Shake Shack Rolls Out French Onion Flavor Menu As Value Battle Intensifies: Report

Shake Shack (SHAK) is reportedly aiming to be part of the restaurant industry's value wars by offering premium items at a discount through the launch of a new menu innovation on Tuesday, featuring French onion flavors.

According to a CNBC report, Shake Shack will introduce its French Onion Menu, featuring a new French Onion Soup Burger. The French Onion Soup Burger will be first made available on its app on September 9 and then across all channels on September 12, the report added.

Retail sentiment on Shake Shack improved to 'bullish' territory from 'neutral' a day ago, with message volumes at 'high' levels, according to data from Stocktwits. Shares of Shake Shack were down 1% in early trading on Tuesday.

Competition among fast-food companies in the United States has intensified as they strive to attract customers, primarily from lower-income and middle-income cohorts, who seek affordable deals and meals. In recent months, McDonald's, Domino's, and Yum Brands have all ramped up their value offerings to compete.

The new menu innovation comes on the heels of Shake Shack's recent launch of $10 Dubai Chocolate Pistachio Shake. 

The CNBC report added that, like the Dubai shake, the French Onion Soup burger is priced at a premium of $10.99 compared with the other menu offerings of the company. It cited CEO Rob Lynch to say that the Dubai shake was the highest-priced shake in Shake Shack's history and was sold out nearly everywhere.“We are really bringing great value to the marketplace by delivering burgers that you're going to have to pay $25 for in a local burger shop, and we're selling them for $10 or $11,” Lynch told CNBC.

The report added that Shake Shack was mapping out 18 months of menu ideas. Lynch told CNBC that the premium limited-time offerings will allow diners to“self-select” higher-priced food instead of the company trying to increase prices of its core product offerings.

Shares of Shake Shack have declined by over 26% this year and by 1% in the last 12 months.

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