Dunkin’ is dropping the donuts – from its name, anyway. Doughnuts are still on the menu, but Dunkin’ Donuts is renaming itself Dunkin’ to reflect its rising emphasis on coffee as well as other drinks, that make up 60 % of the sales.
The 68-year-old chain has toyed with all the idea for some time. In 2006, it released a whole new motto – “America runs using Dunkin’ – that didn’t mention doughnuts. Last fall, it tested the “Dunkin’” logo on a new store in Pasadena, Calif.; it has put the name on the few other stores ever since then.
“Our new branding is really a clear signal that there’s new things at dunkin donuts menu prices. It speaks to the breadth in 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 will start appearing on napkins, boxes and signs at new and remodeled U.S. stores. The modification will gradually be adopted as franchisees update their stores. It will likely be phased in overseas on the next year, the business said. Dunkin’ Donuts has 12,500 restaurants worldwide.
The brand new logo will still have Dunkin’ Donuts’ familiar rounded font and orange-and-pink color scheme, in which the company has used since 1973. The Canton, Mass.-based company isn’t saying how much the change will surely cost.
Dunkin’ Donuts has always sold coffee, but hot breakfast sandwiches and specialty drinks just like the fruity Coolatta and Cold Brew iced coffee have become increasingly essential to the chain. Within the second quarter of the year, the company noted that overall U.S. store traffic was down, but revenue was up thanks to sales of higher-margin iced coffee drinks and breakfast sandwiches.
Dunkin’ says the name change is among a number of things it’s doing to remain related to younger customers. It’s also simplifying its menu and adding dedicated mobile ordering lanes. But changing the name of iconic brands could be 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 using the complete name. Specific words are easier for individuals to consider and conjure emotional connections, she said. Having “Donuts” inside the name is also easier for people in overseas markets who may not understand what “Dunkin’” means.
Messing with iconic brands could also have consequences. In 2016, 20 years after replacing Kentucky Fried Chicken with KFC, the business were required to issue a press release to combat an internet rumor it was forced to change its name since it doesn’t serve real chicken. And IHOP faced some backlash earlier this season when it announced it absolutely was changing its name to IHOb to remind customers that it serves burgers along with pancakes. That one had been a publicity stunt, however it annoyed some customers.
Dunkin’ Donuts’ Chief Marketing Officer Tony Weisman said the business has done plenty of testing and doesn’t expect any customer backlash from the decision. “The reaction has been overwhelmingly positive,” Weisman said. “It’s just going to feel totally familiar to people.” But Reis said even when doughnuts have fallen from favor among a more health-conscious subscriber base, people know Dunkin’ Donuts being a place where they could just get coffee and like the doughnuts’ smell.
“There’s nothing wrong with still having ‘Donuts’ in your name,” she said. “Long term it absolutely was helping them, giving them a brand name 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 for the smooth coffees when compared to a bold drink like espresso.
Dunkin’ has become remodeling its stores with cold-brew taps and drive-through lanes for mobile orders. Like Starbucks, the chain has struggled to draw in new customers. Dunkin’s U.S. same-store sales grew 1.4% inside the second quarter, as an increase in average check offset a decrease in traffic. The company is scheduled to report third-quarter results on Thursday.
Dunkin’ has lagged behind in espresso sales because the category had become the fastest-growing kind of coffee in cafes in recent years. McDonald’s Corp. has a line of low-price espresso drinks, too. The new espresso beverages bdcovh be served at Dunkin’s more than 9,200 U.S. stores in bright orange cups to differentiate them off their Dunkin’ drinks in white or clear cups.
The organization is investing $100 million inside the U.S. within the next year, over half of this in restaurant technology, including the espresso machines. Franchisees have committed much more money towards the upgrades. Dunkin’ wouldn’t say how much franchisees are contributing or just how much the newest machines cost. Company executives select the Swiss-made machine that will be the new standard, following trips to Europe and repeated tests to obtain the extraction looking at the coffee beans just right.
“The new equipment in certain ways is faster than the 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 you can hand-pull espresso shots, steam milk and blend the different drinks with various flavors. He said these are already drawing in new clients in Baltimore.