Sunteți pe pagina 1din 8

Fall

Krispy Kreme Rebranding Proposal


Marcie Pagel
Fundamental Rebranding Proposal for Krispy Kreme Doughnuts

Krispy Kreme Doughnuts

14

Table of Contents
Executive Summary

Statement on the State of the Brand

3-4

Proposal

4-8

Statement of the Problem

Statement of the Proposed Solutions

6-7

Tasks and Tools

Statement of Novelty

Works Cited

1. Executive Summary
Over a decade ago, Krispy Kreme Doughnuts was known as one of Americas Hottest
Brands. Today, the overall state of the company has diminished, presenting an ideal candidate
for rebranding.

In terms of overcoming problems of competition and times of low sales, several

suggestions will be discussed in this proposal. While Krispy Kreme boasts an iconic logo and
recipe, the company has failed to implement a profitable, long-term strategy. As seen in the
tremendous growth of Starbucks, coffee has become a staple in American and global
consumerism. Thus, Krispy Kreme needs to greater focus on coffee and drinks overall.
Additionally, Krispy Kreme exemplifies the need for a strong advertising campaign. Without an
advertising campaign, a product quickly and easily disappears from the minds of consumers.
Furthermore, other actions for success include doughnut delivery, event catering, and an
expanded product line. However, these are concepts that require further investigation while
coffee and advertising presently denote the prime concerns.
2. Statement on the State of the Brand
Krispy Kreme implements a strategy focused on providing delicious tastes and creating joyful
memories to consumers everywhere. The company currently operates 582 stores in eighteen
different countries around the world and falls under the category of
Figure 1: Krispy
Kreme Store

vertically integrated, which signifies that the firm takes part in


multiple parts of production. In addition to making the doughnuts
fresh each day, the company manufactures their own machinery for
the doughnuts and coffee (John Ellis Group).
Krispy Kreme is known as a cult brand, meaning it has built its

reputation by word-of-mouth and local campaigns instead of advertising. When stores open in

new areas, the company seeks to build excitement by focusing its time and effort in the
community where the store is located. While this promotes same store sales, an indicator of
positive single-store performance, this strategy fails to capture a larger market share. The
absence of advertising causes Krispy Kreme to fade into the background while other companies
forge ahead. In a survey conducted in the United Kingdom in 2010, fourteen percent of
consumers had never heard of Krispy Kreme while fifty percent of consumers had never visited
one (John Ellis Group).
Further, Krispy Kreme faces increasing competition from big names like Starbucks and from
similar companies with like products, namely Dunkin Donuts. Although sales increased by seven
percent this year, many other indicators show that Krispy Kreme will have to make changes to
survive. For instance, recently reported quarterly earnings illuminated that the doughnut
company failed to achieve predicted forecasts ("Krispy Kreme Gives Investors A Toothache").
This has translated into declining stock prices, as stock is now down fourteen percent. In the past
decade, the price of stock has declined from fifty dollars per share to seventeen dollars per share
("Glazed and Confused: Krispy Kreme Stumbles"). The strategies discussed performed well in
the past, but have not left an overall, lasting impression.
Figure 2: Stock Price of Krispy Kreme
(John Ellis Group)

3. Proposal
3.1 Statement of the Problem
3.1A Introduction
Krispy Kreme Doughnuts denotes a recognizable franchise that has faced mounting problems
within the past several years. These problems include: decrease in stock and share value,
increasing expenses, and a lack of credible financial reporting. This combination culminates in
the current predicament, a declining organization that once was known as Americas Hottest
Brand.
3.1B Brand Awareness
In terms of sales and brand awareness, Krispy Kreme has many shortfalls. A survey
conducted in 2010 denotes that fifty four percent of customers only ate at Krispy Kreme one
time per year. Only five percent of those surveyed went to Krispy Kreme once a month while
forty percent ate zero doughnuts in 2010 (John Ellis Group). These statistics suggest a major
issue: consumers are either not excited by doughnuts or a lack of advertising has caused the
product to be disregarded. Judging by the sales at competitors like Starbucks and Dunkin Donuts,
it must be the latter.
3.1C Competitors
As competitors have grown and taken large parts of the market, Krispy Kreme has suffered.
The high concentration of Starbucks and strong brand awareness translates into large revenues
and sound operating profit. Because Starbucks serves pastries as well, it offers products that
directly challenge with Krispy Kreme. In addition to Starbucks, Dunkin Donuts poses a
significant threat to Krispy Kreme because these companies market the exact same products.

Dunkin Donuts is well known for its coffee and also operates on a much larger scale than Krispy
Kreme. With 11,000 stores operating in thirty-three different countries, in comparison to Krispy
Kremes 582, Dunkin Donuts is considered one of the largest baked good chains in the world.
3.2 Statement of the Proposed Solution
The problems previously discussed in this report highlight a need for change to save this dying
brand. The following propositions provide direction for rebranding and strive to achieve better
results.
3.2A Coffee Products
According to Business Insider, eighty-three percent of Americans drink coffee, which
translates into coffee being a thirty billion dollar-a- year industry (Goldschein). It is an essential
time for Krispy Kreme to largely focus on coffee and satisfy the wants of todays consumers. A
signature yet affordable coffee product, possibly a line of drinks mochas- or a product unique
to Krispy Kreme a special Frappuccino, would enable Krispy Kreme to rival other morning
breakfast places and thus increase revenues on doughnuts as well. Additionally, as sales drop
during the winter, an affordable spiced latte and specialty doughnut combo could be the
difference in a customer wanting to visit Krispy Kreme and opting to go to Starbucks.
3.2B Need for Advertising
The central focus on cult branding has left Krispy Kreme weak in overall brand awareness,
taking a toll on profit results. The time has come for Krispy Kreme to adopt a strong advertising
campaign. This entails more than the current website and social media accounts. Consumers
need to be drawn towards Krispy Kreme; perhaps by seeing a Krispy Kreme commercial,
individuals will be craving a doughnut. Free samples as well as holiday events in stores could
potentially draw new consumers into the store for the first time. This evolves into repeat

customers and finally brand loyalty. The rebranding process would begin with online
advertisements on Netflix, Twitter, and Instagram and progress to national commercials.
Marketing to communities nearest to Krispy Kreme locations becomes pivotal as consumers
value convenience and instant gratification.
3.3C Additional Propositions
Doughnut delivery serves as another proposition for rectifying the decrease in sales during the
winter season. While there would need to be parameters and boundaries, doughnut delivery
would be the first of its kind and this differentiation could potentially increase market share.
Doughnut tower cakes, donut sandwiches, gluten free doughnuts, and low calorie choices could
also be pivotal in returning this brand to prominence.
Though they require further market research, these concepts convey the possibilities and
potential growth for this company. Conclusively, these propositions provide options for
remedying the current climate at Krispy Kreme and for increasing overall market share.
3.3 Tasks and Tools
To begin this rebranding process, it becomes vital to confirm such changes are feasible. Time
and money denote the most prominent concerns. In terms of creating new products, chefs and
food designers must take the time to create and test recipes. The most expensive and timeconsuming of these proposals refers to the advertising campaign. Although it requires numerous
resources, such as hiring a Marketing company, filming promotions and designing online
materials, the advertising campaign potentially captures the most attention. Thus, the advertising
campaign denotes the most pivotal change. To implement these changes and achieve results, the
timeline spans two to three years, as developing the right coffee mix requires market research
and experimentation.

3.4 Statement of Novelty


A proposal for rebranding is necessary because Krispy Kreme fails to live up to its full
potential. This company has thrived in the past and a future awaits it but only if there is a focus
on future and long-term growth. This proposal consists of the best ideas because these concepts
originated from loyal customers and embody the changes they wish to see manifested. Also,
these concepts are inventive while keeping true to the company. Thorough market research
suggests these ideas present the best solutions; consumers appreciate coffee, convenience, and
commercials. These solutions entail a greater focus on advertisement through television and
other mediums. Additionally, expansionary plans provide channels to increase brand awareness
and overall market share. Lastly, an expansive coffee line would acquire new customers while
keeping the old customers happy. Building a loyal customer base will enable Krispy Kreme to
ultimately reach its profit- earning potential.
4. Works Cited
"Glazed and Confused: Krispy Kreme Stumbles." CNNMoney. Cable News Network, 7 Sept.
2014. Web. 15 Sept. 2014.
Goldschein, Eric. "11 Incredible Facts About The Global Coffee Industry." Business Insider.
Business Insider, Inc, 14 Nov. 2011. Web. 15 Sept. 2014.
John Ellis Group. Krispy Kreme Turnaround Strategy. Strategy Coursework, n.d. Web. 10
Sept. 2014.
"Krispy Kreme Gives Investors A Toothache After Missing Earnings Estimates And Lowering
Guidance." Forbes. Forbes Magazine, n.d. Web. 9 Sept. 2014.
"NEW YORK: US Stocks Drift at Midday; Krispy Kreme Sinks - Business Breaking News MiamiHerald.com." The Miami Herald. N.p., n.d. Web. 8 Sept. 2014.

S-ar putea să vă placă și