Dunkin' Donuts Case Study
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Dunkin’ Donuts is a worldwide doughnut and coffee company, established in the U.S. Since its foundation, the company has grown into one of the biggest coffee and baked goods chains in the world. The business has planned a thorough marketing strategy in order to succeed. It has an ambitious expansion drive in the long term (Civi, 2013). The company anticipates launching new style outlets ranging from five thousand to fifteen thousand before the year 2050. Also, it has formed partnership with Procter and Gamble, the second leading retail coffee producer in the U.S. The approach enables the company to compete against it rivals in the market effectively.
The company has established new upmarket blends of espresso based coffee and seasonal coffees to attract new customers. The new line of beverages accounts for more than five percent of the company sales. Also, the company has tried to apply similar marketing models to those used by its rival Starbucks (Krishna, 2014). The strategy emphasizes on the outlets rather than the product itself. It has improved its stores by creating nice environment for relaxation, putting in place sleeker versions of chair and tables and piping the area with music and WIFI access. Also, the company’s online marketing campaign in YouTube has enabled it to get new customers and be efficacious.
Dunkin’ has various strengths that help it fit well in the market. It has strong geographic coverage, variety legedary products and strong loyalty. Offering new coffee products made it possible for the the company to present a more upscale image (Tu, Wang & Chang, 2012). Such strengths have enabled the company to have roots in the largest economic markets in the world. However, Dunkin has got some drawbacks. The current layout of cafeterias shows there is no possibility for the firm to grow in the Northeast, where the majority of its transactions come from. It is also not a traditional premium brand. Therefore, to attract customer it has to advertise and put in place effective marketing strategies that will enable it to compete with traditional coffee companies.
The recent status of Dunkin is that it has established efforts to enhance the image of its coffee as a premium product. The marketing strategies made it one of the leading businesses in the coffee industry.
Dunkin Donuts Company had several opportunities. By the mid-2000, there was a rise in the coffee shop business, and the company had the opportunity to introduce various coffee brands into the market. The company was aware of the growing reputation and the customers’ enthusiasm to spend on quality goods. They thus speeded the move to become a first-class coffee chain by employing new market strategies. Popular health topics were also a great opportunity for the company to expand into the coffee business. Research showed that obesity was very prevalent at that time due to high-fat foods, and the company was in a better position to vventure into the coffee business. The greatest threat that this company faces is competition. Starbucks is the major competitor as it has established itself well and developed customer loyalty (Tu, Wang & Chang, 2012). The overpowering nature of having a store on every street corner has ruined the market.
Customer relationship management is one strategy that works well for the Dunkin Donuts (Civi, 2013). The company has made their stores more comfortable place for the customers by coating tables and chairs, providing good music and enhancing an internet access. Advertising has also proved to be successful. The company has commenced an online marketing strategy by launching its YouTube channel. The customers have intermingled on a more personal level with their favorite brands while the company has established emotional connection with the customers. The different product lines have given the customers a wide variety of products to choose from by incorporating the needs of all the customers (Civi, 2013).
The aspect of competition with Starbucks and other retailers has been a great challenge for the company (Krishna, 2014). The fact that there are so many outlets offering the same products forced Dunkin’s to place its coffee in mass merchandisers hoping to reach out to many customers. They have also improved their brands to compete in the market. Other businesses should emulate such marketing strategies to enhance proper competition and business success (Krishna, 2014).
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