McDonald's plans to step up deals, marketing to combat slower fast food traffic
McDonald’s plans to step up deals and value messaging to combat slowing sales
McDonald’s plans to step up deals and value messaging to combat slowing sales.
The Chicago burger giant said inflation-weary customers are eating out less often in many big markets. In the first quarter, fast food traffic was flat or down in the U.S., Australia, Canada, Japan, the United Kingdom and Germany.
“The consumer is certainly being very discriminating in how they spend their dollar,” McDonald's President and CEO Chris Kempczinski said Tuesday during a conference call with investors. “It may be more pronounced with lower-income consumers, but its important to recognize that all income cohorts are seeking value.”
McDonald's said its same-store sales – or sales at stores open at least a year — rose 1.9% worldwide in the January-March period. That was below Wall Street’s forecast of a 2.1% increase, according to analysts polled by FactSet.
McDonald's had warned investors that the exceptional growth it was seeing post-pandemic would likely slow this year. With grocery prices lower, many consumers are eating more meals at home. Still, the same-store sales increases the company posted in the first quarter were lower than the 3% to 4% McDonald's usually sees in a typical year.
In the U.S., same-store sales rose 2.5% in the first quarter, but that was largely due to price hikes carried over from last year.
Kempczinski checked his McDonald's app during the call and noted that there were multiple deals available in his area, including one Big Mac for 29 cents when you buy another. And Kempczinski said 90% of U.S. restaurants are offering meal bundles for $4 or less.
But Kempczinski said McDonald's needs a nationwide value message and marketing
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