The Real Reason Behind the Fast-Food Promotion Boom

• Fast-food chains are increasing promotions to attract budget-conscious customers amid rising prices and declining foot traffic.
• Critics worry that these deals, often promoted through apps, may lead to unhealthy eating habits despite offering short-term savings.

Fast-food restaurants are competing to provide the most affordable deals, including breakfasts for a low price at McDonald’s and Greggs and lunch specials at KFC or Dominos. Why is there a sudden rise in deals?

Customers Are Budget-Conscious

The public is becoming more cautious about their spending, and fast-food restaurants seek to entice them to return. But there’s a concern regarding the effects on health from these frequent fast-food offers.

Promotions Are Skyrocketing

The data taken from Meaningful Vision, which tracks the market which tracks the sector, has revealed that promotions in fast-food establishments, bakeries and coffee shops increased three times throughout June and April this year compared to the same period the previous year. Maria Vanifatova, the CEO of Meaningful Vision, says that promotions have been a crucial approach to improving customer flow and have steadily increased.

Declining Foot Traffic

The number of people who walk through the doors was lower over the last year, but recent reports have shown a modest 1 per cent increase. The slow growth has prompted companies that sell fast food to review pricing strategies, particularly following a decline in sales.

Price Increases Hit Hard

The cost of living crisis has seen fast food prices increase more quickly than groceries. Retail expert Siobhan Ghin says that the speedy price fluctuations have left companies and customers trying to find a way to change. People are choosing more affordable menu items or preferring to dine at home, forcing fast food restaurants to depend on sales to boost the demand.

Balancing the Bottom Line

Fast food chains must think about their profit margins. McDonald’s saw its first decline since the pandemic during the second quarter of the year, prompting a significant rethink of the pricing policy. Clare Bailey, an independent retailer, says it is possible to have a sit-down dinner in pubs for the exact cost as a fast food bargain. Bailey explains that prices for energy, costs associated with packaging, increased minimum wages, and commitments to local-sourced sourcing contribute to prices increasing.

Offering Value to Customers

Alistair Macrow, CEO of McDonald’s UK and Ireland, recognizes value is more crucial than ever. McDonald’s has introduced a variety of deals that aim to provide value at periods when consumers need it most, like the closing of each month or during the holidays.

Lunchtime Wars

Lunch deals are becoming increasingly popular. KFC launched a PS5.49 lunch offer in March. This was then Domino’s PS4 Cheeky Little Pizza deal in April. Pizza Hut and TGI Fridays have joined in the race by offering lunch deals of their own.

Health Concerns

Many need to be sure that they are only intended to help customers. Katherine Jenner, director of the Obesity Health Alliance, asserts that multi-buy promotions are marketing strategies designed to boost sales, usually resulting in larger portions and higher salt, sugar and fat intake.

The Future of Promotions

What will the duration of this increase in sales be around for? Clare Bailey believes that once people get used to the discounts or vouchers, they’ll find it challenging to get them back. In contrast, Siobhan Ghentin predicts that discounts will persist throughout the year. However, it may slowly ease if consumer attitudes and interest rates improve.

Deals via Apps

One trend that is likely to stay is offering deals via apps. McDonald’s Mondays, Burger King’s Whopper Wednesdays, and regular promotions from KFC and Subway are some examples of app-based offers. Maria Vanifatova from Meaningful Vision says that more businesses target their customers with special offers via apps intending to retain the loyalty of their customers.

Conclusion

The increase in fast food deals responds to a shift in the economic environment and customer behavior. However, the promotions offer instant value for customers, but these have concerns in terms of long-term health benefits and sustainability of such offers will be awaited.