Saturday, May 29, 2004

Krispy Kreme Doughnuts

Have you ever wondered why they're spelled "dough"nuts?
dough Noun
1) (food) a flour mixture stiff enough to knead or roll
2) (possession) informal terms for money
Synonyms: shekels; gelt; bread; dinero; lucre; loot; pelf; moolah; cabbage; kale. (SlovoEd 4.13 - dictionary for Palm)
Krispy Kreme (finally!) opened it's first store in the Central Business District in Sydney on Wednesday. The first customer was to receive a year's supply of doughnuts. As it was raining the night before the store's opened, chances are they were looking forward to a hot cup of coffee and a warm shower as well!)
My partner's boss dutifully joined the queue yesterday to buy a half dozen original glazed doughnuts - only to find they were selling for $1.90 each - or $11.40 for 6; he decided the 12 for $11 was a better deal.
What are the ethics of marketing, effectively, via bigger portions? There's a documentary just doing the rounds here ("Super Size Me") about a guy who, for a month, lived on McDonalds. I'm not sure whether this was before Maccas introduced their healthy menu items - or if he chose them if they were available - but the result is not something that's likely to have people eating there on a regular basis. It's also not likely to increase Maccas -or Krispy Kreme's -turnover unless they change their fare.
Krispy Kreme reported Tuesday that it lost $24.4 million in the first quarter, its first quarterly loss since going public in 2000.
Part of the loss was attributed to people deciding a more balanced lifestye (read: diet) is appropriate for them. Strategies to adopt to this changed and changing consumer environment include the company's doughnut shops selling a low-sugar doughnut, mini doughnuts and doughnut holes (!!!).
Scott Livengood, Chief Executive of the doughnut-maker said: "And we make our plans and do things in a, call it a worst case scenario. I think there is always a real possibility that people are going to decide a balanced lifestyle is appropriate for them ....
"But on the other hands we're not going to take anything for granted."

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