If there’s anything to learn about unforeseen mistakes and the dangers of assuming the obvious, A&W’s third pounder marketing story is a classic example.
Both McDonald’s and A&W have dominated the fast food category for years. Each with their varied signature approaches in the burger market. However, it has been stated repeatedly that it is impossible to dash McDonald’s as a fast-food powerhouse worldwide. A&W efforts to compete with McDonald’s were met with untimely failure in their third pounder campaign.
McDonald’s, for close to 60 years, has been identified as the grandfather of fast food restaurant having served billions of hamburgers. Its popularity is perhaps due to the Big Mac. McDonald’s boomed in the burger market with the quarter pounder in 1972, dominating sales. The quarter pounder is mainly beef on a bun made up of processed cheese, some cut white onions, ketchup and mustard. A&W, on the other hand, is known as the home of the burger family and provides straightforward burger menus including variations in toppings and sizes. In the 1980s, A&W released the Third Pounder attempting to compete with McDonald’s quarter pounder. Despite putting up a very lavish marketing campaign, A&W’s third pounder burger was just not selling.
A&W strategy depicted an assumption on their part when they decided to introduce the third pound burger while capitalizing on the popularity of McDonald’s quarter pounder. Competition against the quarter pounder was easy. Simply adding more beef, hence the one-third pound of meat patty. Focus was on consumers’ preference for fresh beef and A&W’s third pounder would be an obvious choice as opposed to frozen meat offered in other fast food chains. A&W went ahead to offer the third pounder at the same price as McDonald’s quarter pounder. Arguably, this would bargain a no-brainer decision when getting a burger. More so, the third pounder was becoming popular choice in blind taste tests.
A&W took the third pounder to the market with a very extravagant campaign assuming they had nailed it all. But the burger did not sell as presumed and was a complete failure. Set out to understand why the burger did not gain popularity in the market, A&W did more investigation. Market research revealed the bottom-line being price as well as the perceived sense of value. About more than half of Yankelovich focus group’s participants probed the price of the burger. “Why,” they asked, “should we pay the same amount for a third-pound of meat as we do for a quarter pound of meat at McDonald’s? You’re overcharging us.’’ The reason why A&W third pounder did not sell despite offering more beef was because the average American did not understand fractions. The third pounder was thought to be relatively less than the quarter pounder since the number three is less than the number four.
A&W’s misfortune with the third pounder burger had in it some important lessons for the future of marketing. It is critical that one is clear in their message and marketing. You can never assume your audience resonates in a particular way with the information relayed. The consumer’s intelligence – or lack of it thereof – cannot be taken for granted. The only thing A&W did wrong was assuming the obvious…
Speaking of marketing campaigns of fast food burger chains, you might be interested in checking out Burger King’s unique marketing campaign.