Burger King’s newest discount is quite a whopper.
The calculus is simple: Sell cheap coffee, sell more breakfast. If subscribers ordered coffee everyday of March, they’d pay roughly 16 cents per piping-hot cup. And while they’re at it, they might just pick up a breakfast sandwich or pancake platter on their way out.
“Fast food restaurants find ways to get some items that don’t necessarily sell well, and find attention-getting discounts to get people in the door,” said Jonathan Maze, executive editor of Restaurant Business Magazine. “This is a classic example of that.”
Fast food wars are, in part, fought over breakfast. Dunkin’ Donuts hooks customers with its coffee and doughnuts, and Starbucks obviously generates its own share of the morning coffee rush. When McDonald’s rolled out its all-day breakfast menu in 2015, sales sizzled. And it kept the momentum going — and its stock rising — by expanding its breakfast offerings over the next few years. In 2018, the company’s chief financial officer said the strategy was meant to “win back customers at breakfast."
At the time, the golden arch’s chief executive, Stephen Easterbrook, added: ““It’s very competitive out there at breakfast."
(Fast food is gritty competition: In 2018, Burger King offered customers 1-cent Whoppers if they placed an order within 600 feet of a McDonald’s.)
The fast-food industry as a whole has struggled with breakfast foot traffic. A February report from the market research firm Mintel said fast-casual restaurants would have to get creative if they wanted to attract customers beyond lunchtime, including through wider breakfast options in the morning or happy hour specials in the evening. The report said that only 6 percent of those surveyed mainly visit fast-casual restaurants for breakfast. That’s compared with 42 percent who said they mainly visited for lunch.
Part of that competition, Maze said, comes from the fact that breakfast habits can be hard to break. People get used to a morning routine of, say, picking up coffee from McDonald’s on their way to work.
At the same time, any franchise that offers steep discounts could feel a burn. Even if coffee for $5 a month is enough to get customers in the door, franchise operators still run the risk of losing profits on a high-margin menu item, Maze said.
“If you go ten times [in a month], that’s 50 cents a cup,” Maze said, “so you’re taking a lot of profit out for the franchises.”
So for Burger King, the question comes down to whether seriously cheap coffee is enough to perk up the breakfast rush and change the perception of at least one Twitter poster: “Do you ever get a coffee from Burger King?”