One side is right, one isn’t. Only, you’re not quite sure which is which. West Side Story was compelling because we could see both sides’ prejudices. The jets. The sharks. Both wrong. Both right. Just neither at the same time. There’s a three-way burger rumble shaping up between McDonald’s, Carl’s Jr. and Hardee’s. Just like West Side Story, there are generous servings of right and wrong to go around.
The turf: Angus. Carl’s Jr. and Hardee’s say McDonald’s crossed the line. McDonald’s, claims they’re just following their value proposition into Angus burgers.
Fight on your opponent’s terms and it’s an even bet you’ll lose. McDonald’s is doing what they do and they’re doing it big. Carl’s Jr. and Hardee’s, meanwhile, are being who they are–clever and snarky. All three are stepping out–though, only one of them has the guns to pull it off.
Since McDonald’s rolled out their Angus burgers, sales at the Golden Arches are up 2.6% in July, according to The Wall Street Journal. Carl’s Jr. and Hardee’s, both owned by CKE, report sales are off 3.65% in the four weeks ending August 10th. Up is good. Down is bad. But, is this sales differential a matter of Angus?
McDonald’s Big Angus burger is $3.99. You’ll pay $3.49-3.99 at Hardee’s and Carl’s for their 1/3 pound of Angus. CKE sees, in this moment of price parity, a chance to take a bite out of McDonald’s value provider perception. There’s a problem: McDonald’s owns “value” in the minds of customers like hot owns ouch. Looks like CKE is coming to this gun fight with a butter knife.
Hardee’s and Carl’s Jr. aren’t content to just fight it out for Angus. They’re taking direct aim at McDonald’s signature product, offering a cash rebate: Try a Big Mac. If you like it better than the new “Big Carl,” CKE will pay you. Compare the Big Mac? Good luck with that. Better still, ask Pepsi about taste challenges. Ronald’s packing the heat of emotional connection; we all have car loads of family memories under his Golden Arches.
Challenging a competitor’s long-held perceptual ground by inviting your customers sample them is more foolish than gutsy. Chances are, you’ll only further entrench the competitor’s position and weaken your own. Worse still, it’s nya-nya thumb-sucking; unless you send the other guy home in a bag, you’ll sound petty and small. Ronald continues standing tall.
McDonald’s banner billows atop value mountain. CKE, meanwhile, is equally secure atop big burger mountain–it’s really more of a hill. So, what’s CKE doing? Coming off their hill to wage an up-hill attack on McD’s mountain.
CKE probably isn’t fighting to win, but instead Marketing Outrageously to “draft” McDonald’s; gaining sales as a result of marketing lift from their bodacious attack. More likely, the draft benefit will ultimately go to McDonald’s by virtue of girth. As a result, what CKE is really tagging is niche turf.
West Side Story’s turf battle ends with one hero laying dead on the playground, others standing in humbled silence. Both sides loose. This Angus rumble won’t wind up in a mortal climax, but it will leave two of the three players bloodied for no lasting gain. I’m betting Ronald won’t be one of them. He’s got a rocket in his pocket.
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