…all for the want of a donut: Krispy Kreme and “no more free samples is Stupid Marketing”
There’s an old nursery rhyme that goes:
For want of a nail the shoe was lost.
For want of a shoe the horse was lost.
For want of a horse the rider was lost.
For want of a rider the battle was lost.
For want of a battle the kingdom was lost.
And all for the want of a horseshoe nail.
I wonder if Krispy Kreme marketing execs have read that rhyme lately.
Why do I ask? Because the Krispy Kremes in my area recently (quietly) ended their policy of “if you see the “hot” light on, and come in to the store, and ask for a free sample off the line of original glazed, we’ll give you one!”.
Now, I have to wonder: what’s the variable cost of a single donut? It can’t be that high – and the day I learned about the policy change I watched at least 3-4 dozen being thrown away because they were too brown / not up to QA standards.
Add in the statistical likelihood of the “hot” light being on (I believe that happens 2-3 times per day, for about an hour?) and the odds of someone being in the store, and knowing enough to ask for a sample – well, gosh, I expect that the free sample policy must have cost them at least fifty cents per store per day.
Wow.
That does sound like lots of money.
Especially when you consider that the marketing budget for those stores (for, let’s get this right, encouraging positive associations, luring in customers, and getting them hooked / buying more donuts) has got to be at least a few tens of dollars per day.
[Oh – and for you cynics – if you really don’t believe the cost numbers, alter the policy to state that if the hot light etc is on, you get a free sample after purchase, or at your next visit, all other terms unchanged. Simply ending it seems like the worst sort of stupid, shortsighted marketing.]
Loss of goodwill. Bad PR. Grumpy customers.
All for the want of a donut*.
*contrast the Krispy approach with that of Zappos. Guess who’s winning more business and getting better PR, for less money?
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UPDATE - 1 WEEK LATER
So, being a complete wiseguy, I dropped an email to Krispy Kreme, pointing to this entry and suggesting that they were doing the wrong thing.
They must be getting a lot of email, as I was sent the following canned response (which earns big points for length...)
Dear Mr. Epstein,
Thank you for your email regarding the free sample policy. We appreciate the time you took to share your feedback.
Over the last few years we have tried several different sampling promotions at company owned stores. We had been running a promotion to increase awareness of our Original Glazed doughnut. We have received feedback from our customers who feel that they are familiar with our signature product, the Original Glazed doughnut. Therefore, we have revised our promotional samples in an effort to continually share the Krispy Kreme experience by utilizing sampling to promote awareness, trial and purchase of new products throughout the year. Information on which products will be offered for sampling purposes and at what times during the day can be obtained by contacting your closest store.
Thank you again for your email and we look forward to serving you again in the future.
Best regards,
Carlos Rodriguez
Krispy Kreme Customer Experience
I find this answer wildly amusing -- for two reasons.
First, of course, is that it chooses to call a long-standing policy (named as such in the first line, has been running at my local store for years and years) a "promotion". Sure it is, guys.
Secondly, they fall back on the classic "Customers have told us..." line. Why is it I don't believe any customer ever told you "why, golly, yes, we'd be much happier without a free sample?" I mean, that's my point -- familiarity combined with the randomness of the HOT sign being on is (was) immensely powerful. Variable reward is the most powerful form of reinforcement -- check out Robert Cialdini and 30+ years of research on the topic. By the way, the people at the local store looked at me like I was insane when I asked them for "information on which products will be offered for sampling purposes". The counterperson very gently said "none will. it's over. we're sorry. we don't understand it either."
Last, but not least, of course, is what's actually being said in the letter. In case you missed it, here it is in a sentence.
The answer to my comment "Krispy Kreme is foolishly eliminating one of the best marketing policies they had, the zero-cost / high ROI 'free donut' policy" is... (drumroll please)
..."Krispy Kreme isn't eliminating the policy; we never had that policy in the first place!"
Please, Krispy people, tell me you didn't just say that. Really. That would be a hall of fame moment for StupidMarketing. Truly brilliant defense of the action, there, Carlos.
Somehow, I suspect they won't be sending me any free donut coupons for this observation and feedback...
Ah well, I tried.
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[ps: Please buy my book. http://buynow.stupidmarketing.com -- and tell your friends!]
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Great point Kevin! Definitely a foolish decision. It alienates the loyals who are aware of it. It reminds me of "Three's a crowd" and a Bank policy of "more than 5 minutes in line and we'll pay you 5 dollars" both of which were either dropped or neglected. It drove me to look elsewhere for a company which would follow through on its promises. www.AnimalAbatementSpecialists.com
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I think they might have pulled the free sample not because of the cost of the doughnuts they gave away, but of the cost of having that light on several times a day!
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