Bruce Sterling on 4 Feb 2001 21:56:14 -0000

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<nettime> FW: McDonald's New 'Surplus Value Menu' Pays You To Eat

(((Bruces remarks:  Let me once again assert that I do NOT, in fact, write
these futurefeedforward things. Yes, they are hilarious, and yes, I am
also hilarious, but I am not quite that kind of hilarious. I am merely
forwarding them to the nettime list so that the author's genius may be
properly appreciated by the Virtual Intelligentsia.  By the way, I just
got a cool futurefeedforward *T-shirt.* Wow!

(((In other nettime-related news, I'm going to be in Berlin for a week,
starting tomorrow.  Viva Transmediale! == bruces )))

To: <>
Subject: McDonald's New 'Surplus Value Menu' Pays You To Eat
Date: Sun, Feb 4, 2001, 10:05 AM

July 13, 2067

McDonald's New 'Surplus Value Menu' Pays You To Eat

OAK BROOK, IL--In yet another example of the through-the-looking-glass
pricing schemes that have become popular among consumer products
bellwethers over the past 18 months, McDonald's announced today that it
will begin paying its customers to eat select combinations of its menu
items.  Starting August 1, customers ordering from the new "Surplus Value
Menu" will also receive cash payments ranging from $.15 to $1.45.  The
flagship of the new menu, the "Big Mac Surplus Value Meal," including a
Big Mac Classic sandwich, french fries, and a branded soft drink, costs
the customer nothing, and comes, instead, with a cash payment of $.99.

 "A number of related insights lead to the development of the 'Surplus
Value' strategy," explains McDonald's Marketing VP Friedrich Shank.  "The
first is that we live in an attention economy, and in an attention economy
you pay for eyeballs, or, in our case, stomachs.  The second, and more
important, is that consumers with more money buy more.  Ford kept wages
high so that his workers could afford to be his customers.  We're taking
that one step further and paying our customers so that they can afford to
be our customers.  A huge percentage of our potential worldwide market
continues to live at the subsistence level and can't afford our products.
This new strategy will bring them into the McDonald's fold."

 Fielding questions from concerned investors, Shirley Wheere, McDonald's
IR Chief, noted that "McDonald's is adopting this new strategy from a
position of market strength.  We continue to dominate the quick-service
and education channels.  The 'Surplus' strategy aims at top-line growth,
from which we expect notable bottom-line follow-through."

 "Sure, I'm concerned," opines independent industry analyst Orna
Kincklenum.  "Whenever you see something like this it gives you pause.
Dramatic loss leader pricing is a desperate measure.  You don't amputate
the limb unless it's about to fall off anyway."

 Economic and business theorists characterize strategies like the "Surplus
Value Menu" as attempts to "extract internal value from negative
enterprise externalities."  Harvard economist J. Yis Prudome explains:  
"The classic example would be the relationship between a polluter and a
company that supplies clean-up equipment and services.  If, by polluting,
I make business for the clean-up guys, I can partner with them, both to
tailor my pollution in order to make their clean-up more efficient, and,
more importantly, to get payment in exchange for agreeing to continue
polluting and making more clean-up business.  To understand how a company
like McDonald's can afford to do something like this, you just have to ask
yourself who, outside the firm, benefits when people eat more Big Macs?
That's who's paying you to eat them."

 Others tie the McDonald's announcement to its recent retention of
FeedBank, the financial services and consulting subsidiary of temporal
networking giant Futurefeedforward.  "If you look at the SEC filings of
all of the companies who've announced something like this in the past
year," points out Plum Difference, director of investor and consumer
advocacy group FIGHT, "you'll see that all of them partnered with or hired
FeedBank in the months preceding the change in business strategy: BP,
International Paper, MT&T, all of them.  FeedBank pushes the idea that the
time value of money is about to reverse, that future dollars are worth
more than present dollars.  What's happening is that FeedBank is helping
the big guys pawn-off their present dollars on an unsuspecting public."

 The Surplus Value Menu will be available, beginning August 1, and for the
foreseeable future, at participating McDonald's franchises worldwide.


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