Scenario: Extra Value Meal Bundle Pricing atMcDonalds McDonalds Extra Value Meal bundle pricing strategy hasbeen one of
Question:
Scenario: Extra Value Meal Bundle Pricing atMcDonald’s
McDonald’s Extra Value Meal bundle pricing strategy hasbeen one of the most successful pricing strategies everdevised.
The prices McDonald’s charges vary by type of sandwich. Popular sandwiches, or ones with more costly ingredients, maybe priced higher.
For example
Big Mac EVM: $5.99
Quarter Pounder w/ Cheese EVM: $5.99
Egg McMuffin EVM: $3.99.
Prices may also be higher at a McDonald’s restaurant located inairports, highway rest stops, or prime downtown locations in majorcities. Furthermore, prices may vary according to whether therestaurant is owned by McDonald’s or a franchise or has competitiveor promotional considerations.
“Extra Value Meals” Bundle Pricing
The Big Mac Extra Value Meal
Item | Unbundled Price | Bundled Price |
Big Mac | $3.92 | N/A |
Medium Fries | $1.79 | |
Medium Soft Drink | $1.00 | |
Total | $6.71 | $5.99 |
Bundle price saves | $0.72 |
The Quarter Pounder W/ Cheese Extra ValueMeal
Item | Unbundled Price | Bundled Price |
Quarter Pounder w/ Cheese | $3.45 | N/A |
Medium Fries | $1.79 | |
Medium Soft Drink | $1.00 | |
Total | $6.24 | $5.99 |
Bundle price saves | $0.25 |
The Egg Mcmuffin Extra Value Meal
Item | Unbundled Price | Bundled Price |
Egg McMuffin | $2.69 | N/A |
Hash Browns | $1.00 | |
Medium Soft Drink | $1.00 | |
Total | $4.69 | $3.99 |
Bundle price saves | $0.70 |
Analysis
Fill in Why Mcdonald’s Uses Bundle Pricing.
Suggest the benefits of bundle pricing to customersand the company as well as the effects on other fast-foodrestaurant competitors
Why Mcdonald’s Uses Bundle Pricing
Factor | Reasons for using bundle pricing |
Customer | |
Company | |
Competition |
Reflection Questions
Why do you think McDonald’s would use a bundle pricing strategy based on the three factors outlined in the handout?
In your own words, why do you think McDonald's does not just sell the items separately and charge the higher prices?
Thinking about fast food competition, which do you think costs more to make: a taco or a burger?
Submission
Upload a document with your completed table of WhyMcdonald’s Uses Bundle Pricing and the answers to the 3 ReflectionQuestions
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Microeconomics An Intuitive Approach with Calculus
ISBN: 978-0538453257
1st edition
Authors: Thomas Nechyba
