This piece was originally published in the Summer 2024 issue of strategy magazine

By Megan Haynes

For Tim Hortons, everything is about finding equilibrium. The Canadian chain navigates a delicate balance between catering to die-hard loyalists who crave the familiarity of daily coffee and doughnuts, and newer patrons – particularly adventurous Gen Zers – seeking novel experiences. It has to get the right combination of retail promotions to drive store sales and bigger brand marketing to build longer-term loyalty. And now, as it celebrates its 60th anniversary, Tim Hortons needs to find a balance in preserving its robust legacy while embracing a modern outlook for the future.

For CMO Hope Bagozzi, who joined the QSR in 2020 after 15 years working for McDonald’s, it’s all about getting the product mix just right. She sees Tims’ food selection as the key to unlocking future growth, and she’s on a quest to move the chain, once known almost exclusively for its coffee and doughnuts, “beyond brewed.”

As she looks at the coming decade, she sees huge opportunities in new meal occasions, like late afternoon and evening snacks, as well as in beverage offerings, such as cold brews and iced lattes. And, as she sees it, the marketing activity over the past decade has been setting the stage for those efforts.

“I think the whole thing for Tim’s is about [conveying] authenticity,” she says. “Everything we do… it’s about trustworthiness. I think Tim’s is a brand that people can rely on, and so I think our marketing needs to have that same approach so that it’s forthright, it’s honest.”

It’s been 10 years since Tim Hortons’ $12-billion merger with Burger King. The deal, backed by Brazilian firm 3G Capital, created a new parent company Restaurant Brands International (RBI) and set the popular Canadian coffee chain on a new path. And though it hasn’t always been smooth sailing, it’s definitely been a ride.

A 50th birthday present

In the 2010s, Tim Hortons was on a brand high. As it approached five decades in business, the chain had more than 4,000 locations and pulled in an annual revenue of more than $2.8 billion. Tims’ 2011 report estimated that it commanded 41% of overall QSR share and 28% of the quick-serve coffee market in Canada.

The Tim Hortons brand had a strong connection with Canadians, in no small part thanks to the popular and effective “True Stories” campaign by then-AOR J. Walter Thompson (JWT). The campaign ran in various iterations from 1994 to 2008, and included iconic commercials such as the refugee father stocking up on winter gear (and coffee) to meet his newly arrived family, as well as the father-son pair watching the grandson at hockey practice, also with coffee in tow. Each heartwarming spot showcased the ubiquity and importance of the brand in Canadians’ lives.

It was the overall strength of the brand and Tims’ growth potential that attracted the Burger King merger in the first place, according to media reports at the time.

The deal closed December 15, 2014, and then Tim Hortons hit some turbulence. In January 2015 – less than a month later – news broke about mass layoffs at the head office, with reports estimating upwards of 25% of the company’s head office employees had been let go. Well into 2018, franchise owners and RBI waged a public battle over fees, and in that same year, the chain received flak for changes to its worker health and dental benefits program following minimum wage hikes.

Trust in the brand took a dive. A 2016 poll by Leger saw the company dip from a high of fourth-most trusted brand in Canada all the way to 27th place. In 2018, a reputation poll from the University of Victoria saw Tims rank as the 203rd-most trusted brand in Canada, when just three years earlier it held the top spot.

And this was impacting profit, with sales growth slowing significantly between 2015, when it peaked at 5.5%, and 2019, when it saw a decline of 0.3%.

Potentially compounding the issue, marketing dollars shifted away from brand-building and towards product promotion – with Bagozzi estimating that upwards of 80% of spend was going towards retail promotion at the time, focused primarily on pushing the new limited-time product launches.

This was problematic, Bagozzi says. “There probably wasn’t much traction because [the menu items] were here for a limited time, and then it would be onto the next thing the next month,” she says. “That is exciting for guests to try, [but] there wasn’t the development of long-term platforms that keep them sticky.”

Turning tides

In 2018, RBI’s then-CEO Daniel Schwartz said in an earnings call that the company “had to take urgent and decisive action” to address the issues of falling brand sales and trust.

New talent joined the Tim Hortons C-Suite, including then-global CMO and now-president Axel Schwan. In 2018, Tims brought on new agency partners including Toronto-based Zulu Alpha Kilo and Miami shop Gut, ending a nearly three-decade partnership with JWT. Finally, the company announced an $800-million revitalization plan, which included improving product quality, as well as investing in the Tims Rewards program and other digital offerings – all aimed at winning back consumer trust.

As part of the company’s “Back To Basics” plan, Schwan’s early work honed in on the brand’s core building blocks, focusing on things like coffee and community. Early campaigns under his direction included a look at the chain’s coffee making process, with an ad spotlighting the humble coffee bean as it makes it way to cups, featuring real coffee growers and roasters. Another spot invited neighbours who’d never met to share a coffee and get to know each other.

The creative set the tone for what would be the biggest investment in brand-building since RBI’s acquisition. “At its best, [Tims can be] a brand that connects with Canadians in an authentic way,” says Dino Demopoulos, former chief strategy officer at Gut. “[However], what we were seeing was Canadians felt disappointed… that the brand that they love wasn’t showing up… in a way that felt authentic and true to what they expected. People were questioning what was happening [at the company].”

To rebuild that trust and reconnect with Canadians, Gut, which formally took over as AOR in 2021, dusted off the spirit of the “True Stories” campaign. The original work was highly effective at reflecting stories about how Canadians interacted with the brand, Demopoulos says, and it was insight that could apply to all future creative from the company.

“One of the key principles that we established was that we would use real people in the advertising,” he says. “As part of that recommitment to Canadians, we would put Canadians front-and-centre in order to depict the relationship they have with the brand.” This resulted in creative from promotions and brand marketing to Camp Day campaigns featuring real customers, employees and store owners, rather than actors.

Even when creative doesn’t feature “real people,” Demopoulos says it’s important that it reflects Canadian values. He points to the 2020 holiday campaign “Snow People,” which showcased a myriad of snow men and women dressed in culturally unique garb. Creative was inspired by the idea that Canadians – many of whom come from various nations, races, religions and heritage – will often dress their snow creatures in clothing from their ancestral lands.

The re-imagined “True Stories” platform was a roaring success, he says, with brand positivity metrics all trending upwards. UVic’s annual brand trust survey has seen the chain creeping back up its ranking – landing at 156th in 2023.

Future legacies

Bagozzi says the company has shifted to a better equilibrium between promotional campaigns (now approximately 60% vs. 80% of the marketing spend) and bigger brand-building activations.

Demopoulos adds that the brand has had to find the right balance between heartfelt legacy and fun modernity, particularly when bringing younger consumers and new Canadians to the fold. He points to the 2021 “TimBiebs” promo, which saw Canadian singer Justin Bieber curate and promote new Timbits flavours and other merch in stores, as a prime example.

“It felt like a new face for Tims, but still connected to the brand because Bieber got his start busking outside of the restaurants,” he says. “Even the design [of the campaign] felt new and interesting, but it also had a nod to the classic iconic Tims logo, identity and brand.”

Tim Hortons is also experimenting with new tech platforms – such as its loyalty app, now home to the fully virtual “Roll up the Rim to Win” promotion, or the custom-built Roblox experience, which saw gamers race through a Tims-themed obstacle course. It’s also expanding the brand footprint (literally) with an Adidas team up on a limited-edition National Doughnut Day shoe collection (see pg .9), and is producing a 70-minute musical entitled “The Last Timbit.”

Next for Bagozzi is a chance to connect with consumers through new meal-time occasions. Since she’s joined, Tims has invested further on other coffee beverages, like cold brews and espresso drinks (a $4.5-billion and a $360-million market, respectively). More substantial snack options, such as the “craveable roast beef sandwich”, savory pastries and flatbread pizzas are designed to bring consumers in the late afternoons when something sweet just won’t cut it. And cold drink quenchers help provide some caffeine-free alternatives for the evenings.

And while the QSR’s expansion into new foods and drinks began well before the 2014 merger, adoption of some of these new products has been slow, requiring franchises to overhaul equipment, retrain front-line staff and even rejig floor plans.

Acknowledging the challenges that come with product expansion, Bagozzi says “it isn’t something that you flip a switch and suddenly you’re there. I think it takes time to make sure you have all the right equipment, making sure that all the owners and [staff] are able to execute really well. It takes time to put the marketing behind it so that there’s awareness built.”

The restaurants and marketing team are in a better place now, she adds, to really capitalize on these opportunities.

One of the big strategic shifts spearheaded by Bagozzi when she joined in 2020 was to create a more stable menu and move away from an over-reliance on limited time offers to draw customers to stores.

The goal, she says, is to provide a more consistent offering, refining when and where to add product innovation, such as exploring bolder, spicier or limited-run flavours on existing menu items. The brand also used its 60th to dust off some old favourites as part of its broader anniversary push, including bringing back six classic doughnuts.

While this is just the start of an upcoming anniversary campaign – which includes creative by Gut, a media buy from Horizon Media and MediaMonks, as well as PR by Craft Public Relations – Demopoulos says the return of the retro faves offers a peak at the brand strategy.

“For the 50th [anniversary] the campaign was built around looking in the rear-view mirror – all the great things Tim Hortons has done, all the different ways it has been part of Canadians’ lives,” he says.

“For the 60th, the focus is… more forward-looking. [We’re showcasing] the ways in which the brand can show up that’s more surprising, more contemporary, more aligned with [current] Canadian culture. It’s such a great challenge, because the brand is so iconic, and we hear this in the research all the time – Canadians really do consider it their brand.”

Tims Retro Donuts — Walnut Crunch and Cinnamon Twist — are displayed alongside a red Tims cup of coffee adorned with a limited-time 60th-anniversary design.

Product launches that shaped Tim Hortons

1976: Tim Hortons debuts the now-famous TimBit, which would become the Canadian household name for doughnut holes everywhere.

1986: The annual Roll up the Rim to Win program launches and goes on to drive sales at the QSR for more than 30 years.

1995: Sandwiches, the first non-bakery-style item added to the menu, kickstarts the brand’s foray into new mealtimes.

1999: The blended Ice Cap was an early test of cold coffee drinks. Tims would later add other blended flavours, including fruit smoothies (2011) and lemonade (2012).

2004: Seeing an opportunity to expand options for tea drinkers in Canada, steeped tea – brewed in a similar manner as coffee – joined the menu.

2006: The QSR, eyeing McDonald’s growing dominance in the breakfast category, began serving hot breakfast sandwiches (pictured above).

2014: To address changing coffee palettes, Tim Hortons introduced Dark Roast to its coffee roster. It would relaunch the offering in 2021.

2011: Joining the likes of Starbucks and Second Cup, Tims introduced espresso-based drinks (pictured right).

2021: Cold brew coffee joined the company’s other chilled drink options.

2022: Tims is the latest QSR to jump on the pizza trend with the launch of Cilantro Lime Chicken and Habanero Chicken, flavours that were also added to the wrap menu.

2024: The QSR adds pizza to its menu.