Dunkin Donuts’ Not Hurting from Coffee Price Wars

Convenience Store News reports The fast-food coffee wars have yet to dent Dunkin Donuts’ bottom line very much, one of the chain’s owners said this week.

Despite efforts by McDonald’s Corp to undercut competitors on price, Dunkin’s market share in coffee is steady and growing, Mark Nunnelly, managing director at Bain Capital, said Monday at the Reuters Private Equity and Hedge Funds Summit in New York.

“The big hurt has not been Dunkin to McDonald’s, or McDonald’s to Dunkin. It’s been Dunkin and McDonald’s to your local fill-in-the-blank convenience store,” he said.

Nunnelly, whose firm is one of three private equity owners of the doughnut chain, said Starbucks Corp. has been hurt the most by the price war and the weak economy, noting that more consumers are trading down from expensive drinks to cheaper plain coffee rather than switching among the various outlets.

“The higher-priced players at $4 or $5 for a latte have obviously had the toughest year through the crisis,” Nunnelly said. “The more accessible price point players like Dunkin and McDonald’s have fared better through that period.”

Read more at: Convenience Store News

Meet the Man Behind Dunkin’ Donuts Delights

Mat Schaffer writes in the Boston Herald that it may only take a few minutes to grab a flatbread sandwich from Dunkin’ Donuts or a soft-serve cone at Baskin-Robbins. But it takes months of tasting and testing before such items become available to the public.

Ask Stan Frankenthaler. Hub foodies remember him from behind the stove at Salamander, the Blue Room and Jasper’s. Since 2005, he’s been director of culinary research and development/executive chef for Dunkin’ Brands.

Frankenthaler oversees a 10,000-square-foot lab with 12 working kitchens at Dunkin’s Canton headquarters. He heads up an 18-person culinary team, divided into four groups: beverages, savory, baking and ice cream.

“I’ve got chefs, food scientists, School of Hard Knocks bakers and people who have dual degrees in culinary and marketing,” he said. “We created the flatbread sandwiches, the egg white (omelet), we did a lot of the DDSmart items – took all the flavored cream cheeses to reduced fat, created the multigrain bagel. We did smoothies, we did Trop(icana Orange) Coolatta.”

On the Baskin-Robbins side, Frankenthaler introduced soft-serve ice cream, “Magic Sprinkles” that turn a different color when you lick them and new flavors like Oreo Outrageous.

“It’s essentially a deconstructed Oreo cookie expressed in ice cream,” he explained. “The cocoa ice cream is the wafer of the cookie and the swirl or ribbon is the cream center.”

Frankenthaler also supervised the removal of trans fats from all Dunkin’ Brands products.

Behind a padlocked partition in the lab, members of the culinary team develop menu items that may or may not appear in your local Dunkin’ Donuts or Baskin-Robbins.

“We tinker with it and tinker with it until we get it just right,” Frankenthaler said. “And then we have to put some science into it so that we can repeat that in the 7,000 stores. What’s the Brix (the dissolved sugar-to-water mass ratio of a liquid)? What’re the total dissolve solids? What are all these different attributes that you can then take to turn a recipe into a formula?”

“If we can get you to pause for just one second and say, ‘Wow, that tastes great!,’ we’ve really done what we set out to do.”

JM Smucker Q3 beats Street, signs Green Mountain deal

Rueters reports that J.M. Smucker Co (SJM.N) posted higher-than-expected quarterly earnings as its Folgers coffee business continued to drive improved results, and the company signed a deal to sell coffee packs for Green Mountain Coffee Roasters Inc’s (GMCR.O) brewers.

Smucker, best known for its peanut butter and jelly, posted third-quarter net income of $135.5 million, or $1.14 a share, compared with $77.9 million, or 68 cents a share, a year ago.

Excluding items, the company earned $1.17 a share, beating analysts’ average estimate of $1.05 a share, according to Thomson Reuters I/B/E/S.

For the third quarter ended January 31, net sales rose 2 percent to $1.21 billion, beating analyst estimates of $1.16 billion.

Folgers, the largest producer of retail packaged coffee in the United States, contributed $510.3 million to net sales in the third quarter, compared with $468.5 million in the year-ago period.

Orrville, Ohio-based Smucker raised its full-year earnings outlook to $4.02 to $4.07 a share, excluding merger and acquisition costs, from its previous range of $3.95 and $4.05 a share.

Under the deal with Green Mountain, Smucker will market and sell Folgers and Millstone “K-Cups,” — coffee portion packs — for Green Mountain’s single-cup Keurig brewers.

While, Green Mountain will be the exclusive manufacturer of Smucker coffee brands of K-Cups.

Smucker’s shares closed at $60.11 Tuesday on the New York Stock Exchange.

John Costello on the Record at Forbes.com

Dunkin’ Brands Chief Marketing Officer goes on the recors at Forbes.com, watch the interview:

Dunkin’ Donuts turns 60

The Boston Globe reports that Canton-based Dunkin’ Brands Inc. celebrated the 60th birthday of Dunkin’ Donuts today at Boston’s Copley Square Plaza. Actor and comedian Lenny Clarke helped Dunkin’ executives blow out birthday candles and sing “Happy Birthday.” The celebration included samplings of Dunkin’ Donuts Hot Mocha Coffee, face painting, karaoke, coffee cup piñatas, and a $10,000 check presentation to “Birthday Wishes,” a local Boston nonprofit that provides birthday parties for homeless children.

Watch the video, shot by the Globe’s Wendy Maeda, to see more from the event.

The Boston Globe

Related Reading: At 60, it’s still ‘time to make the donuts’ at the Boston Herald

Dunkin’ Donuts Number One In Customer Loyalty For Fourth Straight Year

Restaurantnews.com reports that as Dunkin’ Donuts commemorates its 60th “BirthDDay,” the brand has earned another cause for celebration.  For the fourth straight year, Dunkin’ Donuts, America’s all day, every day stop for coffee and baked goods, has been recognized by the Brand Keys Customer Loyalty Engagement Index as number one in customer loyalty in the coffee category.  

The 13th annual national survey by Brand Keys identifies brands that are best able to engage consumers by meeting or exceeding their expectations, which creates loyal customers. The report accurately predicts which products consumers are most likely to purchase over the next 12 to 18 months. In the coffee category, consumer preferences were based on consistently meeting customer expectations for taste, quality, and service.

“This great honor is a tribute to our franchisees’ commitment to our guests.  Through their tireless efforts, Dunkin’ Donuts has become a daily ritual for millions of people who start their day with America’s favorite coffee and look to Dunkin’ Donuts to keep them running in the afternoon with a wide variety of beverages and snacks,” said John Costello, Chief Global Customer and Marketing Officer at Dunkin’ Brands.  ”We are thrilled to have earned the top ranking for customer loyalty four years running, and look forward to continuing to provide our guests with simple, delicious, affordable food and beverages.”

Brand Keys is the only research consultancy in the world that specializes in customer loyalty.  The Customer Loyalty Engagement Index identifies category brand leaders — those most likely to demonstrate the highest levels of consumer loyalty and profitability over the coming two years.

“In what has turned into a more and more competitive category, it is a tribute to the Dunkin’ brand that it has been able to meet the expectations consumers have when it comes to their coffee,” said Robert Passikoff, Founder & President, Brand Keys.

Read more at: Restaurantnews.com

Baskin-Robbins Taps 22squared for Advertising

Baskin-Robbins, the Canton-based chain of ice cream shops, said that it has awarded its advertising account to 22squared, an ad agency with offices in Atlanta and Tampa.

Baskin-Robbins, a sister chain of Dunkin’ Donuts, said that 22squared was selected after an ad agency review conducted by Pile and Co. of Boston.

A statement from Dave Nagel, Baskin-Robbins’ director of brand excitement, suggested 22squared’s mandate: “As Irv Robbins used to say: ‘We don’t just sell ice cream. We sell fun.’”

 Boston Globe Business Updates

Hess Opening Self Serve Dunkin Donuts in Mount Airy, NC

Mount Airy News reports that customers of the Wilco on Rockford Street have had trouble gaining access during the past week as construction crews have taken over the parking lot.

However, Steve Williams, president of Wilco, hopes the results of the ongoing renovation will be good for business.

As part of a new program by the company, Mount Airy’s Wilco will be gaining a Dunkin Donuts once construction wraps up sometime in the next 10 days.

“We’re renovating the inside and adding a Dunkin Donuts,” said Williams.

The Dunkin Donuts will provide self-service coffee and doughnuts for customers with doughnuts made in-house.

“It’s part of a program we’re rolling out to as many of our stores as we can. We have had good results so far. We’re optimistic,” said Williams.

Dunkin’ Launches Donut Contest

Following the famous Hollywood maxim of “They liked it once; they’ll love it twice,” Dunkin’ Donuts said it is reprising its “Create Dunkin’s Next Donut” contest in honor of the Canton chain’s 60th anniversary.

“For the second year in a row, Dunkin’ Donuts is inviting donut lovers to channel their imagination and love for donuts for the chance to win $12,000 and have their personal donut creation sold at participating Dunkin’ Donuts restaurants nationwide,” the chain said in a press release.

As Dunkin’ buffs may recall, last year’s competition winner was the “Toffee for Your Coffee” donut, and it was chosen from among 130,000 entries, the chain said.

Finalists in this year’s contest will get to visit Dunkin’ Donuts University, the Sorbonne of sinkers and jelly rolls. To find out more about contest rules, please click here.

For its birthday, meanwhile, Dunkin’ Donuts said it has created “a full line of commemorative retro packaging that incorporates a new ‘Happy 60th BirthDDay!” logo and historical brand logos.”

 Boston Globe Business Updates

Dunkin’ Donuts Celebrates 60 Years

QSR Magazine reports that Dunkin’ Donuts, founded in 1950, is celebrating 60 years of delicious coffee, donuts, and baked goods, and the brand is inviting customers all around the world to join the party with festivities planned throughout the year. Since its humble beginnings as a coffee and donut shop in the Northeast, Dunkin’ Donuts is now one of the world’s best-known brands.

The company’s “birthDDay” celebration kicks off with the return of the “Create Dunkin’s Next Donut” contest on February 8. For the second year in a row, Dunkin’ Donuts is inviting donut lovers to channel their imagination and love for donuts for the chance to win $12,000 and have their personal donut creation sold at participating Dunkin’ Donuts restaurants nationwide.

Watch this video from FOXProvidence.com

Last year, the grand prize winning donut, “Toffee for Your Coffee,” was chosen from among 130,000 entries submitted online for the inaugural contest.

Beginning today through March 8, visitors to www.DunkinDonuts.com/donut can create their own virtual donut masterpiece from a variety of donut flavors, shapes, toppings, and fillings. New interactive elements have been added to the contest Web site, providing entrants more options to save their creations and share their tasty treats with friends and family. A dozen finalists will be chosen by a panel of Dunkin’ Donuts judges to travel to Dunkin’ Donuts University, the worldwide training center for the company in Massachusetts, this spring. They will participate in a a bake-off, which will be facilitated by Dunkin’ Brands executive chef Stan Frankenthaler.

This year, JetBlue, Boston’s leading carrier, has signed on to be the official airline of the “Create Dunkin’s Next Donut” contest and will offer free airfare to contest finalists flying out of JetBlue cities to the bake-off. The public will also be invited to vote for their favorite finalist online beginning April 19. The grand prize winner/creator of “Create Dunkin’s Next Donut” contest will be unveiled on National Donut Day, June 4.

For its birthday, Dunkin’ Donuts has created a full line of commemorative retro packaging that incorporates a new ‘Happy 60th BirthDDay!” logo and historical brand logos. Additionally beginning in March, the company will offer a selection of vintage-themed T-shirts and retro Dunkin’ Donuts Cards at its Web site as well as at participating restaurants while supplies last.

Dunkin’ Donuts will also host birthday celebrations at the original store located in Quincy, Massachusetts, and at nearly 60 new restaurants that are scheduled to open over the next several weeks in 10 countries including the United States, China, Chile, and Germany.

“Dunkin’ Donuts’ 60th birthday is an opportunity for us to honor our heritage and commitment to menu innovation – both of which have made us the beloved brand that we are today,” says John Costello, chief global customer and marketing officer at Dunkin’ Brands. “As we commemorate 60 years of serving the country’s best-tasting coffee and baked goods, we look forward to celebrating our birthday with our loyal guests who make us a part of their everyday routine.”

QSR Magazine

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