How Tim Horton's deteriorated due to Brand inconsistency
Tim Horton is making its way to India and will be launching its cafes soon. Starting the base by setting up its cafes in the metro towns, Tim Horton's has been in the global news for quite some time.
The reason for Tim Horton’s headlining the front page of the newspapers is due to its trend of a steep decline for the past couple of years.
While McDonald's stock has increased by 60% in the last five years, Restaurant Brands International, which owns Tim's, has remained unchanged. This timeline coincides with the time they have been owned and operated by the cost-slashing, private equity company, 3G Capital.
While Tim's has maintained large advertising budgets and a constant stream of new product offerings, their treatment of franchisees has been hostile, and the franchisees' treatment of employees has been despicable. Wage disputes, cancelled coffee breaks, and layoffs have all made the headlines in recent years.
The question is- How can a coffee company get rid of its coffee breaks?
As per the last drawn reports in Canada, and even more due to after-effects of the COVID-19 pandemic and lockdown, the toxic culture of Tim Horton's is having an impact on the customer experience.
When a workforce is disgruntled, customers rarely hear "please" or "thank you," and they rarely see a smile. Going to Tim's now feels cold and hollow in comparison to the warmth of a Starbucks encounter. The consumer experience is not representative of how Canadians see themselves, and the brand continues to deteriorate.
What are the major issues being faced by the Organisation?
Back in 2018, Tim Hortons had dropped from 13th to 67th place in the Reputation Institute's analysis of Canada's most reputable corporations. An Ipsos survey also revealed that 35% of respondents claimed their view of Tim's had deteriorated tremendously.
According to the research, 25% thought that the service has gone worse, and 19% say the coffee is now no more delectable. The coffee is still the same, but when our attitudes about the brand and the consumer experience deteriorate, consumers are forced to reconsider their whole relationship with the brand.
Tim's has been making headlines in Canada, but for the wrong reasons:
1. The renowned Canadian coffee company is eliminating coffee breaks for its employees
Back before the pandemic started and took over the world, approximately 50 anti-Tim Horton's protests took place across Canada in just 2 years. As Tim Horton's is supposed to represent the typical Canadian, the image of the average Canadian fighting back against them shatters all goodwill.
2. Tim's and its franchisees have had a deteriorating relationship for the past decade
In 2018, Ontario increased the minimum wage from $11.90 to $14.00 per hour, making things even worse. Tim's declined to accept menu pricing hikes to assist offset wage increases, although McDonald's and Starbucks did. They were paying the franchisee $7,000 per hour on average. Franchisees responded by reducing employee benefits such as paid coffee breaks and health-plan contributions.
3. Introducing a vegetarian sausage and vegetarian burger- but to a wrong audience
Aimed at the rapidly growing vegan and vegetarian population in Canada, Tim Horton had introduced a vegetarian sausage that may be served in a wrap or a biscuit. The meatless sausage contained dairy cheese and an egg. Because of the poor response and bad market research, Tim stopped making the vegetarian sausage a few months later.
4. Introducing a not so different loyalty card
Tim's had introduced a new loyalty card that rewards customers with a free coffee or doughnut after their seventh transaction. The issue was that customers started to notice that not every store accepts loyalty cards. This further deduced the relationship of Tim Horton's with its customers
What does this tell us about effective Brand management and being consistent on the consumer’s touchpoint?
Each of the customer touchpoints is managed by the finest brands.
Brand managers must ensure that the brand message is delivered consistently across all customer touchpoints. Everyone should turn to the brand concept to guide and concentrate their decisions, whether they are in management, customer service, sales, HR, operations, or an outside agency.
The brand promise, brand story, innovation, buying moment, and consumer experience are the five major touchpoints that reach customers.
They reach the customer regardless of the sequence; if the brand does not offer a consistent message, the consumer will be confused and will most likely reject the brand. While brands have little control over the sequence in which each touchpoint reaches the customer, they can surely match each touchpoint with the brand idea.
Tim Horton's through this example clearly demonstrates that the brand message is not consistent throughout all the touchpoints. People working within the organisation are not aligned with what Tim Horton wants the people working and interacting outside to know and feel about their brand
Result- Neither the customers nor the workers are happy
Not only should your brand concept guide all customer interactions, but it also serves as an ideal audit for areas where the brand idea is not being delivered. Tim Horton's continues to focus on the brand promise and story but they have a perplexing innovation and a buy moment and consumer experience failure.
Brands like Tim's seem to believe that a new ad or new product would solve a problem that is clearly aggravating to customers. The solution- Repair your connection with your franchisees, encourage them to do the same with their staff, and leverage your brand to drive a best-in-class consumer experience.