Hoping to capitalize on a perceived weakness at McDonald's, No. 2 Burger King has unleashed a string of ads that directly target the leader and turn up the heat on an already intense market battle.
Burger King Corp.'s latest TV campaign, from Ammirati Puris Lintas, New York, pits its Double Supreme cheeseburger against McDonald Corp.'s Big Mac. One 30-second spot touts the Double Supreme's 75% more beef and asks if Big Mac lovers are "ready for a new relationship?"
Another spot focuses on a teen who describes how Burger King's product is bigger and tastes better than the Big Mac. The camera then pulls back to show that the teen is a McDonald's crew person.
Both spots promote Burger King's $2.99 value meal.
The two burger giants have been fighting fiercely of late. An Inauguration Day print ad and TV spot last month urged President Clinton to abandon the Big Mac in favor of the Whopper. McDonald's responded with a letter in USA Today Jan. 24 thanking the president for his devotion to McDonald's.
BURGER KING EMBOLDENED
Analysts and other industry insiders say Burger King has been emboldened by its own strong sales in 1996, as well as McDonald's domestic sales difficulties.
"Burger King is a little cocky right now. They're looking to capitalize on McDonald's perceived vulnerability," said one analyst.
Jeff Bonasia, director of brand communications at Burger King, denied that attitude exists: "McDonald's current state of business has zero to do with our current marketing and our marketing in the future."
"All three major brands share consumers, and we're always looking for the opportunity to steal consumers from our competitors," said Matt Heller, senior VP-group director at Ammirati.
Although Burger King hopes to enjoy a short-term sales bump from Double Supreme, Mr. Heller said the Whopper will remain the focus of the chain's $300 million 1997 ad budget.
Of the top three chains, both Burger King and Wendy's International increased same-store sales last year, mostly at the expense of McDonald's. Burger King grew an estimated 2.6%, while Wendy's grew approximately 7.5%.
While acknowledging that domestic sales were down in '96, McDonald's did not quantify the loss.
McDonald's holds an estimated 40% share of the about $50 billion fast-food burger-chain market, compared with Burger King's 17% and 15% for Wendy's.
Burger King has run comparative ads in the past. A 1995 Ammirati campaign compared Burger King's hamburgers with those of both McDonald's and Wendy's. Also, Burger King's first introduction of the Double Supreme cheeseburger in January 1996 featured a supposed McDonald's employee eating the burger.
BK PRICE PROMOTION
Although Burger King has "been hammering food attributes" in its marketing, its current success is still largely attributable to aggressive price promotion, specifically the 99¢ Whopper, said Paul Westra, analyst with Salomon Bros.
"At this stage, McDonald's is playing defense--trying to slow [Burger King's] momentum," he said.
McDonald's in recent weeks has returned to a discounting strategy.
No. 3-ranked Wendy's also has stepped up discounting, promoting 99 cent chicken nuggets and 99 cent Double-Stack cheeseburgers in some markets.
The long-term impact of the burger segment's price wars is detrimental, Mr. Westra said.
"The underlying business has suffered greatly on the pricing and margin sides," he said. "The name of the game isn't yardage, it's points. Sure, they're stealing sales from each other, but can they make a profit?"
As the top three hammer at each other, the near-term winners might be smaller, regional burger chains such as Sonic Drive-Ins, Jack in the Box and Carl's Jr.
Using quirky ads and differentiated product offerings, each has positioned itself as "an answer to the sameness and bigness and blandness of the other three brands," said John Weiss, analyst for Montgomery Securities.
Copyright February 1997, Crain Communications Inc.