How Krispy Kreme Spreads the Word Without Spending Much Money (and How You Can Too)
I wrote this article several years ago. It was never published and it’s a little outdated (Krispy Kreme has since gone through some rough times), but these examples of word of mouth marketing hold up pretty well.
Krispy Kreme is everywhere. Glowing articles about the company’s success frequently appear in major publications like the Wall Street Journal and Business Week, new store openings are regularly featured on local television newscasts, and many of us regularly hear the name spill from the lips of glaze crazed co-workers and friends.
It would seem obvious that Krispy Kreme, like most market dominators, has spent a lot of money marketing itself to achieve such widespread brand recognition and product awareness. Only it hasn’t. To hear them tell it they haven’t spent a single dime.
“We spend no money on advertising and no money on public relations,” said Joe Morgan, president of Krispy Kreme New York/New Jersey, in a recent press release.
Considering Krispy Kreme sells over 2.7 billion donuts a year (or over 7.5 million every day), you may find it hard to take Morgan at his word. In the book Making Dough: The 12 Secret Ingredients of Krispy Kreme’s Sweet Success, author Kirk Kazanjian points out that Krispy Kreme’s annual advertising budget is less than $100,000. That’s next to nothing compared to other equally successful brands like McDonalds and Target which spend tens of millions of dollars on high-concept advertisements, Web sites, and radio and television commercials each year.
So how does Krispy Kreme generate millions of dollars in free publicity and billions of media impressions annually (yes, billions again) while spending relatively little money on advertising and PR?
Simply put, they know how to spread the word.
The Krispy Kreme marketing strategy is not extraordinary. In fact, it is deceptively simple: create word-of-mouth programs at little or no cost to generate free publicity. But it is Krispy Kreme’s absolute mastery of this basic marketing technique (word-of-mouth, spreading the idea virus or guerilla marketing, whatever you want to call it) that sets it apart and, arguably, has helped it become such a runaway success.
So what, exactly, do these word-of-mouth masters do and how do they do it? Read on for some examples of their more effective strategies. While there are no guarantees they’ll make your business the next Krispy Kreme, you just might find a few ideas that will help increase word of mouth about your own products.
Spreading the word the Krispy Kreme way:
Give a Little More Than Expected
Stand in line at any Krispy Kreme store and odds are within minutes an employee will ask if you have ever had one of their donuts. Regardless of your answer, they will offer you a free one while you wait. A whole donut, mind you, not just a piece. And you will gladly take it. You know you will.
Giving a little more than expected is a memorable way to reward existing customers. It is also an effective way to introduce new customers to a product, encourage larger purchases than intended and, most importantly, get customers talking. That is a lot of bang for the donut and definitely worth the cost of a larger than normal sample.
But there is also another more subtle and, arguably, more effective strategy behind the free samples…
Give Them a Secret to Spread
You will probably be offered a free donut only when the red neon signs that say “Hot, Now, Krispy Kreme Original Glazed” are turned on. And the signs are only turned on when fresh donuts are rolling off the conveyor belt, usually in the morning and again in the afternoon.
Krispy Kreme does not promote this little secret. You’ve either got to experience it yourself a few times to figure it out or someone has to tell you about it (like reading about it here). And once you know about it you’re probably going to clue in a few buddies who, in turn, will come in to get their free donut, maybe buy a dozen or two, then tell a few of their friends about the sweet deal. The cycle repeats itself over and over again every time someone discovers or shares this little secret.
Influence the Influencers
Prior to its grand opening, a Krispy Kreme store will give donuts to just about every local community and business leader it can find. Sure, this strategy falls under the Give Something Away category, but there’s more to it than free donuts. What they are doing is exposing influential, highly connected people to their product and, hopefully, creating a few well placed fans whose social position allows them to spread the word to a large segment of the community.
A side benefit of this strategy is a phenomenon psychologists call “social proof”, the monkey-see, monkey-do behavior we all exhibit when we see someone else do something, thereby giving it an unspoken seal of approval. “Hey, if those donuts are good enough for the Mayor, I gotta check ‘em out!”
Show Them How Good You Are
Once you heed the glowing red signs and walk into a Krispy Kreme store, you know you are not in a typical donut shop. As you enter you will see a giant glass wall directly in front you and on the other side an assembly line worthy of an old Warner Brothers cartoon, complete with an assortment of conveyor belts, dipping tanks, and chain driven platforms. It is known as the Donut Theater and it is quite a show.
The purpose of the Donut Theater is not only to entice waiting customers with hundreds of donuts in various stages of creation, but to show that the Krispy Kreme experience is far beyond that of the typical mom and pop donut shop. Krispy Kreme is good and they know it.
It would be easy enough for them to say they are the best, but they are going to show you how good they are at making donuts, from the beginning of the process to the end when the hot donuts roll off the conveyor belt and a worker hands them to you. The result is an experience like no other, and that alone makes it something people will talk about.
Make It Newsworthy
When it comes to getting their name in the news Krispy Kreme likes to think globally and act locally. Individual stores have been known to supply donuts to rescue and disaster relief workers during times of crisis, hand them out freely to past and present members of the armed forces, and help with local fundraisers, all newsworthy events, locally speaking, and they generate a fair amount of local news coverage that way.
So what is the global part? It’s a matter of supply and demand, really. The major news corporations and their properties — cable news channels, USA Today, The Wall Street Journal, their accompanying web sites, etc. — are constantly looking for content. These national news services often pull stories from local sources.
For example, a recent Cops on Doughnut Shops fundraising program in the Atlanta metro area involving dozens of police officers camping out on the roofs of Krispy Kreme stores to raise money for the Special Olympics made the local news. Not surprisingly, several of the big cable news channels picked up the story and it became national news too.
Appear in enough local newspaper articles or broadcasts, the thinking goes, and you may eventually gain some free national exposure.
Be Media Friendly
In media circles Krispy Kreme has a reputation for being very easy to work with. Executives consistently respond to interview requests as soon as they can rather than putting them off for weeks. Often, the company will dispatch carefully trained PR personnel armed with, you guessed it, dozens of free donuts to answer reporter’s questions about the Krispy Kreme vision.
Giving reporters donuts may seem like shooting fish in a barrel from a marketing standpoint, but responding promptly to their inquiries with an abundance of company information is very smart.
Of course, the reporters are probably well aware Krispy Kreme is giving them the Treatment, but it is also making their job easier. And a reporter full of company facts (and donuts) is a reporter with a story that is already half written. That means a lot in their deadline driven world.
There you have it, half a dozen examples of inexpensive, if not downright cheap, word-of-mouth marketing that have helped one company become a market dominator. Taken individually they may not seem like much but, combined with a masterful touch and obsessive consistency, these word-of-mouth techniques have helped make Krispy Kreme a household name.
Now, get out there and spread your word.
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Adapted in part from Making Dough: The 12 Secret Ingredients of Krispy Kreme’s Sweet Success by Kirk Kazanjian. Several donuts were harmed in the researching of this article.
