New store concept is next step in Dunkin’ rebranding

Discussion
Photo: Dunkin' Donuts
Jan 24, 2018
Matthew Stern

Dunkin’ Donuts is continuing along its path to a new look and feel with a new concept store.

Located in Quincy, Massachusetts, the store has such new features as a dedicated space for mobile order pickups, digital ordering kiosks and a drive-thru dedicated to customers who have ordered ahead via Dunkin’ Donuts’ DD Perks app, according to CNBC. It is also the second store location to feature the chain’s new branding, with only the “Dunkin'” part of the moniker appearing on the signage. The chain plans to open 30 next-gen concept stores in the coming year.

Since 2016, Dunkin’ has undertaken a concerted effort to make its brand known for coffee drinks rather than doughnuts, a rebranding that would put the chain more directly in competition with Starbucks than with doughnut shop chains like Krispy Kreme. But given the extreme brand loyalty of Starbucks fans and the success the coffee giant has experienced with technology like app-based ordering, Dunkin’ may need a more modern, tech-enhanced storefront to mount a challenge.

Better facilitating mobile ordering could be a good place to start. Starbucks’ mobile app has grown so popular that in 2017 customers began to experience significant bottlenecks when picking up their mobile orders. The problem was so significant that the chain began testing a mobile order-only store concept to explore if that would streamline the process.

Dunkin’s coffee competitors in the QSR space have also rolled out improved store technology. In 2016, McDonald’s locations began implementing features like touch screen kiosks, table service and build-a-burger-style ordering to compete with popular fast casual chains.

Dunkin’ has also recently taken steps to streamline its food offerings.

At the beginning of 2018, Dunkin’ Donuts removed 10 items from its menu, Boston.com reported. The items removed included some lower-performing breakfast items like the Angus Steak and Egg Breakfast Sandwich, and lunch items like the Turkey, Bacon and Cheddar Sandwich. Dunkin’ Donuts framed the menu revamp as an attempt to improve customer service and increase the consistence of the store experience. 

DISCUSSION QUESTIONS: Will a new store concept with upgraded features like a mobile ordering-only drive-thru make Dunkin’ Donuts more competitive with Starbucks? Is Dunkin’ making a mistake by trying to move upmarket?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"Customers have a host of new ways to interact with brands, and the smartest stores will give them options beyond waiting at the counter."
"Will it make Dunkin’ more competitive? Perhaps. But it certainly doesn’t make Dunkin’ less competitive."
"I’ve always felt that Dunkin’ had a great opportunity to be the ‘anti-Starbucks’ in terms of how it went to market."

Join the Discussion!

27 Comments on "New store concept is next step in Dunkin’ rebranding"


Sort by:   newest | oldest | most voted
Dr. Stephen Needel
BrainTrust

I’m not sure this is an upmarket move as much as it is a recognition that people are interacting in a new way. I don’t think it will make Dunkin’ Donuts more competitive with Starbucks, but it is one more thing to give customers the type of experience they may want. Personally, I can walk in and get my two jelly donuts and hand the clerk $2, but I’m not sure my kid can.

Cathy Hotka
BrainTrust

I agree completely. Customers have a host of new ways to interact with brands, and the smartest stores will give them options beyond waiting at the counter.

Art Suriano
BrainTrust

I think Dunkin’ Donuts is smart to update their store concept realizing that many trends have changed, and they need to keep up with consumer demand for healthier products and more technology for conveniences. However, I don’t see the name change as being that important, and I doubt most customers will even notice. Books-A-Million changed their store signs to BAM and it caused a lot of confusion. But customers still refer to them as Books-A-Million and the shopping experience is still the same regardless of the name change. Dunkin’ Donuts or Dunkin’ need to focus more on what they can offer customers that will make them different from competitors and they need to base those changes on what their customers want. It’s essential that they keep up with the times to stay in the game.

Joy Chen
BrainTrust

I completely agree. Dunkin’ needs to provide a unique story or positioning against the competition in order to win in this marketplace.

Michael La Kier
BrainTrust

Upgrading technology and the user experience is the right way to go, but that does not mean the brand needs to move away from its core DNA. Dunkin’ needs Donuts. Moving too far from that — whether the technology is present or not — is a mistake.

Ian Percy
BrainTrust

EXACTLY Michael! Not only does it need donuts — it needs good donuts. Everything else is a distraction.

Peter Charness
BrainTrust

Tech does not make a store upmarket, it makes it more convenient to shop at, and probably more of a draw for younger shoppers. The Dunkin’ and Starbucks experiences are pretty different. I wonder if the “lunch” crowd is more up for grabs than trying to break customers’ “Starbucks first thing in the morning” habit.

Neil Saunders
BrainTrust

I think this move puts Dunkin’ more in line with consumer trends and competitors. The issue is that Dunkin’ needs to pull customers away from rivals to succeed. Even with these changes that’s a tough task!

It’s all very well to want to be known for more than doughnuts but, given the saturation in the market, coffee isn’t exactly the most differentiated of products! Nor do the other changes put Dunkin’ on the cutting edge of retail!

Lee Peterson
BrainTrust

I’ve always felt that Dunkin’ had a great opportunity to be the ‘anti-Starbucks’ in terms of how it went to market. Sort of the blue collar coffee brand. Think of how easy it would be to poke holes in the coffee culture created by the urban-based green brand. But unfortunately there’s no sign of that yet. Just more pink and orange.

And aside from that, I agree with Dr. Needel in that this prototype looks to be more of an accommodation to the way people buy now rather than any kind of shift in market target. If it’s not true already, Dunkin’ Donuts might just wind up as a regional brand defense for New Englanders fed up with the green logo from the West’s invasion and nothing more. So much potential lost, in my opinion.

Meaghan Brophy
BrainTrust
Meaghan Brophy
Senior Retail Writer
1 year 9 months ago

Overall I like the new store concept. Having the cold beverages “on tap” is a nice touch. It seems like Dunkin’ is trying to make the customer experience simpler and speedier, which is very important when it comes to breakfast and coffee. I’m all for their upgrades as long as it doesn’t come with higher prices. Dunkin’ needs to maintain a lower price point than other chains to stay competitive.

Ian Percy
BrainTrust

It’s the DONUTS, stupid!

It’s amazing how we try to do everything but deal with the real problem. No one is saying “I’d go to Dunkin’ Donuts more often if they’d have a new store concept.” The donuts … the actual donuts … are increasingly small, more costly and very ordinary. The coffee is very ordinary too. With my Canadian heritage and a tendency to genuflect when I see a Tim Hortons, I’ve got to say they have the same problem. When you produce a product people love and that becomes a destination, you can sell it out of a shed.

For several years I had a place in Puerto Penasco, Mexico. One of the joys was a single location convenience store that made apple fritters and other delights that I’d drive four hours from Scottsdale to get. I’ve paused just thinking about them. There is no chance that Dunkin’ Donuts will ever reach that height.

Ryan Mathews
BrainTrust

Good point Ian. First let me say all the customer-focused technology is great. But it doesn’t matter much if there are no customers. It’s unlikely that Dunkin’ is going to out-coffee Starbucks, or out-breakfast McDonald’s. So that leaves them with … um … yes … doughnuts! Even the name change is silly. What in fact does “Dunkin'” mean once you try to downplay the Donut? Of course this positioning does put them squarely in the Krispy Kreme crosshairs and — in sophisticated markets like Detroit for example that are early and eager adopters of Canadian cuisine — in direct competition with Tim Hortons. And yes, I think you could have some branding fun as others have suggested positioning Dunkin’ Donuts as the anti-hipster, blue collar alternative to the lattéd legions searching for that perfect mix of coconut foam and gerbil essence, served at exactly 103.753 degrees.

So, full marks for carrying the doughnut torch! Too bad Dunkin’ is busy trying to be something it isn’t.

Bob Amster
BrainTrust

From the perspective that Dunkin’ Donuts does compete with Starbucks to a large extent, and the demographics of the consumer are changing for everyone, Dunkin’ Donuts is making the right moves. It is not so much about moving upmarket as it appears to be an effort to move in the direction toward which their consumer of tomorrow is moving. Wait and see …

Steve Montgomery
BrainTrust

I believe this is more an update than an upmarket move by Dunkin’. It includes moves that others such as Starbucks have already done. Dunkin’ is playing catch-up and is wise to do so. Better late than too late.

Will it make Dunkin’ more competitive? Perhaps. But it certainly doesn’t make Dunkin’ less competitive.

Jasmine Glasheen
BrainTrust

It’s true that Dunkin’ did a great job of convincing customers that their coffee is high quality. Not to segment myself too much here, but I’ve tasted Dunkin’ coffee and would argue that the only competition it offers is to Folgers.

Now as far as Dunkin’s moving upmarket… as Matthew mentioned, even McDonald’s is implementing new tech and serving methods to maintain customer interest in a new era. Until they start raising the price points on their coffee and putting out trendy video ads, I don’t think Starbucks has anything to worry about from Dunkin’.

With all of this said, I think Starbucks faces a very real threat from local coffee roasters which can offer customers a unique and specialty experience.

Lee Peterson
BrainTrust

Folgers comparison: good one!

Scott Norris
Guest

I’ve made the mistake of ordering Dunkin’ coffee at airport locations twice. Too hot to drink before boarding, flavorless, had to toss out. Cold beverages, fine, but only if there’s no other nearby alternative.

Kwan Lee
Guest
1 year 9 months ago

Mobile apps don’t work at the airport either.

Max Goldberg
Guest

I don’t think the changes Dunkin’ is making mean that the chain is trying to go upscale. Rather, it seems to be an effort to adapt to customer technology preferences to stay relevant.

Lesley Everett
Guest

It’s great that they are trying to meet the current day needs and expectations of their customers. Of course it will only work if the technology and process operates smoothly, and the customer experience is good and the product retains consistency. Like any new process, it’s the basics that really count.

Ken Cassar
BrainTrust
Ken Cassar
Vice President, Research, Shoptalk
1 year 9 months ago

In my neck of the woods (halfway between Boston and New York) Dunkin’ Donuts shops are so close together that they ought to share parking lots. Despite that, lines are inevitable during the morning rush. I see Dunkin’s moves as a smart move to drive more yield from existing locations, leveraging digital: Put another way, it’s got more to do with improved customer experience than trying to move upmarket.

Richard J. George, Ph.D.
BrainTrust

It always difficult to go upmarket. You can make it with class or make it for the mass but you can’t do both. However, Dunkin’ has been gradually making the transition in terms of better offerings and now a more inclusive name. Plus, I like its focus on mobile ordering and pick up. I believe these changes, in combination, give them a chance to positively move upmarket.

Terry Lugo
Guest

I think these changes are a great for the brand. At least Dunkin’ is trying to stay on top of the ever-changing market. I know personally, at least here in CT and the New England region, sometimes there isn’t a choice other than Dunkin’. They are as abundant here as Starbucks are on the West Coast! So … happy to see they are trying to move upmarket.

Craig Sundstrom
Guest

Much like Target vs. Walmart, or Mac vs. PC, this seems, to me at least, one of those competitions that says as much about culture as anything else (Dunkin’, of course being the Eastern/blue collar staple while Starbucks is the Western/”hip” one). How much this perception equates to reality I can’t say, of course — and it’s likely less than 100% — but I still don’t see it making much difference … one of those “can’t hurt, might help” upgrades.

Ricardo Belmar
BrainTrust

Like every foodservice brand, Dunkin’ is modernizing their in-store experience vis technology. This doesn’t necessarily imply a move upmarket, nor is it a direct swipe at Starbucks. Dunkin’s core customers are different than Starbucks in most regions and this is their way of adding more value, reducing friction, and improving the overall experience. The net result should be happy customers that maintain loyalty and come back to Dunkin’ more often. If they take customers away from Starbucks, that’s a bonus.

At the end of the day, people have a preference for coffee and adding tech-based conveniences won’t move the needle on that. However, Dunkin’ may take customers away from other local coffee shops and from other QSR brands instead with the added conveniences, they’re adding to these new concept stores!

Shep Hyken
BrainTrust

Dunkin’ Donuts recognizes that they must keep up with the times. This isn’t an upgrade or a move to a new marketing. This is just about staying competitive. They have a great product (coffee and donuts), which is what “got them to the dance,” and they aren’t messing with that. They can add items, add technology, upgrade their look, but they know better than to mess around with what has made them a success.

Min-Jee Hwang
Guest

Dunkin’ is on the right path with this new store concept. Any retailer that takes a look at their data and makes changes to give customers more of what they want is doing the right thing. Dunkin’ is smart to invest in this now, because mobile has fully taken over. It’s better to do this now, compared to being left in the dust after trying to make an old selling concept work when times have completely changed. This move shows that Dunkin’ wants to stay relevant and shift their business to better meet customer needs.

wpDiscuz
Braintrust
"Customers have a host of new ways to interact with brands, and the smartest stores will give them options beyond waiting at the counter."
"Will it make Dunkin’ more competitive? Perhaps. But it certainly doesn’t make Dunkin’ less competitive."
"I’ve always felt that Dunkin’ had a great opportunity to be the ‘anti-Starbucks’ in terms of how it went to market."

Take Our Instant Poll

How likely is Dunkin's new store concept to make the chain more competitive with Starbucks?

View Results

Loading ... Loading ...