Where Burger King Has a Whopper Problem

A Whopper may be smaller than we think:

According to a lawsuit against Burger King, the Whopper in its ads is 35% larger than the real one with double the amount of meat.

Fast Food Ads

Whoppers

In a Florida courtroom, 19 people from 11 states claimed their Whopper purchases were based on “false and misleading advertising concerning the size and/or the amount of ingredients.” Responding, Burger King said, “The flame-grilled beef patties portrayed in our advertising are the same patties used in the millions of burgers we serve to guests across the US.” Although Burger King also said that individual preparation did indeed result in burgers that looked different, the judge agreed to hear the case.

Cheeseburgers, Big Macs, and Crunchwraps

Meanwhile, Wendy’s, McDonald’s, and Taco Bell faced similar challenges. However, diverging from Florida, a New York federal judge dismissed charges against Wendy’s and McDonald’s. Referring to Wendy’s Bourbon Bacon Cheeseburger and the McDonald’s Big Mac, the NY judge said that rather than being deceived, consumers knew that ads always were visually appealing. As for Taco Bell, its problems related to the amount of beans in items that included its Mexican Crunchwrap. My image is from court documents that (sadly) misspelled receive:

Our Bottom Line: Fast Food Competition

Concerned with competition, Burger King wants to be sure its Whopper is more appealing than McDonald’s Big Mac and Wendy’s Double Stack. At the same time Taco Bell makes its wraps appear more enticing. Indeed, telling us what is special about their food, each chain differentiates its menu from everyone else’s.

In a monopolistically competitive market, it all makes sense.

Monopolistic competition is composed of two halves. The monopoly part indicates the company is producing something unique that you associate solely with it. But the competition half says that lots of others have something that could be identical or very similar. A beauty salon is the perfect example. You can get a haircut at many hundreds of shops. But the one person who does your hair is what makes the place unique.

Because we can say the same thing for burgers and burritos, you can see why the chains care about you, me, and the competition. Each is trying to distinguish its identity from all the others.

Below, I’ve drawn a market scale showing the most (left) to the least (right) competition. On the left side we have the price takers, small firms, and easy market entry. On the right, we find the opposite:

You can see why Burger King might have a wonderful Whopper in its ads.

My sources and more: Thanks to Slate Money for inspiring today’s post. From there, I went to Business Insider, the NY Times, and CNN for case summaries. Then, these legal sites, here and here, had the facts. Meanwhile, econlife looked at similar fast food cases and also slack-fill in chips bags.

Please note that several of today’s sentences were in past econlife posts.