A Look at The Diverse Suggestions to Enhance The Gratification of Customers at Dunkin Donuts

It took us time to decide which company to ultimately help improve, but after extensive research, we felt that Dunkin Donuts was a company in a competitive industry that we could do further research on. It became obvious that they are one of the top 3 brands when it comes to coffee but there was still room for improvement. In order to further explore this, we wanted to analyze a sample to better understand what current coffee preferences were. This is what our first survey set out to do. As you’ll see we ran into some expected biases based on the available resources we had and who we would be able to reach out to. The survey did give us a better understanding of where the Dunkin Donuts brand ranked, especially among our fellow college students. Going beyond that we were able to limit what areas of the business we would have to focus on for our next piece of research. We saw that Dunkin Donuts was convenient, price-sensitive, and that quality was more of a subjective measure and was going to be difficult to measure. This led us to focus on the interior layout and design aspects of Dunkin Donuts. Reason being was that it was the sole thing that our respondents couldn't agree upon. So we made the focus of our in-depth research in-store layout preferences. We gave 18 different combinations to rate their preference on. After this survey we were able to determine that consumers cared more about comfort than appearance. Taking all the research we did, from preliminary to more in-depth we were better set up to determine our recommendations.

Introduction

We set out on this research study to better understand how we could increase sales and market share for Dunkin Donuts as a company. It was going to take preliminary research to understand Dunkin Donuts place in the market but also more in-depth research to have a more specific answer to how we were going to achieve these results. This study was needed because the status quo isn't always good enough and if Dunkin Donuts was going to increase its sales and grow its presence in the marketplace we needed some answers from real coffee consumers. When it came to the scope of the study we were slightly limited but also able to focus upon one of the largest demographic of coffee drinkers in fellow college students. For this research we had no funds and excess resources beyond Google forms. In terms of reaching out to respondents we each targeted our fellow college students. This was free and most fellow students were more than willing to help when it came to filling out a quick survey with no incentive. The problem with this form of research and sample it can create a potential bias and limit how large it can be scaled out. This is so important because when it comes to making a large scale marketing decision further research would need to be done at larger scale that can better represent all the regions that Dunkin Donuts is located in. It would be far too risky to take the research we’ve done and allow that to represent the entire coffee drinking population in the United States. The positive thing though when it comes to make a marketing decision is that Binghamton University can be used as a sample to better represent opportunities within college campuses. There is risk that comes with any research but if the information we provided is used correctly it could still be a huge way to possibly help increase sales and grow Dunkin Donuts overall market share within the coffee industry.

The primary sampling technique we utilized throughout our research was convenience sampling. Though not the most ideal sampling technique, we chose to use convenience sampling to achieve results quickly due to the time and monetary constraints. To remain within certain due-dates for this project, convenience sampling seemed to be the most appropriate method to gather as many respondents as possible in a small time-frame. Convenience sampling predominantly had us reaching out to those who were directly connected to us in one way or another. Our sample size came mostly through classmates, requests through social media websites and by asking friends and family for their contributions. The downside to this sampling technique is that it can lead to certain biases and it is not completely representative of the population as a whole. Our sample size included mostly college age adults who may have different opinions towards our research subject as opposed to older and younger generations. Additionally, given that our sample knew they were being asked about coffee, there is a possibility that there was a self-selection bias at play as well.

Had time and money not been a limiting factor for our research, the most ideal sampling technique we would have implemented would have been simple random sampling. Given that with this sampling technique each member of the population has an equal chance of being selected, it is the best sampling technique to use to gain insight into the opinion of a population and prevent the possibility of certain selection biases. Our research attempted to discover how the population felt about Dunkin’ Donuts, and therefore simple random sampling could have provided more conclusive and effective results.

Our key data collection method for this study was through the use of surveys. Specifically, we used the online survey resource Google Forms to create and distribute our surveys. We utilized this method of data collection because, similar to our use of convenience sampling, it was the quickest and most inexpensive method of reaching the largest number of people possible. Within a few days, we were able to receive 66 responses to our first survey and begin our analysis. The limitation of this research method was that there was little to no opportunity for feedback from the respondents and no opportunity for follow-up questions or clarification. Though we did include an open ended question and the included an “other” option for certain questions, overall the responses we gathered were limited to the options we provided.

If we had additional time and resources for our study, we would have liked to perform

additional surveys based upon the responses we received and possibly conduct a focus group as well. By employing a focus group for our research, it would have allowed us to achieve this personal feedback from our respondents and follow-up with further questions to benefit our research.

The kinds of information we attempted to address through our research was the brand perception of Dunkin’ Donuts. In the first survey we focused on many different aspects of Dunkin’ Donuts to narrow down some of the key issues with how customers perceive their brand. In our second survey, we focused on how their perception could be improved through redesigning their in-store decor.

In analyzing the first survey, we primarily used Google Form’s own summary function to review how individuals responded to our survey. This broke the responses down into different percentages and allowed us to easily analyze the data. For the second survey we conducted, we performed dummy coding for the responses to discover which decor layout was most preferable. Following this, we ran a conjoint analysis and regression analysis to further analyze the significance of the results.

Research Results

In the beginning of the semester, we gathered information from a survey about consumers’ coffee buying and drinking behavior. We wanted to figure out what Dunkin’ Donuts could do to improve their sales, their spot against competition, and their customers’ perception of the brand.

Coffee Consumption:

Of our responses, we found that 81.5% of our responders drink coffee, meaning that only 18.5% say they do not drink it at all. Half of the people who said they do drink coffee, said that they drink it every day. Just over 30% drink coffee at least once a week, if not several times in a week.

Coffee Brand Consumption:

Within this first survey, we then moved on to ask the coffee drinkers where they purchase their coffee, what brands they choose, and why.

Almost 40% of the responses told us that people make their coffee at home, rather than buying it out in public. We will get back to that in a minute. About a quarter of responders said they buy their coffee at Starbucks, Dunkin’ Donuts following them at about 17%, and then the remaining shoppers tend to make their purchases at local coffee shops.

We asked those who brew their coffee at home, what brand of beans they decide to purchase and to look at customer brand preference and loyalty. Only 17% of those surveyed used Dunkin’ Donuts home-brewing coffee. About 40% of those surveyed chose another brand we gave as an option, and the remaining 42% chose “other”.

Specific Dunkin’ Donuts Questions:

The surveyors gave a 67% response to stopping at a Dunkin’ Donuts only once a month. or even less. That leaves only the remaining 33% to go once a week or more. About 43% of our responders said that they would choose Dunkin’ Donuts over other brands strictly for convenience. That’s almost half, which only leaves a quarter of them to choose the brand for price, another quarter for quality. Not a single respondent chose the brand for their in-store atmosphere.Yet, quality was rated at a 4 out of 5 when we asked, and over a third of respondents said they would be willing to pay more for the coffee if the quality also increased.

What does that mean for us?

Dunkin’ Donuts is clearly convenient, which is certainly a positive when looking at the brand. According to the survey answers, Dunkin’ Donuts prices their products well. Yet, we need to understand what the can do better. It’s evident that their quality of coffee can be improved, but the quality is subjective. People’s opinions won’t always be the same toward a product. However, the one piece here that every respondent seemed to agree on was the in-store atmosphere. Not a single person we surveyed agreed on that.

Based on this information, we decided to do our in-depth research on the in-store atmosphere and decor of Dunkin’ Donuts. We thought that if we could find people’s opinions on that, we could get a better understanding of the general perception of the brand and increase sales. With the atmosphere being the attribute that we received zero positivity for, we think learning more in-depth information about it can help to increase the Dunkin’ Donuts image.

For the in-depth research we decided to ask respondents about the wall color, the flooring, and the chairs and couches. We gave a total of 18 different combinations of the three and asked the respondents to rate them, only on a small scale of 1-5. You can find the exact data in the appendices at the end of the paper.

It became clear to us through this survey that people tend to care more about their comfort than the appearance, or at least they say this on paper. Combinations that included more comfortable, fashionable furniture, hardwood flooring, and beige walls tended to score higher. Options that included carpet, less comfortable and attractive furniture were rated much lower; typically at only a 1 or 2. After gathering data through this survey, we ran a conjoint analysis and regression on the data to better understand what would most help Dunkin’ Donuts.

Before looking at the p-values and coefficients of all of our variables, we looked at the R Square, which is .507. This means that the survey data realistically only helps our understanding of the improvements on Dunkin’ Donuts interior only about 51%. According to the regression analysis, beige-colored walls, plastic with metal chairs, and hardwood floors had 0 in place of their coefficients. That means that they were the most significant variables in the combinations. Grey walls, wooden chairs, tiled floors and carpeted floors all had negative coefficients over .05. That means that they were neither significant nor made any true impact on the respondent's’ decision making.

Recommendations

Through the use of convenience sampling and surveying, our overriding, primary finding was a user preference for both convenience and a comfortable, in-store atmosphere at Dunkin’ Donuts. Whilst respondents by and large agreed that the quality of the product was good, none of them said they would choose Dunkin’ Donuts for its atmosphere. Furthermore, only 33% said that they visited Dunkin’ Donuts more than once a month, which is likely highly attributable to the perceived subpar atmosphere.

Because convenience is already a core competency for Dunkin’ Donuts, most of our recommendations based on our major findings will concern improving the in-store atmosphere. Because our survey results indicated that respondents prefer a combination of stylish and comfortable furnishing and atmosphere over the company’s currently cheaper atmosphere, we are recommending to management to remodel the interior of their stores to include modern furniture, hardwood, high-quality flooring, and neutral, pleasant wall tones such as beige.

We also recommend that Dunkin’ Donuts be cautious about future price increases. While respondents scored their current prices relatively favorably, pricing their products too much higher would put their prices in the range of coffee shops like Starbucks or boutique, independent coffee shops that sell on quality and brand status. It is likely that Dunkin’ Donuts would not fare well if they stopped competing on price and instead competed purely on product and brand quality.

Based on some of the worded, qualitative feedback we received in our surveys, we also recommend that Dunkin’ Donuts increase the standardization of its franchised locations. Specifically, customers expressed a desire for all locations to have drive-throughs, which is one of the few areas Dunkin’ Donuts could seriously increase its convenience. Furthermore, customers were dissatisfied with the standardization of their orders across different locations, indicating that their coffee orders were not the same, particularly in regard to the type and quality of the cream used. We strongly urge Dunkin’ Donuts to implement increased quality assurance measures to ensure that all customers receive the same experience so as to take any and all guesswork on the part of customers as to what the quality of their order will be like out of the equation.