Earlier today, as I was waiting in the train station on my way back to school, paying for my iced tea though Dunkin’ Donuts’ app, I realized how my relationship with Dunkin’ has changed and how much more frequently I spend money at Dunkin’ since downloading this app. Part of this is definitely because, living along Comm Ave, there’s one basically in my back yard. Otherwise, I think the app has had a huge affect on my spending habits and as such, I wanted to look further into the factors that have led me to use the app so frequently and how this has affected Dunkin’s business. (Side note before we get into this: many companies have apps like this that yield similar results. Starbucks, one of DD’s largest competitors, has a very similar and successful app. For the sake of this blog post, I will be focusing around Dunkin’s app because it’s the one I use most frequently.)
Undeniably, one of the largest benefits of using the Dunkin’ app is the mobile ordering feature. The amount of “I’m running late, but…” coffees that I have justified by ordering on my way to pick it up is honestly a little embarrassing as well as kind of impressive depending on how you look at it. By capitalizing on speed, convenience, and accuracy through mobile ordering, businesses like Dunkin’ can optimize customer relationships and maximize frequency of impulse buying. Dunkin’ has always been relatively fast and convenient – there’s one on most corners of all of the major northeastern cities and one or two in every smaller town and all of them run like well oiled machines. With mobile ordering, they can get ahead of busy times and become faster yet. Also, by more or less completely removing all human interaction, you can improve accuracy by essentially ruling out all human error. One time I went to get a coffee during a networking call while talking on the phone to someone, which was fine because I knew I wouldn’t have to talk to anyone in the store. Additionally, I’ve had orders messed up because people have misheard me (I definitely ordered coffee with skim, not cream, but it’s fine). Needless to say, I’ve become a big user of the mobile ordering feature.
Payment and Rewards
One of the main features of the DD app is the ability to pay through the app. This makes payment very easy and relatively guilt free (except when you have to reload). But for someone who reloads in $25 increments, like me, that’s only guilt every 10 coffees or so. For me, one of the biggest perks is how easy it is to rack up rewards. Whether by shopping at different times or ordering online on certain days, I will plan my trips around gaining extra points and getting a “Free Reward Beverage of Any Size!” Earlier today I got one, and I will probably go out of my way to use it this week, buying a coffee larger than needed, just because I can. It’s a known fact that people like free things, and I think that increasing the amount of free things and other rewards that you give your customers is a great way to increase brand loyalty and improve customer experience (speaking as a customer who appreciates receiving free things in return for loyalty).
Dunkin’ Donuts released their app in 2012. Originally it served as a platform only for payment and sending and using gift cards, but has since come to include the DD Loyalty program, mobile ordering, and many other features. Considering that market movements are natural and that DD is doing other things to improve their business model, like simplifying and streamlining their menu options, and acknowledging that Dunkin’ Brands also owns Baskin-Robbins and other companies, Dunkin Brands Group Inc’s stock (DNKN) has made a significant improvement since the release of the app in 2012. The stock was at a low of 24.58 in December 2011, and has climbed to a high of 68.18 in January 2018. As I said before there are obviously too many factors to claim that this is because of the app and the way it’s changed its relationships with customers, but I do think this is a large factor in improving their business model.
Going forward, I think that with regular updates and new features to stay with and ahead of the competition, apps like this will continue to benefit Dunkin’ Donuts and other brands who employ them. For now, I’ll just enjoy my free large coffee.