A Burger King Whopper burger is displayed on April 05, 2022 in San Anselmo, California.
Justin Sullivan | Getty Images
More customers of Burger King and its sister brands are redeeming loyalty program coupons and rewards as inflation drives up menu prices.
Restaurant Brands International CEO Jose Cil told CNBC the company hasn’t seen any significant change in what customers are buying at its restaurants. Its chains, which include Popeyes Louisiana Kitchen and Tim Hortons, have raised menu prices this year to mitigate rising costs for key ingredients like chicken and coffee.
But Cil noted that the broader fast-food sector sees lower-income consumers spending less money on burgers and fries, while higher-income diners appear to be shifting away from casual or fast-casual restaurants. The owner of KFC, Yum Brands, McDonald’s and Chipotle Mexican Grill all recently told investors they see the trend emerging.
Instead of selling fewer combo meals, Restaurant Brands restaurants are seeing an increase in customers using paper coupons and loyalty program rewards to lower the price of their meal.
“It suggests that people are looking for value for money,” Cil said.
Burger King has moved away from paper coupons in recent months in an effort to entice those consumers to download its mobile app and join its loyalty program. In exchange for exchanging their points for free menu items, the burger chain learns more about its customers and how to target them more effectively with promotions and offers.
The strategy is part of a broader turnaround for Burger King’s U.S. business, which has struggled to keep up with rival burger chains in recent quarters. Restaurant Brands plans to unveil a plan to relaunch the business in September.
Shares of Restaurant Brands rose more than 6% in afternoon trading after the company reported improving demand for Tim Hortons coffee and growing international sales at Burger King.