This is not the first time McDonald’s has been taunted by Burger King, particularly during its well-known Monopoly game promotion which is always a major event as consumers hunt for the rare game pieces. By lowering the cost of chicken nuggets so drastically, Burger King is taking a shot at taking away some of the steam of that annual event.
The Burger King franchise is certainly taking the King part of its name seriously. In addition to taunting McDonald’s, the company has been busy initiating other tactics which have caused stock prices to soar while the competitor’s plummet. Stock prices for Burger King have increased a reported 56 percent thus far in the past year.
Some of the King’s tactics have included acquiring the Canadian coffee chain Tim Hortons, and as a result, creating a parent company for both located in Canada, which saves on corporate taxes. Simplifying the menu and slashing executive perks have also made the chain more appealing to both investors and customers. Also appealing to investors is the price of stock. With McDonald’s stock down from $102 to $96, Burger King’s $38 per share price tag is eye-catching, particularly since the company is on an upswing, while McDonald’s is on a decline.
With profits on the rise and the company staying true to its classic fast food roots, customers can have it their way with low prices and the food they have come to love. The dividends for Burger King are obvious, both literally and figuratively. Although there is still a gap between their stock prices, Burger King’s direct assault on McDonald’s iconic menu item may help close it.
There are still several months left in the financial quarter, and this is the time of year when fast food chains tend to up their game in marketing and promotions. What Burger King will do next is anyone’s guess, but if this latest strategy is any indication, consumers are sure to be reaping the benefits, while the Golden Arches may lose a bit of their luster.
(Photo courtesy of Mike Mozart)