No One Manipulates Prices Better Than The Fast-Food Industry

LOS ANGELES , May 9, 2013 () – No one is better at price manipulation than the fast-food industry. That’s not an insult. That’s a compliment at the highest level.

I recently saw an example of this manipulation at my local Jack in the Box. I saw a poster on their window offering two Jumbo Jack burgers with cheese for $4. It sounded great to me, so I went there a few days later. But here’s what I noticed when placing my order at the drive thru:

Ordering one Jumbo Jack burger with cheese cost $1.79.

So let’s do some quick basic math:

The promotion Jack in the Box was offering cost me $4.37 when you factor in tax.

But if I just paid the standard price for the same food, it would’ve cost me $3.91 with tax.

So I’ve just spent 46 cents more for the same food.

What a promotion!

And I mean that sincerely. This is brilliant, brilliant marketing by Jack in the Box. I don’t go there all that much because there’s not a location that’s very convenient for me near my home. But that promotion led me to drive a little more and spend more money than I would’ve spent without the promotion.

And at the expense of insulting my fellow consumers: Most customers aren’t going to take the time to figure this out. Most of them won’t even think about it. They’ll see the poster and immediately assume it’s a great deal.

Del Taco is doing the same thing with its new Buck and Under menu, featuring a number of items ranging from 50 cents to $1. Looks good, sounds cheap, but guess what? A lot of the items on this menu were recently priced lower than they are now. So people are going to spend more and think they’re paying less.

Price manipulation?

I like to think of it more as good marketing.

Nevin Barich is the Food & Beverage Analyst for IndustryIntel. He just spent extra money on a Jack in the Box promotion…and may very well do it again. He can be reached at

* All content is copyrighted by Industry Intelligence, or the original respective author or source. You may not recirculate, redistrubte or publish the analysis and presentation included in the service without Industry Intelligence's prior written consent. Please review our terms of use.