The cost of living crisis has led to an increase in the number of fast food options

The giants of the fast-food industry are competing with each other in an increasingly competitive race to offer you the best deals.

Whether it’s cheap breakfasts at McDonald’s or Greggs, or lunch deals from KFC and Domino’s, promotions are becoming increasingly popular.

So why this sudden outpouring of special offers?

Simply put, customers are more frugal and chains want to keep customers coming back, although critics worry about the health impact of this wide range of fast food options.

The number of promotions offered at fast-food restaurants, bakeries and cafés between April and June this year increased by a third compared to the same period last year.

This follows from data from Meaningful Vision, a company monitoring this sector.

“The use of promotions is becoming an increasingly key tool for generating additional traffic that has not been there before,” says CEO Maria Vanifatova.

He added that the number of visitors had been falling throughout the year until May, and that only now has there been an increase of 1% compared to last year.

Fast-food chains, like other businesses, have raised prices dramatically due to the cost of living crisis.

But prices at fast-food restaurants have risen on average slightly more than those at grocery chains, notes Siobhan Gehin, a retail expert at consultancy Roland Berger who was previously a director at KFC.

“This unprecedented speed of change has not given businesses and consumers time to get used to the new price levels,” he says.

As Ms Gehin adds, this means that customers either choose cheaper dishes from the menu or eat at home.

As a result, fast-food companies are “using the leverage of promotion to stimulate demand.”

Let’s not forget that companies need to think about financial results.

In the second quarter of this year, McDonald’s saw its first decline in sales since the pandemic, forcing the company to “comprehensive rethinking” of pricing.

“It used to be quite profitable, but now it’s seen as quite expensive,” says independent retail expert Clare Bailey, whose first job was at McDonald’s.

He claims that you can get a meal in a pub for only slightly more than a meal in a fast-food restaurant.

But there are reasons the sector has had to raise prices, he says.

High energy costs, packaging costs, increases in the minimum wage for workers and, in the case of McDonald’s, a commitment to source its beef from local suppliers all played their roles.

Alistair Macrow, CEO of McDonald’s UK and Ireland, says people are facing difficult decisions about where and when they spend their money and value is “more important than ever”.

He claims that the company takes customer feedback into account when choosing offers.

“Our 3 for £3 offer first ran at the end of the month when our customers told us they needed help the most, and also during the school holidays, which allowed more families to get together for a meal out.

“We heard it was working, so we brought it back to coincide with the school holidays.”

He added that McDonald’s launched a breakfast offer in the spring – putting it in direct competition with Greggs – because “customers told us they needed to prioritise quality at breakfast”.

This contract has also been reinstated for a limited time.

Maria Vanifatova says lunches have become especially competitive.

For example, in March KFC launched a £5.49 lunch deal which included a fried chicken wrap, a side and a drink.

A month later, Domino’s announced the launch of a £4 Cheeky Little Pizza at lunchtime, with Pizza Hut and TGI Friday’s recently joining the ranks.

While these chains claim they are trying to give their customers value for money, Katherine Jenner, director of the Obesity Health Alliance, is cynical and worries about the impact of this approach on health.

“Multi-pack offers aren’t about saving customers money. Companies aren’t doing it to be nice to them,” he says.

“It’s a marketing tactic designed to get people to buy things they wouldn’t otherwise buy.”

Ms. Jenner says that portions at fast food restaurants are much larger than those you can make at home. There is also more sugar, salt and fat, she says.

“You can’t even make informed decisions about what you’re buying because the information isn’t readily available.”

So how long can we expect this avalanche of promotions to last?

“Once consumers start expecting discounts, vouchers and so on, it will be hard to break away from that because many shoppers will start to rely on it,” Ms Bailey says.

“Maybe they would never have gone there at full price.”

Siobhan Gehin, however, is not so sure.

“I would expect discounting to continue at least through the end of this year, but to gradually ease as consumer sentiment improves and interest rates decline.”

But there is one trend that looks set to stick around for a while: offering deals via apps.

McDonald’s Mondays and Burger King’s Whopper Wednesdays are examples of app-based promotions. KFC and Subway also offer new deals every few weeks for app customers.

“More and more companies are turning to their regular customers and offering them deals to keep them loyal,” says Maria Vanifatova of Meaningful Vision.

They hope that their loyal customers will do the same in return.