New Burger King logo
Source: BusinessWire
Burger King is testing a loyalty program in five US markets as part of a broader effort to expand the digital experience for customers.
The Restaurant Brands International chain is the latest restaurant chain to look at rewards programs as a way to boost sales. Loyalty programs from names like Starbucks and Chipotle Mexican Grill help those businesses expand their base of loyal customers and encourage more frequent visits. The introduction of the Burger King’s Royal Perks test follows an announcement by arch-rival McDonald’s on Wednesday that it is entering the next phase of its own loyalty program tests.
“It’s something we’ve been working on for a while that we’ve had in different versions of beta testing,” said Ellie Doty, Burger King’s Chief Marketing Officer, North America. “It’s the natural next step if you want to have digital leadership and find ways to create more personalized experiences for your guests.”
Jose Cil, CEO of Restaurant Brands, said at a Morgan Stanley investor conference in December that Royal Perks will help Burger King move away from a promotion-driven approach to offering deals and low prices for customers.
Burger King customers in Los Angeles, Miami, New York City, New Jersey, and Long Island can earn reward points for every dollar they spend. Members can also earn points for orders from the Burger King website or app. According to Doty, the program is currently mainly tested in the digital channels of the hamburger chain.
One of the benefits of the program is the ability to exchange points for most menu items. In comparison, the McDonald’s test limits redemption options to 16 menu items.
Burger King’s loyalty program also offers free daily benefits, such as increasing members’ drinks or fries, and awards double points during the member’s birthday month.
The chain plans to bring the program to more markets throughout the year. However, Doty said Burger King is not yet committed to a nationwide launch in 2021, and the current format is not set in stone.
“We’re going to take our time to get things right, so we’re going through a pretty rigorous scale-up, so we’re learning along the way and getting it right before it gets national,” she said.
Shares of parent company Restaurant Brands are down 6% in the last 12 months, putting it at a market value of $ 27.6 billion. Tim Hortons, Burger King’s sister chain, has taken longer to get back from the coronavirus pandemic as more consumers brew their own coffee at home. Restaurant Brands is expected to announce its fourth quarter results before the bell on Thursday.