Burger King Commits $400 Million to U.S. Brand Reset

This is an English adaptation of a FoodBud historical article originally published on September 12, 2022.

On September 9, Burger King announced “Reclaim the Flame,” a plan designed to improve franchisee sales and profitability.

The chain said it would invest $400 million over the following two years: $150 million for advertising and digital marketing, and $250 million for restaurant technology, equipment, remodeling, and upgrades.

RBI, Burger King’s parent company, said the U.S. investment was intended to strengthen nationwide sales growth and modernize the brand.

Franchisee Support and Marketing Spend

The plan had support from more than 93% of Burger King’s U.S. franchisees, who also agreed to increase advertising contributions over the coming years.

Under the agreement, Burger King planned to spend $120 million on U.S. advertising over two years to drive traffic and accelerate sales growth. After the 2023 and 2024 spending period, participating franchisees whose restaurants reached certain profitability levels would increase their advertising fund contributions by 50 basis points through 2028.

Burger King also planned to allocate $30 million to digital channels, including its loyalty program, personalized offers, and improvements to delivery and in-store pickup convenience. At the time, digital channels generated about $900 million in annual U.S. sales.

Restaurant Upgrades

The $250 million restaurant reset had two main components:

• $50 million over two years to upgrade about 3,000 restaurants together with franchisees.
• $200 million to remodel about 800 restaurants, with a focus on reinforcing awareness of the Whopper and building what Burger King described as a chicken sandwich platform worth owning.

Burger King had already been in a multi-year brand reset. In 2021, the chain overhauled its logo and brand identity for the first time in 20 years, returning to a more classic look built around the Whopper and natural colors.

Burger King said in its release that prior remodel programs generated an average 12% sales lift in the first year of implementation.

U.S. Competitive Position

According to QSR’s annual Top 50 report, Burger King ranked seventh in U.S. quick-service sales in 2021. Its U.S. sales trailed McDonald’s, Chick-fil-A, Taco Bell, Wendy’s, and other major brands, even though Burger King had more U.S. units than Chick-fil-A and Wendy’s.

At that point, Burger King’s changes had not yet produced a material sales improvement. U.S. sales in the second quarter declined slightly, down 0.3% year over year. Other burger competitors grew during the same period, with McDonald’s up 3.7% and Wendy’s up 3.5%.

RBI System Scale

According to RBI’s latest financial report at the time, as of June 30 its four brands — Burger King, Tim Hortons, Popeyes, and Firehouse Subs — had 29,747 restaurants in total. Nearly all were franchised.

Burger King had 19,311 restaurants globally, with net restaurant growth of 2.8% in the second quarter.

Note: forward-looking spending, contribution, sales-lift, and growth figures are historical plans or reported figures from 2022.