The fast food giant McDonald’s has been storming the market ever since its conception. However, as the fast food markets entry barriers decrease and competition within the market rises, will it be possible for this chain to stay competitively priced?
When I was young, McDonald’s enticed my family for two reasons: Happy Meal toys and cheap food. However it was these points of difference that kept me loyal to the chain, this is no longer the case as Wendy’s, Burger Kings, Subways, and restaurants alike have already jumped on the child friendly bandwagon. And as for the cheap food, that statistic is true only if you buy solely off the Value Picks menu, as a regular meal can run you anywhere up to $10.
So why choose McDonald’s over another restaurant? Well that question is becoming harder to answer. Personally, I would rather invest my $10 in a restaurant that’s a little more “high end” than the traditional fast food burger joint. Though, the $1.56 including tax specials will keep consumers buying for a while.
The point? Product differentiation draws customers. Although McDonald’s did this well when I was young, the company now needs to find something to set itself apart from the Wendy’s, Burger Kings, and Subways of the world or risk losing its customer base altogether.
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