Dunkin Donut Case Study

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1 Dunkin’ Donut Case Study Dunkin’ Donuts Case Study DeAndra Butler Albany State University MKTG 6170: Marketing Management Dr. Edwin Odipo Nyamwala

2 Dunkin’ Donut Case Study Marketing Strategies to include when changing a product focus in a company. In 2019 Dunkin’ Dounts dropped the “Dounuts” and rebranded as Dunkin’. Now the company would not only prioritize doughnuts but other items like coffee and breakfast sandwiches as well (Wida, 2019). When a company closely identified with one product decides to change its focus to a different product, there are several risks to consider. Customers may be confused or disoriented by the sudden shift, leading to a loss of brand identity and loyalty. Customers who were initially drawn to the company for its original product may feel alienated and no longer see the brand as relevant to their needs. Entering a new product category often means facing well-established competitors. The company may lack the experience and resources to compete effectively. Producing and marketing a new product may require different expertise, supply chains, and infrastructure, leading to operational challenges (Johnson, 2022). Promoting the new product category requires significant marketing and advertising investments, which may strain the budget. To reduce the risks and increase the probability of success, a company should consider several marketing strategies. Instead of an abrupt shift, a company can gradually introduce the new product category while still maintaining the original core product. This allows time for customers to adapt and accept the change. Implement a robust educational marketing campaign to inform customers about the new focus. Explain how the new product category complements and enhances the existing product line, providing added value. Identify customer segments that are most likely to embrace the new product and tailor marketing efforts toward them (Howl, 2023). This minimizes alienating the core customer base. Dunkin’ Donut implemented a loyalty program that

3 Dunkin’ Donut Case Study rewards existing customers for trying new products. They offer incentives and discounts to encourage trial (Wida, 2019). Companies should listen to customers’ feedback and make adjustments based on their input. An iterative approach allows the company to fine-tune the new product offering. Dunkin’ Donuts’ shift to emphasize coffee alongside its core product is an example of how a company can successfully manage a change in focus. By implementing these strategies, a company can navigate a shift in product emphasis while preserving its brand’s strength and mitigating the associated risks. Dunkin’s marketing strategy vs. Starbucks’ Dunkin’ Donuts and Starbucks are two prominent coffee house chains, but they have different marketing strategies and brand identities. Dunkin’ Donuts typically positions itself as more affordable, catering to a wider demographic. Starbucks, on the other hand, is often seen as premium and commands higher prices. Donkin’ Donuts offers a broader menu that includes coffee, donuts, and breakfast items. Starbucks primarily focuses on coffee and espresso-based beverages. Starbucks provides a cozy, third-place experience with inviting interiors and a slower-paced environment. Dunkin’ Donuts often emphasizes quick service and convenience. Starbucks often emphasizes its commitment to ethically sourced coffee, and its brand is associated with social responsibility (Johnson, 2022). Dunkin’ Donuts focuses on a more every day, no- nonsense image. Competitive Strategies for Dunkin’ Donuts Given Dunkin’s reputation for quick service, it can continue to emphasize convenience by offering drive-thru options and mobile ordering. This resonates with

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4 Dunkin’ Donut Case Study busy customers looking for a speedy coffee fix. While known for affordability, Dunkin’ Donuts can introduce a premium coffee line to capture the customers who want a higher end coffee experience. This can compete directly with Starbucks in terms of quality. They could regularly introduce innovative and sessional menu items that generate excitement and drive customer traffic. Cater to the growing demand for healthier options by expanding the menu with more nutritious choices. Think beyond coffee and donuts to offer unique and trendy products (Panel, 2023). Dunkin’ Donuts can experiment with store designs that create a welcoming atmosphere. They don’t have to replicate Starbucks’ cozy ambiance but find a unique approach that differentiates Dunkin’ Donuts. Continuing to invest in technology to enhance the mobile app and loyalty program is a great way to compete. Foster a sense of community by engaging in local initiatives and supporting local businesses. Use data analytics to personalize offers and recommendations for customers. Dunkin’ Donuts can compete with Starbucks by leveraging its strengths in convenience and affordability, while also differentiating itself through premium coffee offerings, healthier menu items, sustainability initiatives, and a strong focus on local community engagements. Success will depend on a well-executed marketing strategy that appeals to a broad range of customer preferences. Loyalty Programs and Customers staying Loyal Loyalty programs like DD Perks can indeed engage customers and incentivize them to stay loyal. However, they are not the only factors that drive brand loyalty. Exceptional customer service (my most important factor in staying loyal to any brand), friendly staff, and effective service contribute to a positive customer experience.

5 Dunkin’ Donut Case Study Accessibility and convenience are critical to brand loyalty. Dunkin’ Donuts’ drive-thru locations and focus on quick service have historically appealed to customers looking for a hassle-free experience. Introducing new and innovative menu items, seasonal offerings, and limited-time promotions can keep customers excited and engaged (Wida, 2019). Dunkin’ regularly introduces new products to cater to evolving customer tastes. A strong and relatable brand image can resonate with customers. Dunkin’ has often presented itself as an everyday, no-nonsense brand, which appeals to certain segments. Involvement in local communities and support for social causes can build a strong emotional connection with customers. Dunkin’ can leverage its local roots for community engagement. An engaging and user-friendly mobile app and website are increasingly important in this digital age, DD Perks and Dunkin’ loyalty app, plays a role in this aspect (Johnson, 2022). Brands that demonstrate environmental and social responsibility can attract customers who share those values. Dunkin’ has an opportunity to strengthen its sustainability initiatives. To increase customer loyalty, Dunkin’ can consider continuously training and empower employees to provide excellent customer service, creating a memorable and positive experience (Panel, 2023). Implementing sustainable practices in sourcing, packaging, and operations. Communicate these efforts to appeal to eco-conscious customers. They should keep introducing new and exciting menu items while staying true to the core brand values. Further improve the DD Perks app and expand the features to create a seamless and rewarding digital experience for customers. Actively solicit and respond to customer feedback, demonstrating a commitment to improving the customer experience. By combining the strength of DD Perks with these additional

6 Dunkin’ Donut Case Study strategies, Dunkin can deepen customer loyalty and further differentiate itself in a competitive market.

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7 Dunkin’ Donut Case Study References Howl, M. (2023, March 10). 3 risks that come with rebranding - and how to overcome them . Entrepreneur. https://www.entrepreneur.com/growing-a-business/3-risks- that-come-with-rebranding-and-how-to-overcome/446548 Johnson, J. (2022, June 17). 6 steps to market your business in a competitive market . https://www.uschamber.com/co/. https://www.uschamber.com/co/grow/marketing/marketing-your-business- competitive-market Panel®, E. (2023, September 12). Council post: 16 effective marketing strategies to boost sales in 2023 . Forbes. https://www.forbes.com/sites/forbescommunicationscouncil/2022/12/19/16- effective-marketing-strategies-to-boost-sales-in-2023/?sh=6a8da81929d7 Wida, E. C. (2019, January 4). Dunkin’ donuts has officially changed its name - see the new Dunkin’ . TODAY.com. https://www.today.com/food/dunkin-donuts-officially- changed-its-name-dunkin-t146257

Dunkin Donut Case Study

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