The McRib’s Many Economic Conspiracy Theories – Morning Brew

As of Wednesday, the in/famous McRib is back at McDonald’s for its first nationwide rollout since 2012. Whether or not you’re a fan of the McNugget’s porcine cousin (same chef, same process), you might be wondering, “Why now?” 

While there’s no direct link between McRib rollouts and the Mayan calendar, there are a few popular conspiracy theories detailed by Willy Staley in The Awl purporting to explain why the McRib occasionally rises from the fast food ashes…but never for long.

Theory #1: Porky arbitrage

Does McDonald’s time McRib releases to the pork price cycle for a bigger profit per sandwich? From 2005–12, dips in hog prices have matched up with McRib launches. 

But it’s unclear whether McDonald’s is taking advantage of low pork prices, or causing them. See those price spikes in the summer leading up to each release? They seemingly coincide with the announcement of the McRib, meaning the announcement itself could artificially inflate hog futures.

Another snag: Is McDonald’s really that agile? One franchise operator told Freakonomics that McRib launches are planned at least a year out. 

Theory #2: Loss leadership

A “loss leader” is a product that costs businesses more to make than customers pay for it. Companies choose to take an L on these items in the hopes that they will lure customers to buy profitable products that recoup the loss. Think of cheap printers that require expensive ink. 

• By that logic, the McRib could be nothing more than a barbecue-bathed marketing tactic to get customers through the golden arches. Once inside, McDonald’s makes money from the drinks, sides, and other items customers buy to round out their Michelin-star meal.

+ This theory could tie back to the first one: If the McRib is indeed a loss leader, McDonald’s would have more reason to take advantage of low pork prices. 

Theory #3: Diminishing marginal utility

This is the Occam’s razor of the bunch: the McRib just isn’t popular enough to be a full-time member of the menu. According to the same franchise operator quoted above, McRib rollouts follow a repeating pattern: “First few weeks we sell nearly 200 per day and near the end we may sell less than 50 per day.” The menu item makes money in limited runs, but becomes less valuable long-term. 

So, put another way…

The McRib’s a Supreme hoodie, the McNugget’s a North Face fleece

Some history: In 1981, McDonald’s was struggling to churn out enough McNuggets. It had overloaded the chicken supply chain, so the same chef who created those pulverized poultry patties made a similar product out of pork parts. Eventually, the chicken supply caught up to McDonald’s demand, while the McRib’s popularity waned. 

If McRibs were as popular as McNuggets, it’s feasible they’d also become a forever menu item and the pork industry would play catch-up like chicken had. Ergo, McRibs probably just aren’t as popular. 

Bottom line: Any combination of these theories could be true. But the mythos matters more than the truth, because all of these guesstimations contribute to the McRib’s biggest value-driver: hype.

*** This article has been archived for your research. The original version from Google News can be found here ***