NEW YORK — The economic outlook for 2009 may be sour, but Dunkin’ Donuts thinks its prospects are sweet.
The coffee and food chain expects to weather 2009 and keep the heat on rivals such as McDonalds and Starbucks. Coming are a new CEO, more value offerings, more stores and more marketing, with spending up more than 5 percent, led by a $100 million ad campaign starting Monday.
“It will be a difficult year economically but I think we’re well-positioned,” says Will Kussell, president and chief brand officer. The chain has 5,769 U.S. stores.
Dunkin’ recently scored a symbolic win in Congress against Starbucks, which is undergoing a $400 million revitalization plan. As of Dec. 18, thanks to a concession change, Dunkin’ bumped Starbucks as the official coffee of the Senate restaurant.
Dunkin’ spent much of 2008 re-emphasizing the basics, such as service speed, after seeing a dip in sales. “We started to see a little bit of a downturn in the early part of ’08, particularly in Florida. That was the leading indicator for us,” says Kussell.
The introduction of flatbread sandwiches, which now makes up 5 percent of sales, and Dunkin’ Deals has helped set the stage for an aggressive 2009, including:
— New ads. “You Kin’ Do It” is the theme for TV, online and outdoor ads that highlight everyday challenges, such as work and traffic. “You Kin’ Do It … says we’re going to help you get through what you have to deal with every day,” says Kussell.
Also on tap: more online social networking action, such as blogger Dunkin’ Dave on Twitter.
— New CEO. Nigel Travis, 58, takes the top job Tuesday. Travis, former CEO of Papa John’s, has franchising and global experience from stints with Burger King and Blockbuster. Dunkin’ opened its first store in China last fall and Travis is expected to focus on global growth.
— New stores. Kussell would not say how many stores Dunkin’ will open in 2009 but says it will continue its westward expansion with stores in Indiana, Arizona and Nevada. In 2008 Dunkin’ opened 500 in the U.S. while Starbucks said it would close 600 of its 11,000 in the United States.
— New value meals. Dunkin’ will expand Dunkin’ Deals, which bundled a bagel or sandwich for 99 cents with purchase of a coffee. “It’s been huge in this economy,” says franchisee Jim Allen, who owns 18 stores.
In the first quarter, a flatbread sandwich, typically $2.99, will go for $1.99 with coffee purchase.