Burger King is launching what you could call the "MoviePass of Coffee," a disruptive new subscription program that takes the fast food value menu wars to a whole new level.
Photo courtesy of Burger King
For $5 per month, you can get a small cup of hot coffee at any participating Burger King location at any time of the day. All you have to do is sign up for the offer on Burger King's app, and open the app daily to get your coffee fix.
To put that amount of cost savings into context, the average American paid $2.70 for a cup of coffee in 2015, and a current tall drip coffee at Starbucks is just around $2. With Burger King's subscription program, you would pay 17 cents per cup, translating to over a 90 percent drop in price.
In terms of caveats, there seem to be very few with the subscription model. The limitations are that you can only use this to redeem on small hot coffees (no specialty or iced beverages), and that freebies don't carry over to the next day if you don't use it. There's no forfeit for not getting coffee every day, however.
With this new program, Burger King just vaulted itself to the top of the coffee value menu game, since their cost just became significantly lower than the Starbucks Reward program or McDonald's McCafe and Dollar Menu offerings. It's pretty similar to what MoviePass did with movies, but doesn't have the issues MoviePass had with theatres refusing to accept it.
The strategy itself is pretty genius on Burger King's end. By alluring people to come on a regular basis for their hot coffee, it entices new customers to buy other items on their menu, whether it be breakfast or lunch time. Thus, the big success here will come if BK generates sales on secondary items, but the instance somebody like McDonald's does this for a lower price, competition will get fierce.
Considering how fast AMC and other rival movie chains came out with similar subscription models, it should only be a matter of time before other chains follow Burger King's lead. Whether that's a good thing for a coffee industry struggling to find space to grow more beans remains to be seen.