Friday , March 29, 2024

Burger King Has Its Way With a New Mobile-Payments and Loyalty App

By Jim Daly

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It may perennially trail McDonald’s Corp. among the leading U.S. hamburger chains, but Burger King Worldwide Inc. is on track to take the lead in mobile payments. Miami-based Burger King this week said it plans to roll out a smart phone app offering mobile payments and digital-coupons beginning in April. The virtual coupons will be available chainwide first, but mobile payments soon will be accepted in “a sizable number” of Burger King’s 7,000-plus U.S. stores, a company spokesperson says.

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The app, which will work on Apple Inc.’s iPhone and smart phones running Google Inc.’s Android operating system, will include a digital wallet. The system comes from San Diego-based Tillster Inc., developer of multi-platform loyalty applications and online-ordering systems through its Snapfinger subsidiary. Forty quick-service and fast-casual restaurant chains use Tillster applications.

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“This new scalable mobile app will improve the guest experience by eventually allowing guests to receive desirable and specific offers as well as access to a digital wallet, which they can use to make payments,” the Burger King spokesperson says by email. “The application also provides the Burger King brand and its franchisees with rich data about in-restaurant buying habits, which it will use to improve the guest experience.”

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The mobile app will work with a virtual BK Crown Card or physical card that the customer links to the app in its “Wallet” section. Burger King did not provide details on how the system will work with those physical cards.

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To pay with the virtual proprietary card, the customer clicks “Pay with BK Crown Card” directly from the wallet if payment is the only action. The app generates a unique four-digit code. The cashier enters that code, which is validated in real time. Then the restaurant’s point-of-sale system immediately processes the payment and deducts the purchase amount from the card balance. The app then displays the new account balance.

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If the customer is redeeming a coupon, he or she is prompted with a question about paying digitally, which also generates a four-digit code that the cashier enters. Burger King says the couponing system will be able to generate market-specific and personalized offers based on product preferences, times of visit and a customer’s favorite restaurant locations.

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Besides virtual coupons and payments, the app also features menus and a store locator. Burger King says it plans to add more functions later, including pre-ordering, games, and customer surveys.

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The company also says the app will require “minimal hardware and software investment from most franchisees,” and is available regardless of which approved POS system a store uses, the spokesperson says. “Franchisees will have to take a small number of steps to ensure that their restaurants can accept mobile payments, but it is anticipated that these benefits will rapidly drive adoption,” the spokesperson says.

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Burger King’s new app vaults the chain ahead of McDonald’s, which has tested mobile payments, but the reigning restaurant king in mobile pay is Seattle-based Starbucks Corp., which has a smart-phone app linked to its closed-loop prepaid card. Starbucks this week reported that 14% of its U.S. payments now come through the mobile channel, up from 10% as recently as mid-2013.

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Noting that Starbucks constantly offers rewards through its mobile app, Julie Conroy, a senior analyst at Boston-based Aite Group LLC, says Burger King’s mobile-payments volume will depend on how well its couponing program encourages customers to use the app instead of paying with cash or physical cards. “I think the success of it really comes down to what are they going to do incentive consumers and get them to use it,” Conroy says, adding that “Starbucks is positive proof” that it can be done. “You look at other retailers that have done these types of things…it’s not necessarily about the form factor, but incentivizing consumers to change their behavior.”

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