Dunkin’ Is Nuts

The news has officially come down, (although it’s been in the works for almost a year,) that Dunkin’ Donuts, the international (yes, they have stores in 36 countries,) brand that was established nearly 70 years ago, is changing its name.25_Dunkin_Before_After_c4885e75-fe56-4add-aab3-a51120689229-prv

They will no longer be Dunkin’ Donuts, but will officially change their name to simply Dunkin’ as of January, 2019. According to the company’s official press release, the plan behind this switch is to transform the company into a “beverage-led, on-the-go” brand.

To cut to the chase, this is a bad idea. A really bad idea.

Let’s start at the beginning. Dunkin’ Donuts dominates in the donut category, leading Krispy Kreme and Mister Donut by a long way, and by a wide margin in terms of number of stores.

The brand also competes in the coffee category, and meets a strong and persistent consumer need in that area. And for decades, Dunkin’ Donuts coffee has established itself as unique, based on flavor profile (and, some would argue, sheer temperature.)

As the quick-serve coffee category has expanded in the last 20-30 years, and has come to be dominated by Starbucks, Dunkin’ Donuts has pivoted to offer more varieties and flavors of coffee and espresso drinks, and has achieved a strong challenger position. According to Statista, Starbucks has almost double the market share volume over Dunkin’ Donuts in this category, and slightly more than all others combined (not including Dunkin’ Donuts.)

So if you’re a challenger brand in any category (and this has turned into a classic leader/challenger category like Coke/Pepsi or McDonald’s/Burger King,) your goal as a brand should never be to appear MORE like the leader. The goal is to establish difference.

And DONUTS is what makes this brand special.
DONUTS is what makes this brand DIFFERENT.

Now, the Dunkin’ brand will still carry donuts.  But when you don’t tell people that it’s what makes you different, (say, by including “donuts” in your brand name,) who’s to say that consumers will inherently know? Especially young, entering-the-market consumers who may not be familiar with the brand’s history?  What will Dunkin’ mean 10 or 20 years from now without context?

The idea of changing the name to Dunkin’ at all seems wholly misdirected.  When the press release states that you want to be a more “beverage-led” brand, the slang word “Dunkin'” doesn’t say “beverages” at all.  What’s more insulting is that the name referred to the verb of actually. dunking. donuts. in. coffee.

So let’s review:  Dunkin’ Donuts is perceptually and verbally moving AWAY from the category they dominate, and CLOSER to a category where they challenge a leader who owns nearly twice the market share, and where their only competitive advantage is average price.  Sounds like a frozen-double-mocha mistake in judgment to me.

Dunkin’ (as they will be called in a few months,) should stick to what they’re good at – good coffee and family-friendly offerings served in modest stores at moderate pricing. AND LOTS AND LOTS OF DONUTS.

 

 

 

 

VW: follow-up to previous post

Back on November 11, 2015 I wrote a post entitled “Das Issues: What’s Next for Volkswagen?”    In it, I discussed the emissions scandal, and what I thought the brand could do to start the process of reconnecting with current customers and reaching out to prospects.

At the end of the post, I made a suggestion that went like this:

If I was a brand consultant for Volkswagen, (full disclosure: I’m not, but certainly available!) I would start by going back to what helped build their perception: The dorky little outsider that promised the moon and modestly delivered it. My very next ad headline (think full page insertions in The New York Times, Wall Street Journal and USA Today,) would probably read “11 million Lemons.” And the body copy would go on to overtly apologize for the transgression, and then outline the steps we were taking to make good on our (new) promises and deliver exceptional automotive engineering.

And then I’d invite consumers to come along for the (literal and figurative) ride to redemption. Das Step 1.

So I was just poking around today and saw this article about Volkswagen. As you can see, it’s written on November 17th.  It talks about how VW started running full-page insertions in The New York Times, The Washington Post and The Wall Street Journal.  The headline reads “We’re working to make things right.”  And the CEO apologizes for the transgression, and begins to outline some steps to make good.

Kooky, huh?

Breaking (Bad) news: Marketers LIE!

I know it sounds like heresy, but I’m here to break bad news: marketers lie. Most specifically, they lie in their advertising. They’ll do or say virtually anything to GET YOU TO LOOK OVER HERE! It’s nothing new. They’ve been doing it for decades, from omitting “unnecessary” items on their package labeling, or touting offers that get negated in 30 lines of 5 pt heavily kerned knockout legal copy.

And it’s hard to avoid. Because in many instances, the competitors are lying too. So some awfully nice marketers are often forced to join in the lying spree to make sure YOU LOOK OVER HERE TOO!

Case in point: Century 21, the national real estate broker, recently perpetrated an outright lie to draw attention to their brand. Wanting to capitalize on the enormous popularity of the AMC TV Series Breaking Bad and tie in to the September 29, 2013 series finale, and seeking a solution around the enormous costs associated with advertising on the show, they opted for a more, um, unorthodox solution.

Century 21, and their agency Mullen, ran the below ad in Craigslist, listing fictional character Walter White’s Negra Arroyo lane ranch.

cent21_cl_ad

See the full listing at http://albuquerque.craigslist.org/reb/4098553645.html

Pretty neat, huh? It’s a funny and quirky idea that leverages the popularity of the show. And they make no bones about it: the ad is a farce. It’s laced with Breaking Bad references, and inside jokes about how there’s nearby “RV spots” and a “motivated seller” who must be out by 9/29. Let’s face it. It’s pretty funny stuff.

But it’s also an out and out lie. And here’s the thing – they may have misled some people in the process. I commented on the AdAge article about the stunt and surmised that there may have been 117 people who actually clicked on the ad interested in this home. (Seriously, a 3BR ranch in a nice neighborhood for $150K listed by a reputable broker would MAKE ME LOOK.) And let’s say that 20 or so of those people immediately understand that it’s a Breaking Bad riff, and get a good chuckle out of it. That’s 97 misled people who MAY now have a bad taste in their mouth about the brand.

When you call the telephone number associated with the ad, you’re told “this house isn’t really for sale. But if you’re interested in buying a home, call Century 21.”

It seems odd to me that THAT’S the way you’d like to call attention to your brand. Sure, I get the bulleted list of reasons to do this:

– capitalize on Breaking Bad popularity
– show people in the target 25-44 demographic that Century 21 is a little hipper than you might remember
– get some ink around the #breakingbad and #waltshouseforsale hashtags

But still, if Mullen didn’t issue a press release around this concept, who would know about it? Maybe the extended social networks of those 20 potential buyers who are also Breaking Bad fans. But heck, you may have 97 people crowing to THEIR extended social networks about how they were DUPED by Century 21 in the name of a marketing “stunt.”

Brands have a hard enough time trying to maintain their personalities among competition, economic trends, and other market forces. So it’s ill-advised to pull out the rope-a-dope in the hopes of creating fans.

But as I said earlier, lying is nothing new for marketers. I recently received a promising email from JetBlue touting a two-day sale with “fares starting at $69.” And it happened to be somewhat true, there WAS a fare starting at $69. Just one. From New York to Buffalo. EVERY other flight leaving out of New York was more than $69, with some as high as $249. The promised fare carried restrictions like:

• “travel on Tuesday and Wednesday only” and
• “travel between October 8th and December 18th” and
• “blackout dates of November 22nd through December 2nd” and
• “may not be available on all flights” and
• “does not include fees for optional services” and
• “additional restrictions apply.”

While this is all important legalese, it ultimately dilutes the power and appeal of the original promise. So as a consumer, I’m left holding the bag on a flight I don’t even want to take, on days I don’t want to fly, just to try and save a few bucks? No thanks.

I’ve written many times that brands are very delicate entities that are built over time. Most importantly, one of the primary aspects of a brand is that it is a cumulative phenomenon – the perceptions and overall impressions are built over time into what you ultimately believe about the brand and its promise. And when brands start lying to me about virtually everything, (even as a goof,) those perceptions start to erode. And as a consumer, there are so many “shiny new things” out there, that I’m likely looking for another promising offer within 2 minutes.

Take note Century 21 and JetBlue and any other brand that’s still using snake oil salesman tricks from 100 years ago.

It’s a new age.

It’s a new consumer overloaded with choices.

You can’t just break bad and expect it to keep working.

Why, Hightail?

The very popular file sharing service, formerly known as YouSendIt, has now changed their name to Hightail.  No, keep reading…I’m serious.

This is what their homepage takeover message looks like:

hightail_takeover

So the obvious question is…why?  And let me qualify that question with some color.

Why, if you’re a file sharing service, a service that allows YOU to take a large file and SEND IT to someone else (for free on the basic plan, I might add) change your name from YouSendIt to, well, anything else?

Why, if you’ve invested all this time and money for nine years in the back end cloud storage virtualized pool infrastructure, and invested in acquisitions and technological upgrades, and invested in marketing and advertising, would you change your name from YouSendIt to, well, anything else?

Why, even if you’re announcing broadening your offering from file sharing into digital file collaboration services, would you change your name from YouSendIt to, well, anything else?

Why, when there’s nine years of brand equity built up, when you’ve outlasted some pretty high profile would-be competitors, (including the flailing DropBox,) when you’ve gotten 4 out of 5 stars from PC Magazine, when you’re finally turning a profit on the premium services, when you’ve become the generic term for Internet file sharing services (literally, people verb-ize file sharing as “I’ll YouSendIt to you later,”) would you change your name from YouSendIt to, well, anything else?

It could be a number of things.  It could be new CEO Brand Garlinghouse (formerly of Yahoo!) putting his fingerprint on the company he’s been appointed to run.

It could be that YouSendIt doesn’t sound sexy or silly enough, and they wanted to sound more like Yahoo!, or Hulu, or Etsy or whatever.

YouSendIt could have done a lot of things to refresh – which they’ve done with Hightail.  New, HTML5-coded website.  New features.  New look and feel.  Heck, they could have updated the logo.

And the folks at Hightail know the name thing is an issue.  It merits above-the-fold position on their homepage with a message that says “watch this short video to learn why we changed our name.”  Yes.  Let’s:

Okay, but still, the new name thing confounds me.  In the video, you hear some of the talking heads saying things like “the name YouSendIt constrained us in terms of our vision.”  [Tell THAT to Google.]  And “we don’t want a name that holds us back.”  And my favorite “we finally have a second chance to make a first impression.”  And that’s the quote that really stands out for me.

Because here’s the dirty little secret about branding that nobody teaches you in b-school.  You don’t get a second chance to make a first impression.  You only get one chance to make one impression to one prospect at a time.  And in my opinion, Hightail doesn’t make a bad impression.  It does something far worse.  It makes no impression at all.  It confuses rather than clarifies.

Don’t get me wrong.  I get “hightail” as a verb.  “I’ll hightail it over to you.”  Or “you hightail it over to me.”  But we’re not talking about meetings here.  [Really, “I’ll hightail it over to you” means “I’ll be right there.”  Not “I’ll get you that large file right away.”  So there’s even a semantics issue. Ugh.] Plus, it’s such a hipster-cum-corporate-acceptable piece of jargon. I wonder if they’re now headquartered in Dumbo?

From a pure brand perspective, the truth is that YouSendIt was a GREAT name for a brand.  It was functional.  It was short and sweet.  But mostly, and bestly (?) it conveyed a promise (You.  Send.  It. ) which, after all, is the heavy lifting of a brand.

Let’s watch and see what happens together.

Brands: Are they nature or nurture?

I’ve been doing a lot of talking, teaching and pitching around the concept of brands, and it seems that a lot of people – including professionals in the brand business – still have wildly differing ideas about brands and what they are.  And while this post is NOT intended to clear everything up in 500 words or less, I do think that looking at it from a different perspective will help.  So let’s evaluate brands on the simple x/y coordinates of nature vs. nurture.

Let’s take a simple consumer category, like ketchup.  If we’re developing a NEW ketchup brand, we’d have to fit it in the market alongside the primary players like Heinz and Hunt’s and Del Monte, and let’s throw in the niche marketer Annie’s who owns the “all-natural” position.  Aside from the typical line extensions (organic, gluten-free, sugar free, etc.) not a very cluttered market at all.

ketchup_brands

The basic NATURE of brands in this category:

Ingredients
Texture
Flavor

If you were going to enter a competitor into the market, the brand would have to declare itself different by nature (a unique flavor, or a unique combination of ingredients, maybe they only source specific tomatoes, etc.) and then – and this is the important part – have to become different by nurture.

The way brands in this category are NURTURED:

Price
Packaging
Distribution
Merchandising
Advertising (national vs hyper-local)
Social Efforts
Publicity
Partnerships/Sponsorships

So we could develop a brand (let’s call it Kelly’s) and give it a certain NATURE so that it fits in the category and has a chance to carve out some market share.  Let’s suppose Kelly’s is sourced using only organic plum tomatoes from Italy, packaged in a really cool NON-plastic carton, and is frequently preferred over Heinz during blind taste tests.  (Lots of differentiation points there, and also lots of category parody.)

On its own, the brand’s nature should allow it to enter the market and do fairly well (given the right distribution.)

But here’s where you see that brands are NOT just the sum of what they’re made of.

For Kelly’s to survive – and ultimately, thrive – the real work would be in changing the hearts and minds of those who are in the market for ketchup to allow them to make “mental room” for a new player.  With Heinz owning about 55% of the market, Hunt’s about 20%, Kelly’s would be competing with Del Monte and “all others” for a piece of the remaining 25% of the roughly $1 Billion ketchup market.  At first.  But given the right climate, the right amount of time and the right combination of nature and nurture, there’s no arguing that Kelly’s could ultimately unseat Heinz for the #1 spot.

But how much would that cost, and how long would that take?

The answer lies in how the brand is NURTURED.  If the advertising is cool, and the brand selects some pretty cool partnerships and sponsorships, and doesn’t overly rely on price promotion, and does well on the b-to-b side with slotting and merchandising, and doesn’t suck, then it’s likely that nurturing won’t take too long.

However, if ANY of those things is slightly misaligned, and misperceptions ensue, then it will certainly elongate the process of adoption.

Brands are a phenomenon in two important ways.  First, they’re a perceptual phenomenon. Brands don’t actually exist.  As I’ve told my students, there’s no vault somewhere in Pittsburgh where the Heinz brand is “locked away.”  It simply exists in the minds of consumers as a sum of experiences and interactions.  And while all those versions from all those consumers are slightly different, they do share a basic collective complexion.

Second, brands are a cumulative phenomenon.  Meaning that those experiences, interactions and overall perceptions are forged over time – good or bad – and the one-word phrase that you may connect with the brand (“rich,”  “thick,” “sweet,” whatever,) gets more and more embedded over repeat impressions of that initial imprinting on your mind.

Until ultimately, brands are weighed in the moment of truth in the condiment aisle when the consumer ponders whether she wants “thick” or “sweet” or “rich” when it comes to what she’s putting on her next burger.

So – are brands nature or nurture?  Yes.
But the real work begins ONLY after you’ve gotten everything right.