McDonald's is making a strategic shift towards chicken-based menu items, in response to rising beef prices and changing consumer preferences. The company's CEO, Chris Kempczinski, noted that beef has been one of the most impacted areas by cost inflation, encompassing both food and packaging, as well as labor costs. This move is also influenced by the global chicken market being roughly twice the size of beef and growing at a faster rate, providing significant opportunity for McDonald's to expand its market share beyond its current 40% in beef.
The fast-food giant has been steadily expanding its chicken offerings for years, with this year seeing a particular emphasis on value menu items centered around chicken. Examples include the introduction of a $5 McChicken as part of its lower-priced McValue menu, the reintroduction of the Chicken Bacon Onion sandwich in Italy, and the success of the Chicken Big Mac in Germany. McDonald's is also launching new and resurrected chicken products like wings, tenders, and nuggets, accompanied by new sauces to boost customer interest.
This poultry push comes as consumers are tightening their budgets, making chicken a more affordable option compared to beef. While beef and veal prices surged by 8.6% in March year-over-year, chicken costs rose by only 1.3%. This affordability, coupled with consumer demand for more chicken – with US chicken consumption projected to exceed 100 pounds per person in 2024 – makes it a key driver for quick-service restaurants. McDonald's has gained nearly two points of market share in the chicken category over the last few years, indicating the success of its strategy in a competitive market against chicken-focused chains like Chick-fil-A and Popeyes.
Other fast-food chains are also leaning into chicken. Chipotle's limited-time honey chicken offering helped prop up sales, and Taco Bell is considering adding a crispy chicken option permanently after its limited-run nuggets sold out quickly. This industry-wide trend highlights chicken as a crucial element in maintaining value leadership and attracting budget-conscious diners amidst a broader battle for customers. McDonald's plans to continue prioritizing chicken, with expectations of more chicken options appearing on menus soon, including the potential reintroduction of its chicken Snack Wrap.
