Have It Your Way? Burger King Phases Out Paper Coupons

Paper coupons have been a real headache for Burger King – in more ways than one. So now the burger chain’s owner thinks it can do better without them.

Fast food restaurants have done big business during the coronavirus pandemic, as customers barred from dining inside their favorite restaurants hit the neighborhood drive-thru instead. But that growth is beginning to lag at Burger King. So owner Restaurant Brands International says it’s eyeing a more digital future to help attract the next generation of customers.

Sales declined this past quarter “driven primarily by, one, the underperformance of value offerings, and two, our intentional shift away from paper coupons,” CEO Jose Cil told investors this week. Paper coupons’ “effectiveness has eroded a bit over time, especially with the younger consumers,” he said. So “we made a conscious decision to reduce our investment in this declining promotional channel.”

As fast food coupons go, Burger King coupons have been among the most prevalent. Historically, Cil said Burger King has offered around three times as many paper coupons as its competitors. But the company began rethinking that approach earlier this year. “The issue, I think, is our promotional approach,” Cil said back in February, in response to a question about the chain’s underperformance. “We’ve been doing promotional activations, including paper coupons and other value approaches, which haven’t been resonating.”

So Burger King has begun shifting toward more digital coupons and deals. Earlier this year, it began rolling out its new “Royal Perks” loyalty program. “We’re excited for members to unlock a more personalized BK experience and access to rewards they can’t get anywhere else,” Burger King North America’s chief marketing officer Ellie Doty said last month.

“We believe we’ll be able to shift to a much more accretive digital coupon and digital engagement program over time,” Cil said this week.

Of course, by working to attract younger customers with digital offers, Burger King runs the risk of alienating and driving away older customers who like paper coupons. “We know this decision will impact our results in the near term, but believe it’s the right one,” Cil said confidently.

Then again, cutting back on paper coupons could also drive away customers who like their paper Burger King coupons a little too much – to the point that they’ll cause a commotion if their coupons aren’t accepted. For whatever reason, Burger King restaurants have been the scene of some of the most notorious coupon confrontations of all. Back in 2016, a Wisconsin woman and her daughter were arrested after the woman was told she couldn’t use multiple coupons in a transaction, so she sicced her daughter on the cashier for “disrespecting” her. In 2018, a Florida man was arrested after he allegedly grabbed a cashier by the wrist “and began to pull her over the counter” when his coupons were refused. And last year, an Iowa man was arrested for allegedly hitting a Burger King employee in the head with a cell phone after the employee wouldn’t accept his coupon. Two other incidents, in South Carolina and Connecticut, didn’t involve actual violence, but customers in both cases were arrested after threatening gunplay.

So maybe cooler heads will prevail with digital coupons? Burger King’s owner likely hopes so. And digital coupons are only part of its modernization plan. In addition to the new loyalty program, Burger King is updating its drive-thru menu boards so they’ll be able to communicate with the loyalty app on your phone and display customized promotions and suggestions based on your favorite purchases.

“It’s clear we’re navigating a transition,” Cil said. Paper coupon fans may find themselves left out, but Burger King aims to offer a new generation more savings, more convenience – and hopefully less violence.

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