QSR value menus drive traffic, increase regular menu sales

Three major quick-service restaurant (QSR) chains—Jack in the Box, McDonald’s, and Taco Bell—are looking to drive traffic in a flat market by introducing value menus. According to a recent study by The NPD Group, a global information company, these value menus are working. Value menu traffic for all QSRs increased by 10% and consumer spend increased by 13% in the first quarter of 2018.

The value wars among the three major chains began in late 2017 when McDonald’s announced that it would launch a new value menu in January 2018. For McDonald’s, the primary business objective was to bring back customers that the chain lost over the past few years when it moved away from value via the Value Menu. Other QSR chains, like Taco Bell and Jack in the Box, introduced a value offering of their own to compete with McDonald’s and retain their respective customer bases.

In addition to driving traffic and winning back or retaining customers, the idea of value menus is that a customer will likely purchase a regular-priced item with the value item. While results for each of the three chains varied, on average for all three chains, 72% of consumers purchasing from the value menu also purchased from the regular menu, finds the NPD report.

“A value proposition is definitely warranted to increase customer visits and drive frequency in today’s marketplace as the recent crop of value menus bear out,” said Bonnie Riggs, NPD restaurant industry analyst. “But it’s important to fully understand the impact and effectiveness of these promotions, whether it’s understanding value-seeking customer behavior or loyalty erosion.”

Press release