The fast food sector is a highly competitive one in Israel, though yesterday's sale will result in a duopoly, that is, a market dominated by two major players - in this case the global giant McDonald's, and the Paz-Zadik controlled Burger Ranch.
The sector has suffered a sharp downturn in the past two years due to a double whammy - the recession which has affected all levels of economic activity, among them eating out, and secondly the intifada, with its knock-on effect of deterring the public from visiting busy commercial centers and malls. For all these reasons, the pressure was on to keep prices down, and some players were sure to suffer.
The recession and rising unemployment also impacted on the spending power of fast food's natural consumers - children and youth, who often use the restaurants as meeting places as much as eating places. The three major players concentrated their marketing campaigns at this population group.
According to a TGI survey conducted by Teleseker among youths aged 12-17 last year, those that ranked Burger Ranch as their preferred fast food chain were predominantly youths from traditionally religious and observant backgrounds. Those that preferred rival Burger King were mostly youths whose parents had 12 years of education (to high-school), and from average-income families. McDonald's, according to the survey, attracted more youths aged 12-13, secular, above-average income families and whose parents had more than 13 years of education.
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