MIAMI Burger King will try cutting the price of its double cheeseburger to $1 in an attempt to trump one of McDonald’s most popular bargains, Dow Jones Newswires reported Tuesday.
The story said the chain intends to lower the price of the burger in three test markets to what McDonald’s charges for its double cheeseburger, a key component of the archrival’s Dollar Menu. BK’s version is reportedly larger than the sandwich offered by McDonald’s.
Dow Jones said the plan was revealed in a memo sent to BK employees and franchisees by Russ Klein, who is the president of global marketing, strategy and innovation for franchisor Burger King Corp.
“It is our belief that the dollar double cheeseburger is the most powerful weapon our competitor has to continue their growth and steal disproportionate share from the category,” Dow Jones quotes Klein as commenting about the double cheeseburger on McDonald’s Dollar Menu.
In New York City and apparently other markets, Burger King’s double cheeseburger currently is priced at about $2. Dow Jones said that stores in Los Angeles have been selling their double cheeseburgers for 99 cents for several weeks.
“The fact remains that we are still at a double-digit disadvantage to McDonald’s and Wendy’s in Best Value for the Money ratings,” Klein was said to have written. Dow Jones quotes him as saying that McDonald’s Dollar Menu generates $450,000 in sales per unit, compared with the $140,000 that typically comes from BK’s value menu.
The move by BK comes as some McDonald’s franchisees have complained about selling a double burger for $1 at a time of rising commodity prices. Some units have bumped up the price of their double cheeseburgers by as much as 99 cents, with the Value Menu revamped as a Value Menu & More listing.
Dow Jones noted in its story that BK’s three-city test of a bigger $1 double cheeseburger could ignite a price-cutting war between the quick-service giants. Oak Brook, Ill.-based McDonald’s operates or franchises more than 30,000 restaurants worldwide, and Miami-based BK operates or franchises more than 11,000.