McDonald's Co. (Japan) Ltd. unveiled a new menu Thursday that cut prices for many of its core products.
Under the new price system, which begins April 19, a double cheeseburger combo will sell for 500 yen, down from 577 yen.
The price change is part of the hamburger chain's new growth strategy announced by Chief Executive Officer Eiko Harada the same day.
During a news conference, Harada, who also serves as chairman and president, stressed that the price reductions should not be characterized as a price-cutting effort designed to give sales a temporary shot in the arm.
"This is not a discount," he said. The changes will be made to "make (stores') menu boards more simple and easy for customers to make their choices."
Yet the move, which aims to streamline price lines, will mean five combo sets will be discounted to a uniform 500 yen. A cheeseburger that now sells for 126 yen, and hot coffee, which costs 189 yen, will both be priced at 100 yen in the new menu.
The 3,800-outlet chain posted its first profit in three years in 2004. The firm had been suffering weak sales as it struggled to lure back customers who were unimpressed with cheap hamburgers.
"We have clearly turned ourselves around," former McDonald's Japan Chairman Pat Donahue told the news conference. Donahue stepped down as chairman after a shareholders' meeting Wednesday.
Harada, who joined McDonald's Japan last year, said the chain's successful turnaround was made possible by going back to basics.
"There were so many season-limited items. We also failed to reach the heart of customers by sending lots of marketing messages," he said when asked the reasons for the company's poor performance before he came on the scene. "We need a consistent brand strategy."