This article first appeared on Global Convenience Store Focus.

If there is one thing key trend in the loyalty industry right now, it’s the sheer number of brands launching, announcing or enhancing their loyalty programmes, and one brand that’s just getting in on the action is Tim Hortons® – the Canadian brand that operates one of North America’s largest quick service restaurant chains with over 4,800 locations in Canada and around the world. Tims^TM Rewards arrived in Canadian and US restaurants last month in response to demand from customers, so we’re delighted to bring you our insights and ideas about what they’ve launched and why.

With COO Mike Hancock describing the project as “the biggest thing that Tim Hortons has worked on this year”, it’s clear to see that business expectations of this programme are high. In Hancock’s words, “folks are very excited about the long term impact of loyalty”, so it will be exciting to see the adoption and success of the programme in the coming months.

Tim Hortons Digital Loyalty Programme – March 2019.

Tims Rewards – How it Works:

1. The loyalty programme is super simple – it is based on visits.
2. After seven visits, members earn a free hot tea or coffee of any size OR a baked good as their reward. As always, some exclusions apply to both the drinks and the baked goods offered as reward options.
3. Registration is incentivised with an ‘almost-instant’ reward when you register and spend over $1.50 CAD.
4. There is no fee to join the programme.
5. Two rules apply:

i) Each “visit” must include a scanned purchase over 50 cents.

ii) Visits must also be more than 30 minutes apart (this prevents delays at the till by customers trying to game the system).

Driving Frequency for Coffee and Doughnuts 

The Competition in Coffee

Retail brands globally are continuing to invest heavily in loyalty programmes, with recent enhancements announced by Starbucks as well as the recent addition of a digital app to the ‘fun and easy’ McCafé sticker system. And in the fuel market, Shell UK has just announced a major new scheme called Shell Go+ which we’ll be discussing in a future article.

While Hortons boasts an “increased focus on technology”, it seems Canadian customers still like plastic, as members can choose either a physical (plastic) loyalty card or the digital app-based version.

Apart from the dual-channel approach, the loyalty mechanic is interesting – specifically the decision to reward visits rather than spend. This strategy makes sense when compared to McCafé (as it’s almost identical), however it’s interesting to note that Starbucks moved away from visits to instead reward customer spend in dollar terms. As one of the biggest decisions for any loyalty programme to make, there’s no doubt that considerable research with both business stakeholders and consumers would have been conducted to arrive at this decision on the loyalty mechanic and what behaviour to recognise and reward.

With “frequency of visits” winning out, Tims^TM Rewards has at least gone a step further with their rewards by including the option of a free baked good, and in our experience customers value flexibility as well as generosity when it comes to “feeling thanked” as the brand intends.

So which programme is performing best with customers? One article that compares these three coffee-led programmes and includes an online survey produced surprising results – although perhaps this early result is simply a reflection of the newness of Tims Rewards.

Payment Card Also Earns Rewards

While Tims Rewards is the first loyalty programme available to the entire customer base, it’s also interesting to note the “Double Double” Visa card launched more than five years ago with CIBC bank, offering one percent rewards back in Tim Cash® for using the co-branded Visa card. Tim Cash® is the currency used on the company’s pre-paid cash card or TimCard®.

The card used “first-of-its-kind two-button technology” to allow customers to choose their benefits from each payment transaction, as well as free coffee and Timbits® on the member’s birthday.

The card also includes a Tim Hortons reward every weekend of the month if the payment card is used the preceding month, and with no annual fee, offering a clear, consistent and compelling reward for Visa card customers on their everyday spend.

The Double Double Visa Card from CIBC and Tim Hortons.

Key Success Factors for Loyalty

One key success factor for any loyalty programme is a Board-level commitment to investing in customer loyalty. While Tim Hortons is clearly responding to market trends with the launch of their programme, it also seems to have full C-Suite support, with the business announcing their target of 100% adoption by customers. Time will tell if this programme is as successful as their ambitious targets aspire to be.