Marketing Campaign Case Studies

Tuesday, January 29, 2008


Dunkin’ Donuts, the wholly owned subsidiary of the United Kingdom–based Allied Domecq PLC, reigned in 2000 as the world’s largest coffee-and-baked-goods chain. With 3,500 outlets and $2 billion in annual sales, the quick-service restaurant was outperforming competitors such as Starbucks Coffee Company and Krispy Kreme Doughnuts, Inc. Even though Starbucks and Krispy Kreme were rising in popularity, executives at Dunkin’ Donuts remained undaunted. They believed that Dunkin’ Donuts’ customers preferred the chain’s low prices and rapidly prepared drinks, such as its Dunkin’ Donuts Dunkaccino, an adaptation of a cafe´ mocha. After a survey conducted by the ad agency Hill, Holliday, Connors & Cosmopulos of Boston revealed that most customers considered Dunkin’ Donuts a respite from their everyday anxieties, Dunkin’ Donuts released its ‘‘Loosen Up a Little’’ campaign to brand its stores as a place to relax. The $60 million campaign was created by Hill, Holliday, Connors & Cosmopulos (often referred to as Hill Holliday) and targeted several different demographics. It first appeared during Labor Day weekend in 2000. The campaign’s television, radio, outdoor, and print advertisements suggested that its audience ‘‘Loosen Up a Little’’ with Dunkin’ Donuts. One spot featured a woman smearing cream cheese in the shape of a smiley face on a high-strung businessman’s jacket. In another spot a man removed his toupee during a coffee break, while in a different spot a businessman licked the jelly filling from his tie. Posters were hung inside elevators in office buildings throughout New England. The campaign included a fantasy-sports promotion that offered encounters with professional athletes such as the football linebacker Ted Johnson of the New England Patriots. Commercials for the campaign aired across major U.S. markets during the season premieres of the hit TV shows ER, Friends, and Law & Order.
‘‘Loosen Up a Little’’ ended prematurely in August 2002 because Dunkin’ Donuts executives considered the tagline ‘‘Loosen Up a Little’’ to be inappropriate for the advertising climate following the terrorist attacks on September 11, 2001. Nonetheless, the campaign helped Dunkin’ Donuts generate more than $2.7 billion in sales for the 2001 fiscal year and record a 7 percent sales growth for 2002. It also earned a plethora of awards at the 2002 Francis W. Hatch Awards, which recognized New England’s best ad campaigns.

Founded in 1950, Dunkin’ Donuts grew to become a leading quick-service restaurant on the East Coast. One of the chain’s longest-running campaigns, created by the ad agency Ally & Gargano, New York, featured ‘‘Fred the baker,’’ played by actor Michael Vale. The 15-year campaign used more than 200 spots, and in many Fred uttered the refrain ‘‘Time to make the doughnuts’’ early in the morning.
In 1989, while that campaign was underway,
Dunkin’ Donuts was purchased by Allied Domecq, the world’s second-largest alcohol distiller. Dunkin’ Donuts was not the only quick-service restaurant owned by the British enterprise. Allied Domecq had also acquired the ice-cream giant Baskin-Robbins and the sandwich chain Togo’s Eateries. In 1997, when Dunkin’ Donuts began expanding its offerings beyond just doughnuts and drip coffee, the chain ended its ‘‘Fred the Baker’’ campaign. New menu items helped Dunkin’ Donuts increase sales by 10 percent in 1998. That same year Dunkin’ Donuts awarded its advertising account to Hill, Holliday, Connors & Cosmopulos. The agency’s copywriter Marty Donohue and art director Tim Foley successfully pitched commercial ideas to Dunkin’ Donuts executives. One spot was about a police car chase that ended at Dunkin’ Donuts. Another commercial depicted a construction site past which beautiful women walked unnoticed, yet when a man carrying Dunkin’ Donuts Coolata drinks passed by, construction workers began whistling and hollering. Dunkin’ Donuts vice president of marketing Eddie Binder praised Foley and Donohue in Adweek for their lighthearted, humorous approach. ‘‘They just got it. They understood the brand,’’ he said. Some of the agency’s first work for Dunkin’ Donuts included a doughnut-naming promotion in which participants were eligible for either $50,000 or a lifetime supply of Dunkin’ Donuts. The promotion included the commercial ‘‘Ski Lodge,’’ which featured a woman using her beauty to dupe men out of Dunkaccinos. The ad agency conducted a survey that revealed that many Dunkin’ Donuts customers considered their shopping experience inside Dunkin’ Donuts as a ‘‘break from reality.’’ The survey results became the impetus for the upcoming ‘‘Loosen Up a Little’’ campaign.

The campaign included several executions to reach three distinct target markets. First, a poster execution appeared inside the elevators of 69 office buildings on the East Coast in early 2001. The posters, along with a majority of the campaign’s commercials, targeted what the ad critic David Gianatasio referred to in Adweek as ‘‘stressed-out urbanites.’’ The posters suggested that in the hectic lives of most workers, Dunkin’ Donuts offered a desirable place to ‘‘Loosen Up a Little.’’ By placing the posters in elevators, in which many business professionals spent a few minutes every work day, the campaign targeted what Dunkin’ Donuts field marketers called a ‘‘captive’’ target. Marty Donohue of Hill Holiday explained the timeliness of the campaign to the Boston Globe: ‘‘Dot-coms were rampant, and people were under a lot of stress. Dunkin’ Donuts was seen as a safe haven.’’ The campaign also targeted a demographic that Hill Holliday dubbed the ‘‘regular guy.’’ While Starbucks sold premium coffee drinks such as the cafe´ mocha for an average price of $3, Dunkin’ Donuts sold its equivalent, the Dunkaccino (a mixture of coffee, milk, and chocolate), for about $1.50. Dunkin’ Donuts was considered by its marketing department to be a brand for the mass market. To effectively reach this target, the campaign included ‘‘one-of-a-kind’’ sports-fantasy prizes. One prize allowed participants to win tickets to a Celtics basketball game and sit with Nomar Garciaparra of the Red Sox. Similar prizes included interactions with Ted Johnson of the Patriots, Paul Pierce of the Celtics, and Joey Franchino of the New England Revolution. ‘‘We’re the regular guy’s brand, so sports becomes a big part of getting access to our customer,’’ Dunkin’ Donuts vice president Ken Kimmel explained to the Boston Globe. The campaign’s third target included the East Coast’s burgeoning Latino community. Select spots that were originally filmed in English were later released with Spanish voice-overs on Hispanic television networks. The Latino community of Boston, the city with the most Dunkin’ Donut stores in America, had expanded from an estimated 36,000 Latinos in 1980 to 85,000 in 2000.

With the emergence of TiVo, a product that allowed audiences to skip unwanted television commercials, advertisers began creating new opportunities for television advertising. Coca-Cola reportedly spent $13 million to place its soft drink on the judges’ table on Fox’s hit reality show American Idol. Dunkin’ Donuts, the world’s largest coffee-and-baked-goods chain, paid to have its coffee placed on the reality television show High School Reunion. Phil Risinger, director of advertising for Dunkin’ Donuts, noted in the Boston Globe that the Dunkin’ Donuts’ product placement on the show was not intrusive. ‘‘It’s not in your face,’’ he explained. ‘‘They’re doing what folks do in the morning. They’re drinking coffee.’’

In October 2001 Starbucks was aggressively adding new stores to its existing 3,000 locations in North America. Advertising analysts were amazed by Starbuck’s ability to expand the specialty-coffee retail industry with relatively little advertising. Executives at Starbucks firmly believed that word-of-mouth advertising was more effective than paid advertising. Therefore, instead of financing exorbitant campaigns, Starbucks spent operating costs on its enjoyable in-store environment, premium coffee-based products, and unparalleled customer service. From 2001 to 2002 alone, sales for Starbucks jumped from $2.6 billion to $3.3 billion.
When Starbucks did advertise, it was usually in partnership with other major brands. In 2000 Starbucks formed an exclusive relationship with the New York Times. In exchange for publishing print ads announcing new Starbucks drinks and holiday gift cards, the New York Times became the sole newspaper sold inside Starbucks. To compete with Dunkin’ Donuts, Starbucks temporarily sold the popular Krispy Kreme doughnuts inside select Starbucks stores. The relationship ended after Krispy Kreme announced its own line of espresso beverages. In 2002 the North American Coffee Partnership, a joint venture between Starbucks and PepsiCo, released its first television advertising campaign, which promoted bottled Frappuccino and Starbucks DoubleShot drinks. The campaign included print ads, four 15-second TV spots, and one 30-second spot.

Commercials for ‘‘Loosen Up a Little’’ first aired during Labor Day weekend in 2000. In addition to television spots, the $60 million campaign included radio, outdoor, and print advertisements. One of the campaign’s lead creatives, Marty Donohue, explained in an interview with Adweek that the campaign aimed to brand Dunkin’ Donuts as ‘‘little comfort zones. Not a serious place, but a place people go every day’’ to escape the stressfulness of life. Donohue and Foley led a team of 12 copywriters and art directors for ‘‘Loosen Up a Little’’ and hired the acclaimed commercial director Noam Murro of Biscuit Filmworks to direct the spots.
One of the first spots featured a man who took advantage of being stuck in a traffic jam by leaving his car to fetch a Dunkin’ Donuts breakfast. ‘‘The work probes a little deeper into the human condition than previous Dunkin’ ads, while retaining the humor and freshness of the earlier work,’’ Foley told Adweek. Storylines for the commercials were created from the agency’s ‘‘honest assessment’’ of real-life customer experiences, he added. In a television spot titled ‘‘Smile,’’ two obnoxious business executives discussed a meeting that was taking place later that day. ‘‘I am stoked. Locked and loaded,’’ the more brazen of the two exclaimed. The bus lurched, and a woman standing behind the man accidentally smeared Dunkin’ Donuts cream cheese on his jacket. ‘‘Hey, why don’t you watch yourself,’’ he snapped. The woman then appeared to scrape the cream cheese off his jacket. When the man exited the bus, however, it was revealed that she had only shaped the cream cheese into a smiley face.
Later in the 2000 holiday season another spot featured Christmas carolers trying to eat doughnuts while singing. By the spot’s end their words had become unintelligible. Commercials aired on network channels during the season premieres of shows such as ER, Friends, and Law & Order. The campaign targeted what advertising critics referred to as ‘‘stressed-out urbanites.’’ Posters promoting Dunkaccinos and the chain’s ‘‘Coffee by the Pound’’ offering were posted inside elevators of 69 East Coast office buildings. To target Boston’s expanding Latino community, commercials were rereleased with Spanish voice-overs across Spanish-language television networks.
In 2001 the campaign targeted what the creatives from Hill Holliday referred to as the ‘‘regular guy.’’ ‘‘Peel-and-win’’ stickers that allowed participants to win sports-fantasy prizes were placed on Dunkin’ Donuts drinks. Prizes for the promotion included opportunities with athletes from six of New England’s professional sports teams. One prize offered several hours of soccer coaching from Kristine Lilly of the Boston Breakers. Another prize included the ice-hockey captain Joe Thornton of the Bruins delivering coffee and doughnuts to the winner’s office.

Advertising critics, Hill Holliday, and executives from Dunkin’ Donuts all considered ‘‘Loosen Up a Little’’ to be a success. Dunkin’ Donuts exceeded $2.7 billion in sales for the 2001 fiscal year. It also posted a 7 percent sales increase for the beginning of 2002, outperforming the collective growth rate of 3 percent for the entire quick-service-restaurant industry. Overall sales for Allied Domecq, the owner of Dunkin’ Donuts, jumped from $3.8 billion in 2000 to $5.2 billion in 2002. The campaign also collected a variety of awards at the 2002 Hatch Awards, which recognized New England’s best ad campaigns. Unfortunately for Dunkin’ Donuts, the campaign ended prematurely in August 2002. The company’s executives deemed the tagline ‘‘Loosen Up a Little’’ too irreverent in the wake of the September 11th terrorist attacks.
When Dunkin’ Donuts began its ‘‘Just the Thing’’ campaign in August 2002, creatives at Hill Holiday explained the shortcomings of the ‘‘Loosen Up a Little’’ campaign to the Boston Globe. ‘‘The problem was, though, you had to spend half your 30 seconds talking about how hectic life was. You had to explain it and set it up. That left us with only 15 seconds to talk about the product. ‘Just the Thing’ gets to the point quickly,’’ Marty Donohue said. ‘‘It’s wonderfully simple and you get it right off the bat. It’s so perfectly Dunkin’ Donuts. The new tagline is as comforting as a doughnut and a cup of coffee.’’

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