dunkin donuts -...
TRANSCRIPT
Dunkin Donuts
John Beebe-Center
Terrence Gagala
Meghan O’Brien
Drew Rosen
HOSP 3050 - Hospitality Strategic Marketing
Professor Howarth
2/17/2014
Beebe-Center, Gagala, O'Brien, Rosen 2
Contents Introduction .................................................................................................................................................. 3
Core Product ............................................................................................................................................. 3
Facilitating Product ................................................................................................................................... 4
Supporting Product ................................................................................................................................... 4
Augmented Products ................................................................................................................................ 5
Service Characteristics .................................................................................................................................. 5
Intangibility ............................................................................................................................................... 6
Inseparability............................................................................................................................................. 7
Variability .................................................................................................................................................. 8
Perishability ............................................................................................................................................... 9
Price .............................................................................................................................................................. 9
Distribution Channels .................................................................................................................................. 10
Promotion ................................................................................................................................................... 10
Conclusion ................................................................................................................................................... 11
Works Cited ................................................................................................................................................. 12
Work Breakdown Structure for Dunkin Donuts .......................................................................................... 13
Beebe-Center, Gagala, O'Brien, Rosen 3
Introduction
From the survey we conducted on the areas surrounding Providence, RI, we decided to
launch a new line of tea's. Using Providence as a test market, we want to explore the success we
can have by offering more tea options. Tea is one of the world's most popular beverages, and it
showed on our survey's; almost 50% of respondents stated that they drink tea. Our menu
currently only has three tea options; the basics of green, oolong and black teas. Our new line will
expand upon our existing flavors and ideally allow us to capture a currently growing market.
Teavana and Tealuxe are two chains that are two growing chains of "tea bars" that are
capitalizing on this market. Starbuck's also offers over 25 tea based options to cater to this
market. By adding tea to our product line we can better compete with these companies. Our new
product line will contain a raspberry herbal tea, a cranberry herbal tea and a peppermint herbal
tea.
Core Product The core product that people usually purchase at Dunkin Donuts is coffee. There are
many types of coffee but the two main coffees are hot and cold. They give you the options to
choose from once ordering your coffee. People usually order hot coffee when it’s cold outside
and ice coffee when it’s hot outside. Their slogan, “everyone runs on Dunkin” is true because
many people can’t get their day started without coffee.
This addition of these three herbal teas to your choice of beverages will not directly affect
coffee. We are not trying to replace our loyal customer's favorite brew; we are looking to expand
our menu to bring in a new base of customers. The addition of tea also offers a healthier, lower
caffeine option to attract the growing health and fitness markets back to our shops.
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Facilitating Product Facilitating products is mostly about the employees who serve the coffee to the
customers. Furthermore, the employees who work the drive thru windows are a huge part
because most of the people who go to Dunkin Donuts go thru the drive thru window. Obviously
the workers at Dunkin Donuts will use their hospitality skills to make sure the customer gets
what he/she want. Usually if it’s cold outside, customers will need to use napkins to hold their
coffee or even if the coffee is hot or cold in general.
The addition of the new line of herbal teas will not change the set up of our facilities
much. We will possibly need more room for storage and more tea brewing stations set up at the
front counter. The drive thru, service counters and the service stations containing the paper goods
our customers rely on will remain the same. The biggest change will to be training the employees
on the new items and having them suggest them to the customers.
Supporting Product The main supporting products that Dunkin Donuts has to offer is the donuts, sandwiches,
and the merchandise that they offer. Most people like to get something to eat when they go to
Dunkin Donuts. Customers have different types of products to choose from. These different
types of products help the DD product differ from the types of products that Starbucks or other
coffee shops offer.
With these new teas added to our menu, we will be able to compete with Starbuck's on a
higher level. Starbucks already offers twenty-four different varieties of tea drinks to compare to
our simplistic menu. Dunkin Donuts only currently carries green, oolong and black teas. By
diversifying our menu, it is our hope to attract new customers and be better fit to compete with
Starbucks and other competitors. These tea's will act as a substitute good for coffee, leading to
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broadening of our customer base. We will still continue serving the same complimentary goods
as before.
Augmented Products The augmented product of Dunkin Donuts is the interaction you receive as a customer
from the employee. As an employee you want be able to give the customer the visit of a life
time, meaning that nothing goes wrong. Customer interaction is huge because the employee
needs to greet and say goodbye to every customer.
Looking at the variety of locations online, the atmosphere really grabs the customer’s
attention. The customer has the opportunity to submit their feedback because Dunkin Donuts
likes to hear the complements/complaints that are made by the customers. Customers want to be
in and out of the door, so they employees of the store locations need to make sure that everything
is accessible to the customers. Customers expect the service and product to be good enough for
them to return in the future.
This expansion of our beverage line gives us multiple opportunities to please more
customers than before. By adding on this product, new customers will be entering and with a few
good visits make Dunkin Donuts tea a ritual of their own. Once again, training the employees on
this new product is essential for success in the future with building these relationships.
Service Characteristics
To promote our new tea lines we have to make sure our service characteristics are up to
date. The four service characteristics that really help promote are product are intangibility,
inseparability, variability, and perishability. Intangibility is the services that can’t be seen,
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tasted, felt, heard, or smelled before purchase. Variability is the quality of services that depend
on who provides them and where, when, and how. Inseparability is services that can’t be
separated from their providers. Finally perishability is services that can’t be stored for latter
sale or use. All these service characteristics are key factors for our new tea products to be
successful.
Intangibility
According to our textbook intangibility are services that can’t be seen, taste, felt, heard or
smelled before the purchase. It’s pretty much marketing using tangible objects, that don’t so
you’re probably wondering how this affects the coffee we drink almost every day. Our new tea
product, will have to be advertised a different way because we want more customers to be able to
come in to Dunkin Donuts and purchase it. Marketing a product can be tough but if you advertise
it correctly, more people will purchase it.
Another way it’s intangible with its coffee is the quality of Dunkin’s service that provides
you. Before you even purchase it Dunkin experts on average test out the new tea product every
day to make sure it stays consistent. Also all Dunkin Donuts have customer surveys that lets the
employees know what they can improve on. It may not help much with the first immediate trip,
but it will help future trips before the first customer even walk in the door. This also have the
additional benefit of increasing management’s focus on the brand, which is set apart as a crucial
asset. It also ensures that, rather than being given the brand to use for free, management is now
responsible for ensuring a healthy return for its use. These intangible services help them compete
with places like Starbucks and McDonalds that are high competitors in the coffee industry.
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Inseparability
What will make our products inseparable from the other places that serve herbal tea is
how our service is. Service is what keeps people coming back to the place. This means that we
need to make sure that all of our employees are up to date with the product and everything
about the new herbal tea product, to re-ensure the consumer to buy the product. It’s the
manager’s job to inform each employee every single fact about the tea, so employees can sell
the tea to the consumers. Consumers are more impressed and are more likely to buy a product
when an employee can list off each fact about the product. We should also offer nutrition facts
about the product because today every one cares about how healthy the product is they’re
about to consume.
Another way to keep the product inseparable is have each new employee that goes on
shift to try the product, to re ensure that the tea is to perfection for every customer. This is
what Dunkin does for their coffee every morning and it re ensures the customer that they’re
drinking the highest quality tea every day. Finally, it’s important to leave out certain items that
go in tea like honey/sugar for the customers to put in themselves. Even though Dunkin does put
everything in them to make life easier for the consumer, it’ll quicken up time for the employee
and also it allows the consumer to have the drink exactly how they like it. This will increase
business because it reduces time so employees can serve more quickly and the consumer can
have their drink exactly the way they want it.
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Variability
To make our new herbal tea products successful really depends on the quality of service
that is provided by our employees serving the customers. To really promote it we need to place
signs promoting the new tea flavors all over the store to really catch the consumer’s eye. This
will actually let the consumer know and maybe they will even want to try out the new product.
Maybe also have an advertisement place in the facility with someone famous to really make the
consumer try the product. For example almost every Dunkin Donuts one of our representatives
went to have a cardboard cutout with Ron Gronkowski promoting a new steak and egg
sandwich. This really catches the consumer’s eye because in the eyes of consumer seeing a big
celebrity holding a product really makes people want to try the product. This could also lead to
maybe a celebrity going to different Dunkin Donuts in different areas offering a meet and greet,
and offering free samples to really bring in a lot of consumers to try the new products. This
could really expose our new herbal tea product.
It’s also important for our employees to have top notch service. We believe that Dunkin
should implement to their employees to say the following when introducing themselves to the
customer: “Hello my name is (insert name here) and welcome to Dunkin Donuts. Would you
like to try are new herbal tea today.” Many fast food places do this when they have any new
product because it informs the consumer that there is a new product and the likeliness of the
consumer buying it increases. It’s also necessary for the consumers to have a great background
knowledge on the product like different flavors because if the consumer asks questions about
the product they’ll expect the employee to respond with an answer rather quickly and will
again increase the chances of the consumer to buy it.
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Another good idea for us is to monitor customer satisfaction by offering surveys of the
service and how they like the product. This will allow us to see how much they like the product
and give us an idea how we can improve the product/ if we should keep the product going.
Surveys are the most efficient way to see if the product will be successful in the long run. Also
it’s important that the quality of service is very high and the facility is clean and up to food
safety codes because these are important factors to have the consumer come back again and
buy our product.
Perishability Perishability is defined as services that can’t be stored for later sale or use. This is pretty
obvious when talking about the new tea product because you can’t really save tea for later; even
if it’s cold it loses its freshness. If they don’t constantly make fresh tea and keep up with peoples
order, there is a recipe for disaster. Each Dunkin employee needs to make sure that each cup is
made to the customer’s perfection or the customer won’t be happy. Usually if made wrong
Dunkin will replace the cup, but that’s a waste of tea which is trying to be avoided. Messing up a
cup of tea makes the customer angry and the process for them to receive the cup of coffee will be
longer. Dunkin employees have monitors and can write it down to ensure that they won’t forget
the customer’s order.
Price
Right now Dunkin Donuts only has 3 varieties of tea, regular black, decaf, and green. Hot
tea ranges from a size small to extra-large and costs from $1.49-$2.39. The new teas should be
offered with this same price range. A box of 20 count tea bags is $5.99 and when deciding to
offer the new flavors prepackaged, they should be this price as well. Dunkin Donuts should keep
Beebe-Center, Gagala, O'Brien, Rosen 10
all the pricing consistent so customers will want to buy the new teas and still have the same low
prices they have come to expect.
Distribution Channels
The Dunkin Donuts Brand uses the National DCP to deliver its products to the Dunkin
Donuts franchises and will continue to do so for their new line of teas. The National DCP is an
exclusive purchasing and distribution entity for over 7,000 Dunkin Donuts locations in the
United States. They will just add the new varieties of tea to their products. Dunkin Donuts will
utilize all their franchises as distribution for their main distribution channel for the new teas. This
will be the most effective way to introduce the new product to the market and to see how the
customers will react to it.
After selling it in the franchised locations for several months, Dunkin Donuts can gage
how well the tea has been perceived by customers. If the sales are good, the Dunkin Donuts can
start selling the packaged tea in food stores. This will help reach more customers and reach the
consumers that like to have hot tea at home. The new tea flavors should also be placed online as
well for people to order.
Promotion
Dunkin Donuts utilizes a large variety of promotional methods. To quickly get word out
about their new product, they should run multiple television, radio, and billboard advertisements.
By using multiple different promotional methods, Dunkin Donuts will be able to reach large
amounts of people and persuade those who would not normally go to Dunkin Donuts to come
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and try the new product. Another great method would be to place coupons in popular magazines
and newspapers to entice people to try the product and hopefully create new customers. A simple
promotional method would be to place posters on the windows of Dunkin Donuts franchises
displaying the new tea varieties. People will see these posters as they walk or drive by and could
be tempted to walk in a try the new product.
Conclusion
Expanding our market to include more teas will allow us to start new relationships with
customers and strengthen existing ones. This diversification will protects our assets and allows
the company continuing growth and stability. This also speaks of our never ending desire to
please our customers, as they inspired this change.
Beebe-Center, Gagala, O'Brien, Rosen 12
Works Cited "Dunkin' Donuts National Franchisee-Owned Distribution & Purchasing Cooperative to Open
First Local Distribution Center West of the Mississippi." DunkinDonuts. Dunkin' Brands Media
Relations, 8 May 2012. Web. 13 Dec. 2013.
"Driving Tomorrow's Business." Driving Tomorrows Business. National DCP, n.d. Web. 16
Dec. 2013.
"About Us." DunkinDonuts.com. N.p., n.d. Web. 17 Dec. 2013.
<http://www.dunkindonuts.com/content/dunkindonuts/en.html>.
"Let's Hear It For Consistency." DunkinDonuts.com. N.p., n.d. Web. 17 Dec. 2013.
<http://www.dunkindonuts.com/content/dunkindonuts/en/coffee.html>.
DunkinDonuts.com. N.p., n.d. Web. 17 Dec. 2013.
Saif, Wagar. "Is Dunkin Donuts the Best Coffeehouse in Town?" Is Dunkin Donuts the Best
Coffeehouse in Town? The Motley Fool, 17 Dec. 2013. Web. 17 Dec. 2013.
Sellen, Tom. "Coffee Connoisseurs Sniff Out Cheaper, No-Frills Fix." The Wall Street Journal.
The Wall Street Journal, 16 Mar. 2009. Web. 16 Dec. 2013.
Smith, Stephen. "Ten Reasons Why Tea Is Better than Coffee." Tea. Teaviews.com, 24 Mar.
2013. Web. 15 Feb. 2014.
"Teas." Starbucks: Menu: Tea. Starbucks, n.d. Web. 15 Feb. 2014.
Beebe-Center, Gagala, O'Brien, Rosen 13
Work Breakdown Structure for Dunkin Donuts Prepared By: Terrence Gagala (Project Manager) Date: 2/13/14
A. Terrence Gagala
1. Project Manager
2. Team Member
3. Sections include:
- Title Page
-Introduction
-Product
-Conclusion
-Works Cited
-PowerPoint Slide Show
B. Drew Rosen
1. Team Member
-Sections include:
- Service Characteristics
-Intangibility
-Perishability
-Works Cited
C. Meghan O’Brien
1. Team Member
-Sections include:
- Promotion
-Price
-Distribution Channel
-Works Cited
D. John Beebe-Center
1. Team Member
-Sections include:
- Service Characteristics
-Variability
-Inseperatability
- Works Cited