Dunkin’ Donuts Seeks The Gifts of Giving

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Born in the 1950s in Quincy, MA. Dunkin Donuts has become an international presence. Despite the chain’s name, though, the lion's share of its revenue comes from serving coffee. The company began reinforcing its caffeinated beverages sales in the mid-’90s. This was likely driven in part by the growth of a more upscale rival that had begun some 25 years earlier on the West Coast: Starbucks.

Both companies now have global reach. But long before they began pushing into markets such as China, they entered the digital world. As is the case with many restaurants, though, mobile has opened up a large number of opportunities that weren't as effective on the stationary web -- features such as instant coupons and of course, payments. Indeed, Starbucks has been a mobile payments pioneer in the U.S., enticing customers to fish smartphones out of their pockets and launch apps to have barcodes scanned before the advent of systems such as Apple Pay and Samsung Pay.

Apptopia’s Monthly Average Users shows that the monthly average users of the Munchkin maker’s current Android app -- launched in mid-April -- has been neck and neck with that of Starbucks’ Android app at about 7 million since early August, after eclipsing it earlier in the summer. The company launched on-the-go ordering in mid-June and -- perhaps more significantly -- launched cold brew coffee to its menu at the end of that month.

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Google Play Monthly Average Users of Dunkin’ Donuts and Starbucks apps, Worldwide, Source: Apptopia

Both coffee destinations have adopted app features such as loyalty programs and advance ordering. Dunkin Donuts is beginning to experiment with digital gift card purchasing. Distributed through Facebook, e-mail or SMS, the capability may drive marginally more near-term revenue. However, they also allow Dunkin Donuts to drive viral app adoption and potentially develop new loyal customers. If the gifting function proves popular, it could lead to the kind of January usage spike Starbucks enjoyed in January as gift recipients cashed in.

While we’re likely not seeing the origins of what could become Coffee Crush Saga, there's also the potential to drive further incentives that involve influencing friends to take other actions, similar to the way social games reward promoting activities.

AuthorRoss Rubin