Primary Insights Efforts – BKC Discounting

Our “primary insights efforts,” which included a survey of various Burger King restaurant managers/employees, showed that 78% of the restaurants surveyed are currently offering some type of corporate promotion/incentive. According to restaurant employees, these promotions include “buy one, get one free,” the Value Menu, and various meal coupons distributed primarily through newspapers and the mail. Most respondents agreed that the incentives have helped to generate more sales. We did not ask, however, how these discounts are impacting margins. On a more positive note, a handful of the BKC employees did highlight that the corporate office has introduced new and different sandwiches which are helping to drive sales.
  • As I have said before, discounting has become more prevalent across the QSR industry as restaurant operators attempt to drive increased traffic (often at the expense of margins), so BKC is not alone. Recent NPD trends also show that BKC’s percent of visits on deal has continued to tick up. The same can be said for the entire QSR hamburger category which has seen its level of discounting climb rather significantly since mid-2007.
  • We will follow up with other primary insights efforts results, including a look at BKC’s current sales trends.

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