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Dunkin' Donut
Dunkin’ Donuts is one of the largest American Multinational coffee and Donuts shop chains in
the world. It was founded by William Rosenberg in 1950. Its headquarters is located in Quincy,
Massachusetts. It has operations in 42 countries and 12900 locations.
Dunkin’ Donuts has a unique position in the market which helped the company to grow and
survive over the years. We can get a clear idea from Dunkin’ Donuts’ mission and a vision
statement about this famous company.
Dunkin’ Donuts Mission Statement
Dunkin’ Donuts Mission statement, according to its official site, is “To be the leading
provider of the wide range of delicious beverages & baked products around the kingdom in a
convenient, relaxed, friendly environment, that ensures the highest level of quality product and
best value for money.
We provide our guests, the elegant service and unforgettable experience to meet their
expectations in every single visit. “
Dunkin’ Donuts Vision Statement
Dunkin’ Donuts Vision statement, according to its official site, is “To be always the desired
place for great coffee beverages and delicious complementary donuts & bakery products to enjoy
with family and friends.”
Dunkin’ Donuts Core Values:
Dunkin’ Values include “honesty, transparency, humility, and integrity.”
Significant Events
Founding of Dunkin' Donuts
1948
William Rosenberg founded the company "Open Kettle", the predecessor of Dunkin' Donuts, in
Quincy, Massachusetts in 1948.
Selling of Dunkin' Donuts
1955
William Rosenberg began to sell Dunkin' Donuts as a franchise to other entrepreneurs. This was
the first step in the company's popularization
Globalization of Dunkin' Donuts
1965
Dunkin' Donuts began to spread to other countries around the world, marking its first step in
globalization.
The Advent Of The Famous "Munchkins"
1972
Dunkin' Donuts adds their famous copyrighted "Munchkins" product to their menu.
Addition of Breakfast Sandwiches
1997
Because of the increase in sales from the Munchkins and other donuts, Dunkin' Donuts expanded
on its menu by adding breakfast sandwiches to it.
Adoption of Technology
2012
Dunkin' Donuts capitalizes on the increasing success of technology (especially smartphones) and
creates its first mobile application that allows it to take a different marketing stance in the food
industry.
Success by 2014
2014
By the year 2014, Dunkin' Donuts has expanded its operations into 33 countries worldwide and
operates in a total of 11,000 restaurants. Additionally, it has over a 1,000 items in its menu.
Controversial Issue
Dunkin' Donuts has apologised after it ran an advertisement in Thailand featuring a woman in
"blackface" make-up. The advert, which was used to promote the donut giant's "charcoal donut",
was called "bizarre and racist" by a leading human rights group.
Dunkin' Donuts chief executive in Thailand defended the campaign, but a spokesman for
Dunkin' Brands told the Guardian on Friday it would immediately pull a planned television spot
featuring the imagery.
"Dunkin' Donuts recognizes the insensitivity of this spot and on behalf of our Thailand
franchisee and our company, we apologize for any offense it caused," Karen Raskopf, chief
communications officer for Dunkin' Brands, said in a statement provided to the Guardian. "We
are working with our franchisee to immediately pull the television spot and to change the
campaign."
The Thai arm of Dunkin' Donuts had planned a poster and television campaign around the
image, which it shared on Facebook. The advert shows a woman apparently wearing dark make-
up and bright pink lipstick, with a 1950s beehive hairstyle. She is holding a "charcoal donut", out
of which a bite has been taken. The slogan next to the image reads: "Break every rule of
deliciousness."
The advert caused consternation on Friday morning, after Human Rights Watch said it would
cause "howls of outrage" if it ran in the US.
"It's both bizarre and racist that Dunkin' Donuts thinks that it must color a woman's skin black
and accentuate her lips with bright pink lipstick to sell a chocolate doughnut," said Phil
Robertson, the deputy Asia director for HRW. "Dunkin' Donuts should immediately withdraw
this ad, publicly apologize to those it's offended and ensure this never happens again."
The CEO for Dunkin' Donuts in Thailand, which is operated as a franchise, was initially bullish
about the marketing. "It's absolutely ridiculous," said Nadim Salhani. "We're not allowed to use
black to promote our doughnuts? I don't get it. What's the big fuss? What if the product was
white and I painted someone white, would that be racist?"
Salhani said his daughter was the model used in the advert. He dismissed criticism as "paranoid
American thinking", saying: "I'm sorry, but this is a marketing campaign and it's working very
well for us."
The Associated Press reported that the advert had not "ruffled many in Thailand, where it's
common for advertisements to inexplicably use racial stereotypes". The news agency said a
herbal Thai toothpaste was available with the tagline "it's black, but it's good", while advertising
for the Black Man brand of household mops showed a "smiling black man in a tuxedo and bow
tie".
Why did they remove the second name?
ICYMI, earlier this week, Dunkin' Donuts shed its last name and became Dunkin'. Just Dunkin'.
Some people took issue with the change, while others said, "I've been calling it Dunkin'
forever..." and moved on with their lives. Regardless of which camp you fall in, the reason
behind the change is actually pretty interesting.
On a phone call with reporters Tuesday, Dunkin' Brands CEO David Hoffmann noted two big
reasons for the change, per Business Insider. The first: An increased emphasis on drinks. Yes,
the donuts are staying, but Dunkin' is focusing more on coffee as Americans are eating healthier
and coffee has a higher profit margin than donuts.
"For two years, we have been focused on evolving Dunkin' into the premier, beverage-led, on-the
go-brand and have been implementing what we call our blueprint for growth," David said.
New Dunkin' stores will have a cold drink tap that looks like what you'd see at a bar. David also
mentioned expanding their tea selection as well as "other categories that we, as a beverage-led
brand, need to get into and will get into."
The other big reason by the change: simplifying the brand as a whole. "The simplicity of our new
brand creates energy," Dunkin' Donuts' US CMO Tony Weisman said.
Earlier this year, Dunkin' cut 10 menu items from stores, and last fall, they shrunk the donut
variety. The shorter name reflects the a more streamlined concept. "Dunkin' is a shorter, simpler,
more modern version of who we've always been," Tony said.
Problems they encounter and their solution
TheStreet: You guys really got analysts in a huff on the earnings call with this new menu
streamlining initiative. Why are you doing this?
Travis: When you do a big piece of consumer research like we did last year, you learn a lot. We
learned that one of the biggest strengths we have is speed, which confirmed that we are a to-go
brand. What we also learned is that we have a menu that has thousands of combinations of
sandwiches, thousands of combinations of drinks and that we have more stock keeping units
(SKUs) than some of our competitors like Starbucks and McDonald's. So that told us we may not
always get the credit for this complexity.
So, we want to streamline our menu. We have done small tests on this already. We will do this
across a variety of markets. It's important. We are determined to build quicker throughput and
improve service.
Our biggest problem is finding labor, and some of the things we have learned is that our system
is pretty complicated to learn. If we can simplify it, it will be better for our employees. They will
like working at Dunkin' more than they already do and we can retain people in a very tough labor
market. So, we have a lot of stuff on the menu and we probably don't need it all.
TheStreet: Is doing this one way to reduce labor in the store?
Travis: I wouldn't look at it that way. We have encouraged our franchisees not to look at it that
way. This initiative is not about labor cutting. This is about using labor more efficiently. A
couple earnings calls ago we talked about that 30% of our labor comes from taking the order. So,
if we can do that in a better, less stressed manner that's better for the customer and better for the
employee. Also, remember that 70% of our sales go through the drive-thru in stores that have
them. There is a short period of time to get that order done. Anything we can do to speed up our
transactions is good.
The thing that actually slows down the drive-thru is when people ask for donuts and want them
put into a box. If we can speed all of this up, it will be a huge benefit.
TheStreet: You also seemed to surprise some analysts on slowing down the pace of development
a bit in the U.S. Is this a reflection of the build-up in regulations and higher minimum wages in
recent years finally taking a toll on franchisees?
Travis: I think this reflects a lot of things. The actions taken in New York and California to raise
the minimum wage to $15 an hour probably weighed on it. Franchisees are concerned about
finding labor and the money they have to pay. Clearly, franchisees haven't seen the same-store
sales increases. Their profit margins are still good. Last year was the second highest year ever for
franchisee margins, but they are a bit cautious. So, there may be a couple years of build up here.
But I will say there is a good chance we could beat 385 new openings this year. I'm optimistic.
Clearly, if we can get some help with corporate tax reform, and labor and less regulations it
would be welcome.
TheStreet: Starbucks clearly is having issues with long lines and possibly, upset customers. Are
you doing anything to target these potentially disenchanted customers? It seems like a good
opportunity to take some business.
Travis: I think targeting is an overstatement. Look, we are doing everything we can to speed up
our transactions. I have gone into competitor stores and waited a long time. I never really wait
anytime I walk into Dunkin' no matter how complicated the menu is. We can make our
experience better by streamlining our menu. But, the fact that we have so many drive-thrus and
we are working to make them more efficient is a real asset. Mobile ordering helps, too.
So I don't think we have to go out and target Starbucks customers or anyone else's. But, I did find
their news interesting. It told me that we are moving in the right direction.
