Burger Flop: The Arch Deluxe

How Faulty Assumptions Led McDonald’s to One of the Most Spectacular Product Fails of All Time

The year was 1996. In an attempt to broaden its appeal to a mature demographic with a more sophisticated palate, McDonald’s decided to introduce a hamburger marketed specifically towards adults called The Arch Deluxe. Why? Well, demographic trends showed that people were living longer and getting older — which presumably meant that they wanted fancier hamburgers, which, in turn, meant that if McDonald’s were to offer such an item on its menu, these same people would go to the fast food chain to buy their fancy hamburgers. As it turned out, this assumption was wrong. $300 million dollars wrong.

So, where exactly did McDonald’s and its team of product and marketing experts go astray? After all, the company’s extensive market research did in fact show that people generally responded favorably to the idea of eating a more “grown-up” hamburger.

What only later became apparent to the fast-food giant is that people who wanted deluxe hamburgers and a fine dining experience did not go to McDonald’s for it ( at least not at the time). People come to McDonald’s because it is convenient, inexpensive, family-friendly, and, above all, consistent — whether you visit a McDonald’s in India or Indiana, you pretty much know what you’re in for. The idea that McDonald’s brand-positioning would change or expand by introducing a higher-end line of sandwiches proved to be flawed. In reality, the hamburger’s high price was not a hit with consumers and its jarring advertisements didn’t help. In August of 2000, after an estimated $300 million dollars spent on research, production, and marketing efforts, McDonald’s discontinued the Arch Deluxe.

Interestingly enough, McDonald’s forays into fancier fast-food items did not end there. In May of 2017, the company launched a new line of artisanal sandwiches, called Signature Crafted Recipes, once again hoping to capture a corner of the fast-casual burger market. In April 2019, McDonald’s announced that, based on customer feedback, it would begin phasing out its Signature Crafted Recipes line in favor of focusing on its simpler, more classic favorites.