Tim Hortons usually rolls out its wildly popular Roll Up the Rim promotion by the first week of February, offering sweepstakes tabs on medium or larger hot beverage cups. But the contest, which typically runs through April, is nowhere to be found.
So what's going on?
Turns out, the company has already given away too much free stuff.
Tim Hortons' loyalty rewards program, which went live in April and offers a free beverage or doughnut for a customer's every seven visits, has cost the company dearly. Sales at the chain dropped $150 million last year compared to 2018, the company said during an investor call Monday.
"We've attracted far more guests to our loyalty program far more quickly than we planned," said José Cil, chief executive officer at Restaurant Brands International, which owns Tim Hortons.
The program has 7.5 million members.
It's not that the company didn't expect to lose money on freebies, it said. But it had expected the rewards program to pay off in other ways, such as enticing customers to try new products.
So far, that hasn't happened. As a result, the company has decided to overhaul its rewards program and hold off on this year's Roll Up the Rim promotion for now.
Established in 1986, Roll Up the Rim used to be a big sales driver, but the promotion's impact has faded, the company said. Last year, Tim Hortons said it would revamp the program, in an attempt to bring back some of that old excitement. Part of the revamp would involve moving the contest away from its cups and onto the internet.
The chain hasn't yet said how Roll Up the Rim will be different or when it will return. It has, however, announced changes to its loyalty program that will go into effect later this month.
Under the new rewards structure, members will earn 10 points for every purchase, and the points can be redeemed for free products. Customers will not be losing any value under the new math, the company said, because 7 visits (70 points) will still equal one free coffee, tea, bagel or doughnut. But customers will have the opportunity to save their points to be used toward larger purchases such as sandwiches, which cost 220 points.
Tim Hortons wants members to put those extra points toward new products they haven't tried before, and turn them into bigger-spending customers. To do that, it needs them to register online so it can send them targeted offers. But only a quarter of members have done so.
In an attempt to drag customers online, the company plans to make the program less rewarding for unregistered users. In April, any member who hasn't yet registered online will have to make 12 purchases rather than seven before they get a reward.