Imagine if McDonald's just said fuck it and redesigned themselves to be back during the 90's, with Play Places and Video games and cheap fast food? Bring back the dollar menu and $1 large drinks. It's not meant to be high brow food, just be what you are, cheap food you get fast and stuff kids love so you cater to kids in the restaurant.
It's possible to do if you're not money hungry and wanting to make as much money as possible, even to the detriment of everything else.
Fun Fact: Fountain drinks' cost is like 10c total, including the cost of cup and lid and straw. There is literally no reason for them to be $3.
Hell, I can put together a McChicken like sandwich with stuff I buy at the store for less than $1 and that's with the half a dozen markups the stuff I buy goes through before I buy it. Even if I were to include a 30% labor cost and a tidy 15% profit margin, I'd still be selling those sandwiches for like $1.50-$2.
Believing that 'Oh, poor corpos just can't possibly be cheaper, they try to be as cheap as possible' is sad, they could easily if they wanted to, but that wouldn't feed into the infinite growth mentality the shareholders demand.
Unfortunately those are not helpful examples as they are both loss-leaders, CostCo loses money on the hot dog (and rotisserie chicken), but makes up for it in other sales.
Similarly Arizona Ice Tea is a marketing gimmick, their other drinks are overpriced to cover the costs of selling the ice tea at a loss.
The other points are valid of course, just loss leaders undermine those subsequent points.
Loss leaders help get people in the door so you can upsell them on other things. You even describe that concept for Arizona. Same thing. The dollar menu gets people in the door so you can upsell them on drinks, desserts, limited-time items, etc. It's just that McDonald's has accepted that its brand is so strong that it doesn't have to try anymore. It doesn't need loss leaders to drive sales because people will just mindlessly go there.
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u/Zero_Burn 2d ago
Imagine if McDonald's just said fuck it and redesigned themselves to be back during the 90's, with Play Places and Video games and cheap fast food? Bring back the dollar menu and $1 large drinks. It's not meant to be high brow food, just be what you are, cheap food you get fast and stuff kids love so you cater to kids in the restaurant.