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April 08, 2006

Hey Dunkin’ … Accentuate the Hate!

Dunkin_2
”Dunkin' Donuts last year paid dozens of faithful customers in Phoenix, Chicago and Charlotte, N.C., $100 a week to buy coffee at Starbucks instead. At the same time, the no-frills coffee chain paid Starbucks customers to make the opposite switch.

When it later debriefed the two groups, Dunkin' says it found them so polarized that company researchers dubbed them "tribes" -- each of whom loathed the very things that made the other tribe loyal to their coffee shop. Dunkin' fans viewed Starbucks as pretentious and trendy, while Starbucks loyalists saw Dunkin' as austere and unoriginal.

‘I don't get it,’ one Dunkin' regular told researchers after visiting Starbucks. ‘If I want to sit on a couch, I stay at home.’” [SOURCE: Wall Street Journal article (sub req’d)]


Armed with this research, Dunkin’ is in the beginning stages of remaking its nearly 5,000 U.S. stores to be more like Starbucks without feeling like Starbucks. Huh? Is that even possible to be similar yet dissimilar at the same time? Given the research findings, why isn’t Dunkin’ accentuating the differences rather than blurring the differences between the two?

Take a look at the new prototype Dunkin’ Donuts … sure does resemble a typical Starbucks, right?

Dunkin_1

In addition to the new pastry case displays and granite-like countertops, Dunkin’ is also taking a page from the Starbucks playbook and playing music in its stores where previously it didn’t. While there will not be comfy chairs in the remodeled Dunkin’, there will be upscale sandwiches with a decidedly downscale name. Feedback from Dunkin’ customers was that “Panini” was too fancy a name to call a hot sandwich so instead, Dunkin’ will call this menu offering a “stuffed melt.”

And get this … Dunkin’ marketers are considering ways to allow its customers to text message their orders in. Wait! If “Panini” was too fanciful a name for Dunkin’ Donuts’ working-class customers to call a hot sandwich, then why would Dunkin’ marketers even bother with fanciful text messaging ordering ploys?

Furthermore, according to this Wall Street Journal article, internal Dunkin’ Donuts research also revealed just how uncomfortable Dunkin’ customers were inside Starbucks. Seems as though loyal Dunkin’ customers didn’t enjoy the atmosphere, didn’t like all the laptop-using customers hogging the tables, didn’t appreciate the tall/grande/venti lingo, and didn’t understand why someone would pay $4 for a cup of coffee.

Conversely, loyal Starbucks customers were just as uncomfortable inside Dunkin’ Donuts. Starbucks customers especially didn’t appreciate when Dunkin’ employees added cream and sugar in their coffee denying them the opportunity to customize their coffee as they desired.

Again I ask … given these research findings, why isn’t Dunkin’ accentuating the differences rather than blurring the differences between the two?

I’m reminded of what Rick Nobles said in a MarketingProfs article,

“If your brand is clearly defined enough to have the power to attract enemies, it also has the power to attract raving fans. And the raving fans of your brand are the ones who return again and again. They're the ones who will tell their friends about you. They're the ones who will wear your logo. They're the ones that almost enjoy the annoyance of your brand-haters and will keep coming back for more.

So don’t fear the hate. Embrace it.”

Dunkin’ you’d be wise to fully embrace the differences that exist between yourself and Starbucks in everything you do. Why risk diluting the Dunkin’ difference by trying to be more like Starbucks? Your current customers want Dunkin’ to be Dunkin.’ So appeal to your raving fans by accentuating the hate. Dig?


Other Brand Autopsy takes on Dunkin’ & Starbucks include:
Lowest Common Coffee Denominator | Nov. 22, 2005
Will Speed Win | Dec. 10, 2004

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Comments

Wow. John, I couldn't agree more. DD should redesign thier stores to look like taxis, only accept cash and make thier tagline "coffee for people that work for a living."

Maybe, just maybe, they have a secret report done by a new marketing guy that says people don't really, really mean what they say and don't really know what they want , so we better just blur the lines and nab both sets of customers.

I'm sure it will work.....NOT !

Sounds like a bad idea to run away your customers by making your store into what they hate and trying to appeal to customers that hate you, by just barely being what they want.

Must be one of them there book learnin' kind of college grads running this marketing dept.

Why granite-like when you can have stainless steel? Why not make the new Dunkin' outlets look like classic American outlets.

I am a younger fellow, but I don't want to sit in some smelly sofa at Starbucks. It doesn't seem sanitary. I want nice booth with vynil cushins built right in.

Any word on what the Dunkin' Donuts soundtrack will be like?

As long as they will still sell me a 24 oz cup of decent coffee for $2.27 (with CT sales tax) I don't really care what the store looks like.

And please Dunkin Donuts people keep calling a large a large.

at least they did something right by killing that "togos" brand... "Dunkin' Deli" makes a lot more sense.

The really funny thing about the Dunkin' Populist vs. Starbucks Elitist war is: Dunkin' Donuts's coffee is more expensive than Starbucks's.

Guess the DD marketing department's mommy never said "just be yourself". As long as DD doesn't burn their coffee and then have the nerve to try and sell it to me I'll keep buying DD.

Just wanted to make sure illustration credit was given where it's due. The illo at the top of this blog post was drawn by Henry Yung and was initially published in a Web exclusive for Fast Company magazine. Neat to see it pop up again!

Another hefty piece of research that proves price sensitivity is fundamental to brand acceptance. Not exactly rocket science.

Love dunkin I pick up everyday. It taste good and a large is a large

The power of marketing differenciation and strategy finds its limits in the power of economics. There is time when a marketing position is the result of astute economics, closing some of the gap with Starbuck may give Dunkin some pricing power which have to be compelling. There are probably a non negligeable quantity of Starbuck customers who may switch if the Dunkin offering offer good coffee and more attractive economics. Dunkin better hurry because McDonald is on the hunt.

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