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Going Crazy for Krispy Kreme

26/07/2020


Like many brands adapting their offers to the challenges of Covid-19, Krispy Kreme’s US stores has been running tailored promotions for customers throughout 2020, most recently a generous “graduation giveaway” designed to connect with senior students who were denied the opportunity to don a cap and gown and enjoy a formal graduation ceremony. The promotion simply consisted of a box of a dozen graduation-themed doughnuts available free of charge on one promotional day for students who visited Krispy Kreme stores in their graduation cap and gown – a simple concept which unexpectedly caused traffic chaos in one store in Long Beach California, with tailbacks extending over three blocks.

While perhaps an isolated result for a promotion in the United States, the headline reminded me of the even more incredible story when Krispy Kreme opened it’s first and only Irish store in Dublin in late 2018 which resulted in a complete customer “frenzy”, causing the Washington Post to wonder if we’d ever actually “seen a doughnut“. Opening hours had to be curtailed to respond to noise complaints in the neighbourhood throughout the night, but despite the reduction in trading time, the store has continued its extraordinary success, becoming Krispy Kreme’s most profitable store worldwide. No real explanation has yet emerged for the impact of Krispy Kreme’s doughnuts with Irish consumers, yet it is undoubtedly an amazing case study for this brand whose goal is to become “the most loved sweet treat brand in the world” despite the many business challenges it has survived in its eighty year history.

As always, our goal is to explore marketing and loyalty insights from global brands, with Krispy Kreme offering some unique concepts and ideas.

Graduation-themed treats from Krispy Kreme 

Growth & Focus

In early 2020, Krispy Kreme announced exciting plans to expand its US footprint with six new stores in New York city including a 4,500 square foot flagship store in Times Square that will serve its iconic doughnuts 24/7. Despite the country’s stated intention to eat healthier food, it’s clear that there is still an important place for indulgent treats in the American diet, so Krispy Kreme’s glazed doughnuts are likely to remain as popular as ever once normal retail operations resume.

And it seems that one key success factor is driving sales in its stores – the simple yet effective “hot light” sign that lights up when fresh doughnuts are available direct from the oven. This feature is so popular in fact that a dedicated digital app was initially built for it back in 2011, but thankfully this is now part of the main Krispy Kreme app, and remains “wildly popular” with fans.

The hot light remains a USP – announcing fresh hot doughnuts for customers.

Sweet Rewards Programme

Launched in 2015, the Krispy Kreme “My Sweet Rewards” programme is focused on four different “tracks” to reflect its product mix of doughnuts and coffee. Heres how it works:

  1. Customers download the app and receive one free doughnut for joining as well as access to local offers and rewards.
  2. Each purchase earns a credit against one of the four product lines known as “tracks” – single doughnuts, coffees, speciality coffee, or doughnuts by the dozen.
  3. Twelve credits on any track earns a free reward.
  4. Rewards are valid for 90 days and are automatically redeemed the next time the member comes to purchase.

Digital Driving Growth:

While all major brands have developed a clear digital strategy, many become exclusively focused on the response rate they can measure from investment in search traffic and banner campaigns, yet they often miss the added value that social media brings, particularly if the strategy is fun and engaging for customers.

Krispy Kreme Australia’s CMO commented that “we also found the more we did digitally to innovate, the better it did as a brand“, an important metric yet often missed (or under-valued) as it’s harder to measure than simply brand impressions. Even in the US, Chief Marketing Officer Dwayne Chambers suggests that the biggest challenge is measuring “passion” – a key ingredient to create customer loyalty.

Simplest Strategy

Having survived plenty of challenges in its corporate history, it seems that Krispy Kreme’s is adopting a more careful and considered plan for growth. Its laser-focus on truly delicious doughnuts continues to delight customers who describe them as  “addictively good“. Its latest promotion amidst Covid-19 features an extension from doughnut day to doughnut week, relying on product sampling as the first essential step to find new loyal fans.

With its main competitor Dunkin’, focused on positioning itself as a beverage-led brand, now may be the perfect time for Krispy Kreme to leverage its tasty treats and simple strategy to become the global leader in delicious doughnuts.

About Us:

Liquid Barcodes is a leading global loyalty and digital marketing technology company specialising in the convenience store and foodservice industries. Our proprietary cloud-based technology platform allow retailers to create and manage their digital marketing campaigns with a proprietary process we call the “customer connection cycle’ to engage, promote and reward customers activities in real-time across digital and media channels.

How we do it:

We have developed the most advanced loyalty and digital marketing technology platform specifically for convenience store and foodservice retailers globally.

Retailers use our self-service dashboard to create and manage loyalty driven marketing campaigns that increase purchases with their existing customers, as well as effectively target and acquire new customers through partners or paid media channels.

One core component of live loyalty is gamification. We have gamified branding, loyalty and promotions. We believe this approach is essential in order to get customers’ attention and ultimately truly engage them with repeatable actions thereby winning their loyalty.

Check out some of our exciting/proven results here:

www.LiquidBarcodes.com

About Me:

Paula Thomas

Chief Content Officer, Liquid Barcodes and Independent Loyalty Consultant

With over twenty-five years marketing experience, I specialise in loyalty marketing consulting, managing consumer loyalty propositions, strategy and operations. In addition to working with Liquid Barcodes, my clients have included Telefonica O2 Priority, Three Mobile, Electric Ireland, Allied Irish Bank and The Entertainer Group (UAE), as well as Avios – the global points currency for some of the world’s top airlines. I am also a former judge for the Loyalty Magazine Awardsand host of the “Let’s Talk Loyalty” podcast.

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