already happening.

~ Maggie J.