Tim Hortons has enhanced its popular Roll Up the Rim to Win contest, ahead of the release of its 2013 fourth-quarter results Thursday and the unveiling next week of its five-year strategy to boost sales.
The Canadian doughnut and coffee chain's fourth-quarter results are expected to show a slowdown of same-store sales because of the bitter winter in Ontario and Quebec. Same-store sales, meaning the increase in revenue from each individual store not including new locations, are considered an important indicator in retail.
"Our outlook for Tims is unchanged heading into the fourth-quarter release, as negative traffic in Canada remains a concern," said Barclays analyst Erica Chase in a note.
Analysts also expect the company will boost its dividend, as it often does when year-end results are announced.
In the third quarter, Tim Hortons said same-store sales were up 1.7 per cent in Canada and three per cent in the U.S.
Canadian sales rose on higher prices, but analysts had expected more from the chain, which appointed former Nestlé executive Marc Caira as its new CEO last July.
The new five-year strategy, which will be announced at an online investor conference on Feb. 25, is expected to address stiff competition from McDonald’s coffee and from others in the fast-food sector.
That announcement may outline changes in the menu that could streamline the Tim Hortons offering and perhaps reduce long lineups.
Caira spoke to The Canadian Press last fall about his plans to boost the reputation of the company, saying he wanted to improve customer experience and satisfaction.
"Future battles are not going to be won, in my view, with who has the best strategy or who has the best innovation," Caira said.
"The companies that will win will be the companies that can execute flawlessly at the store level."
Addressing coffee, fast-food competition
In the meantime, the company hopes to woo more coffee drinkers by offering two chances to win on each cup in its annual Roll Up the Rim to Win contest.
Customers are invited to roll the rim twice, looking for prizes such as a new car, $5,000 Visa prepaid cards, $100 Tim Cards, and millions in coffee and food prizes. The second roll gives a chance to win one of 10 more new cars.
There is also an online contest called Roll Up Roulette with additional prizes.
According to Tim Hortons, the chances of winning are one in six. The contest is no longer just in Canada.
Roll Up the Rim to Win runs across Canada and the United States, starting Monday and running to April 25.
Last November, Caira spoke of diversifying the company internationally, but did not say which countries were being considered for the expansion.