McDonald's Value Deals Win Back Cost-Wary Diners
Quick-service operators should watch how targeted discounts affect traffic and franchisee margins as customers cut back on dining out.
Updated on Nov. 5, 2026 in Inflation
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Have you cut back on eating out at fast food restaurants this year?
McDonald's is leaning harder on lower-priced meals and promotions as U.S. customers pull back on dining out, and its U.S. sales have begun to improve. The push affects franchised restaurants nationwide, since about one-third of franchisees did not take part in its under-$3 menu.
Why it matters
Customers have cut back on dining out as living costs rise, so the chain is using targeted deals to win back diners who have turned to cheaper competitors, convenience stores or meals at home. The move follows the June rollout of its 'NEXT' turnaround strategy, and it puts pressure on franchisee margins because the discounts are not uniform across the system.
Promotions include a $2 breakfast sandwich, free fries with a $1 minimum purchase, and an under-$3 menu that roughly two-thirds of franchisees joined. Restaurant traffic rose with the return of the Monopoly promotion and Halloween-themed Boo Buckets but stayed below year-ago levels.
The players
McDonald's
A global quick-service restaurant chain built largely on franchised locations, whose U.S. operating model depends on franchisee participation in company-led promotions.
White & Case
A global law firm that McDonald's has retained to defend it against a lawsuit alleging its AI-powered pricing tools are used to fix prices.
eToro
A multi-asset online trading platform whose analyst Nagham Hassan commented on the likely pace of the restaurant chain's recovery.
The details
McDonald's has not cut prices across its entire menu. Instead it runs extra-value meals and time-limited offers, and it uses machine-learning algorithms to calculate an 'optimal price' for each menu item at each restaurant. The approach lets the chain target price-sensitive diners without a system-wide discount, though that same granularity is at the center of a lawsuit alleging AI-powered tools are used to fix prices, which McDonald's has hired White & Case to defend.
Timeline
June: McDonald's announced its 'NEXT' turnaround strategy.
September and October: Baseline traffic trends were encouraging, according to the CEO.
End of 2027: Target for expanding its Archie AI drive-thru ordering assistant to most U.S. restaurants.
Market Landscape
McDonald's is pairing value promotions with its Archie AI drive-thru ordering assistant, which it aims to expand to most U.S. restaurants by the end of 2027. The strategy extends the company's use of automation across both ordering and pricing as it competes with cheaper alternatives for diners cutting back on eating out.
Operators in food service and adjacent restaurant categories should watch how value offers affect franchisee margins and traffic. Operators should weigh whether discounting at the price-sensitive end of the market is sustainable against the costs it adds to their own operating lines.
The takeaway
The core lesson is that targeted value deals, rather than a full menu cut, are how a large chain is trying to win back cost-conscious diners. Operators should track whether their own traffic recovers and whether franchisee participation holds, since uneven adoption can blunt the effect.
Further reading
For more on how rising living costs are reshaping spending, see Inflation coverage across the United States.
Live Poll
Have you cut back on eating out at fast food restaurants this year?
