Alleged pleasant smells notwithstanding, Dunkin’s food is spectacularly unsavory. Later, I asked John Gilbert, the company’s vice-president of marketing (and one of the few company executives who didn’t make the trip to New York), why Dunkin’s doughnuts, bagels, and the like were barely mentioned in the current flurry of ads. He hemmed and hawed for a minute before offering, “We get you in with coffee and hope you see something you can’t resist.”
Not bloody likely. Dunkin’ Donuts’ drive to diversify from its carb-crammed, molar-rotting title treats has turned the act of ordering food there into something like tacitly enlisting in the Hemlock Society. Yes, the Boston Kremes and Munchkins, long a staple with the bulimic-undergrad crowd and the guy in your office most likely to have angioplasty, are still popular, but the sugary items I sampled were nothing special unless you live for the jittery, slightly paranoid feeling you get after mainlining a pound of processed sugar. Bagels are also available, but a Dunkin’ bagel is to an H&H bagel what John Stamos is to George Clooney, alike in appearance only. Starbucks’ cellophane-wrapped $6 sandwiches are a crime against commerce and fairness in pricing, but it’s unlikely those products will kill you. I feel fairly confident, on the other hand, that Dunkin’s new steak-egg-and-cheese breakfast sandwich is what the Grim Reaper packs in his lunch box. After purchasing one of the microwaved concoctions, I took it back to a friend’s house, where we dissected it like a bio-lab frog. No matter the poking and prodding, we were unable to determine which yellowish glistening oval was cheese and which one was egg.
As our SUV rolled through Manhattan, various members of the Dunkin’ posse repeated, mantralike, that the company wasn’t in competition with Starbucks. “Our product is unique. We’re running our own race,” said John Dawson, vice-president for development. It was pure corporate spin (don’t dignify the competition with an acknowledgment) but also partially true. Dunkin’ doesn’t need to destroy Starbucks to thrive; it’s more than happy to share the java pie with its froufrou counterparts. In market-speak, Dunkin’ is going after the “non-occasion” coffee drinker. I first heard the term from Gilbert. “Customer segmentation is something we look at,” he told me. “Coffee drinkers have occasion and non-occasion coffee stops. Let’s say there’s a professor on the way to the gym. He pops in for a quick cup of coffee: That’s a Dunkin’ occasion. He might not be able to get in and out of a Starbucks quick enough. Now there might be another time where he has an hour before a meeting and he might end up at a Starbucks.”
At the same time Gilbert subtly jabs Starbucks’ somnambulistic service, he implicitly concedes the fancy-pants java market to Dunkin’s posher competitor. And so does his boss. Last year, Dunkin’ Donuts CEO Jon Luther told Fast Company, “Five years from now, if you’re looking for coffee, there will be only two places you’ll be thinking about: Starbucks and Dunkin’.” The Dunkin’ generalissimo went on to freely admit that his franchises do not attract the precious type of employee needed to compete with the Starbucks barista. “Everybody says it’s about the crew members,” said Luther. “But not only can you not get them to up-sell, you can’t even get them to smile and say thank you! Half the time you’ve got an 18-year-old kid who’s looking at his watch, or an immigrant who’s not speaking the language as well as you want.”
Perhaps not surprisingly after that bout of truth-telling, Luther wasn’t made available for this story.
At about one o’clock, the Group of Eight and I made a stop at a bright and airy Dunkin’ Donuts just off Wall Street. Despite its aesthetically pleasing location and floor-to-ceiling windows, members of the ocho mumbled obscenities and rolled their eyes. Apparently, the promotional posters were not up-to-date. But that’s another story. What was most notable about this location was there were three more within two blocks. That’s the key to Dunkin’s success: saturation marketing.
One of the problems with any no-frills product, whether it’s Southwest Airlines, Supercuts, or Dunkin’ Donuts, is that the product alone isn’t memorable enough to ensure return business. If a customer finds the same product a dime cheaper down the street or if your stores aren’t supremely convenient to get to, he’s gone. “There’s a lack of cachet with Dunkin’ Donuts as it expands into New York and other markets,” says Moore. “It doesn’t have the mystique of a Krispy Kreme or In-and-Out Burger. No one is lining up for an hour to get into a Dunkin’ Donuts. It’s good, but people are not clamoring for it. So it has to be marketed differently.”