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Dunkin Donuts: How not to run marketing and communications strategy in China

|Includes:KKD, MCD, Starbucks Corporation (SBUX), YUM

By Ben Cavender

Last week I had a craving for donuts and I decided to turn to dependable Dunkin’ Donuts.  I hadn’t tried them out in China but since they are making a push to enter the China market and currently have 5 stores in Shanghai I thought I’d give them a shot.  My coffee and donuts were almost right and they satisfied the urge for a sugar and fat induced coma but the experience left me wondering if Dunkin’ Donuts is on the right track in China. 

Finding a Dunkin’ Donuts location in Shanghai was no easy task, first because their selection of locations is poor, and second because finding a corporate website with a list of stores is akin to the hunt for El Dorado.  

Typing “Dunkin’ Donuts China” into Google yields one corporate press release on page one but no Dunkin’ Donuts China website at least through page 8 at which point I got bored.  The search term “Dunkin’ Donuts Shanghai” was marginally more successful, page 7 coughed up a web address with a domain that I didn’t even know existed.  Usually in China websites end in .cn or  Imagine if McDonald's 

corporate website was mcdonalds.ny.usa.&nbsp

Searching in Chinese was more successful, the first link on Baidu for “唐恩都乐”  took me to (  It is unclear exactly what the purpose of the Jinti site is, and it still doesn’t relinquish store locations, but it is about Dunkin’ Donuts and does link to the site if one looks long enough and has good eyes. 

From a marketing standpoint the problem here is that Dunkin’ Donuts has very little brand awareness among Chinese consumers.  Most of their clients in China are foreigners.  So any foreigners who are interested in a donut have to rely on blog posts or word of mouth to find a store, searching for the company site is too hard.  At the same time Chinese consumers don’t know what Dunkin’ Donuts is so expecting them to know the brand name in Chinese is asking a lot.  A domain also makes no sense because it is not a common search string that a savvy internet user would pick as a possible address, it also makes Dunkin’ Donuts look like a small time operation in China that is city based.

The Dunkin’ Donuts’ Shanghai site does list store locations with contact information and maps so they did that well but the site has other issues.  Clicking on the contact us button does nothing other than offer an email address, to a address.  Dunkin’ Donuts must be hurting if they can’t spring for an email address that at least matches their domain. 

I finally found a store, though the locations are all fairly inconvenient, especially compared to brands like Starbucks that have made an art of positioning their stores in high traffic areas, and I’ll admit that I enjoyed the coffee and the donuts, especially the chocolate glazed.  The 2 other foreigners in the store also seemed to be enjoying their snacks and their free wireless.  I’d have asked a local what they thought of the place, but I couldn’t find one.  One might argue that donuts don’t appeal to Chinese consumers which is why Krispy Kreme failed in Hong Kong but this isn’t true.  The same weekend I also had a look at two alternatives Mr. Donut, and Donut King, and couldn’t get a seat at either. 

If Dunkin’ Donuts is going to be successful in China, and I hope they are, they need to learn from the competition. 

Starbucks, which has roughly 350 stores in China in 26 cities, has done an excellent job of cementing their position in the market but they haven’t always been so successful.  When Starbucks (NASDAQ:SBUX) first came to China via Beijing they didn’t really generate consumer interest.  Only after they rebooted in Shanghai and worked to localize their products did they start developing a following.   

Starbucks is successful because they have done a good job of emphasizing teas, non coffee beverages and food; Chinese consumers try coffee but will often preferentially order tea beverages.  They have also made Starbucks a destination rather than a waypoint.  In the US 70-80% of Starbucks’ business is to go, in China more customers want to stay.  To compensate Starbucks increased seating.  In response to flagging demand due to the economic slowdown Starbucks also recently introduced more Chinese food options. 

In addition to in-store changes Starbucks and other companies like McDonalds (NYSE:MCD) and KFC and Pizza Hut have also done a good job of developing interesting digital marketing campaigns, important when one considers that there are 300 million Chinese online and that the internet is the dominant form of entertainment and information in their lives.   

Starbucks recently partnered with iPartment ( to target young affluent women.  The site which allows users to design virtual apartments has 14 million registered users who are predominately female, white collar, and under the age of 40.  Prior to the opening of a real store Starbucks created a virtual store online and users were shown signs by their virtual homes advertising the opening.  By visiting the virtual store they were given the opportunity to take part in promotions that gave them vouchers and free gifts on opening day, driving customers to the store.  Starbucks also has a regular web address ( 

If Dunkin’ Donuts is to be successful in China they need to make some marcom changes fast.  Their website needs to be findable, as do their stores, and they need to find a way to connect with Chinese consumers online and provide a compelling reason for customers to choose their food over the competition. 

Ben Cavender is a senior analyst with the China Market Research Group (CMR), the world's leading strategic market intelligence firm focused on China.

Disclosure: none