Dunkin’ is dropping the donuts – from its name, anyway. Doughnuts continue to be on the menu, but Dunkin’ Donuts is renaming itself Dunkin’ to reflect its rising focus on coffee along with other drinks, which make up 60 % of the sales.
The 68-year-old chain has toyed using the idea for quite a while. In 2006, it released a new motto – “America runs on Dunkin’ – that didn’t mention doughnuts. Last fall, it tested the “Dunkin’” logo over a new store in Pasadena, Calif.; it has position the name on a few other stores since that time.
“Our new branding is really a clear signal that there’s something totally new at dunkin donuts menu with prices. It speaks to the breadth of our offerings,” said David Hoffman, the CEO Dunkin’ Brands, the chain’s parent company, in a conference call with media.
The name change will officially take place in January, in the event it begins appearing on napkins, boxes and signs at new and remodeled U.S. stores. The alteration will gradually be adopted as franchisees update their stores. It will be phased in overseas on the next year, the business said. Dunkin’ Donuts has 12,500 restaurants worldwide.
The brand new logo will continue to have Dunkin’ Donuts’ familiar rounded font and orange-and-pink color scheme, that the company has used since 1973. The Canton, Mass.-based company isn’t saying how much the change will cost.
Dunkin’ Donuts has always sold coffee, but hot breakfast sandwiches and specialty drinks like the fruity Coolatta and Cold Brew iced coffee are becoming increasingly important to the chain. Inside the second quarter with this year, the company noted that overall U.S. store traffic was down, but revenue was up due to sales of higher-margin iced coffee drinks and breakfast sandwiches.
Dunkin’ says the name change is just one of a number of things it’s doing to keep related to younger customers. It’s also simplifying its menu and adding dedicated mobile ordering lanes. But changing the name of iconic brands can be quite a big mistake, says Laura Ries, an Atlanta-based marketing consultant.
Ries says “Dunkin’” eventually won’t mean anything to younger customers who haven’t grown up with all the full name. Specific words are easier for individuals to keep in mind and conjure emotional connections, she said. Having “Donuts” within the name is also easier for individuals in overseas markets who may well not understand what “Dunkin’” means.
Messing with iconic brands can also have consequences. In 2016, fifteen years after replacing Kentucky Fried Chicken with KFC, the organization needed to issue a press release to combat a web-based rumor which it was compelled to change its name as it doesn’t serve real chicken. And IHOP faced some backlash earlier this summer in the event it announced it absolutely was changing its name to IHOb to remind customers which it serves burgers as well as pancakes. That one was actually a publicity stunt, however it annoyed some customers.
Dunkin’ Donuts’ Chief Marketing Officer Tony Weisman said the business did a lot of testing and doesn’t expect any customer backlash from the decision. “The reaction has become overwhelmingly positive,” Weisman said. “It’s just likely to feel very familiar to people.” But Reis said even though doughnuts have fallen away from favor among a far more health-conscious customer base, people already know Dunkin’ Donuts being a place where they could just get coffee and relish the doughnuts’ smell.
“There’s nothing wrong with still having ‘Donuts’ in your name,” she said. “Long term it was helping them, providing them with a brand identity which had been the contrary of Starbucks.”
Starbucks representatives were unavailable for comment Wednesday. Going up against Starbucks, whose business was modeled after the espresso shops of Italy, could be a big challenge for Dunkin’, which always has been known more because of its smooth coffees than a bold drink like espresso.
Dunkin’ has been remodeling its stores with cold-brew taps and drive-through lanes for mobile orders. Like Starbucks, the chain has struggled to attract new business. Dunkin’s U.S. same-store sales grew 1.4% in the second quarter, as an increase in average check offset a decrease in traffic. The organization is scheduled to report third-quarter results on Thursday.
Dunkin’ has lagged behind in espresso sales since the category had become the fastest-growing kind of coffee in cafes recently. McDonald’s Corp. has a collection of low-price espresso drinks, too. The brand new espresso beverages bdcovh be served at Dunkin’s more than 9,200 U.S. stores in bright orange cups to differentiate them from other Dunkin’ drinks in white or clear cups.
The organization is investing $100 million within the U.S. within the next year, over fifty percent of it in restaurant technology, such as the espresso machines. Franchisees have committed much more money towards the upgrades. Dunkin’ wouldn’t say exactly how much franchisees are contributing or exactly how much the newest machines cost. Company executives chose the Swiss-made machine which will be the new standard, following trips to Europe and repeated tests to obtain the extraction from the coffee beans perfect.
“The new equipment in certain ways is faster compared to old equipment,” said Scott Murphy, chief operating officer of Dunkin’ U.S. Parag Patel, a franchisee who owns 25 Dunkin’ shops in Baltimore and five in California, spent months teaching his employees how to hand-pull espresso shots, steam milk and blend the different drinks with various flavors. He explained they may be already drawing in new customers in Baltimore.