McDonald’s Just Made a Big Announcement, and Taught a Smart Lesson in Emotional Intelligence

Imagine somebody pitches an idea.

They have a product that costs them about $4.75, and they plan to sell it for $5.

That’s a 25-cent profit. How excited would you get about making a bright shiny quarter on every sale?

Only you can answer that, but it’s essentially the math behind the $5 Meal Deal at McDonald’s, according to an industry analyst. 

That’s why the fact that McDonald’s just announced that it’s extending the limited-time offer once again is intriguing, and why smart business leaders will recognize that there’s probably something else going on besides the numbers.

That something? It has to do with emotional intelligence.

Quick recap: McDonald’s introduced the $5 Meal Deal back in June in order to help take on two related challenges.

The first was inflation. As CEO Chris Kempczinski said earlier this year, customers were simply becoming “more discriminating with every dollar that they spend.”

Second, McDonald’s seemed caught in an emotional perception feedback loop.

As an example, remember the story about the $18 Big Mac combo meal at a McDonald’s on a highway rest area in Connecticut? 

McDonald’s says that was an unusual exception — and it was. But people aren’t big on nuance when it comes to viral photos and stories like that. 

So McDonald’s had to do something. It didn’t just need a promotion. It needed a statement.

Hence, the $5 Meal Deal, rolled out as a four-week limited-time offer to begin with: a McDouble hamburger or McChicken sandwich, small fries, four-piece Chicken McNuggets, and a small soft drink.

Then, McDonald’s announced it was continuing the $5 Meal Deal through the rest of the summer. Most recently, they announced they’re extending it through the fall.

Worth noting: McDonald’s restaurants are owned by independent franchisees, and yet according to reports, 93 percent voted to continue the $5 Meal Deal the first time, and 80 percent or more voted to keep going again.

McDonald’s hasn’t revealed the exact effects of this promotion, although in a message to restaurant franchisees and others this summer, the chain said the offer enticed customers to return — and just as important, took them away from competitors’ restaurants.

Here’s the official statement from Joe Erlinger, president of McDonald’s USA:

“This summer, tens of millions of fans went to their local McDonald’s to enjoy our $5 Meal Deal, and it was so great to welcome them. 

“Together with our franchisees, we’re committed to keeping our prices as affordable as possible, which is why we’re doubling down with even more ways to save. Whether you’re stopping by for breakfast, lunch, dinner or a late-night snack, we want everyone to find the food they love at a price that hits the spot. 

“The extension of the $5 Meal Deal, and the other offerings we’re announcing for our fall line-up, are just a few of the ways we’re working hard to offer great meals at a fair price.”

McDonald’s is clearly sweetening the deal for franchisees. And, besides bringing more people in the door, the idea is that hopefully some who come for the $5 Meal Deal wind up buying other things, too.

But most important is the idea that this whole promotion might succeed in changing people’s emotional association with McDonald’s.

I’ve written a lot about how McDonald’s uses emotion and nostalgia in its marketing. They work hard to associate the very idea of McDonald’s with something about much more than just food.

Instead, it’s about childhood, and memories, and feelings. (Recent obvious example: the Collector’s Meal.)

Still, it’s a heck of a challenge if people lose the underlying emotional link: the very idea that if you buy lunch or dinner at McDonald’s, you’re getting a “deal.”

Look, I know emotional intelligence can be hard to measure.

But in business, it just comes down to leveraging emotions — both yours and other people’s — to make it more likely you’ll achieve your goals.

McDonald’s seems to have found a way to do just that. Otherwise, would they keep the promotion going?

Resetting people’s expectations, drowning out the memories of the inflation of the last few years: If it’s working, I wouldn’t stop either.

What would it be worth to your business if you could find a way to rekindle the perfect emotional connection you want your most important customers to feel for you?

I’ll bet a lot more than a quarter.