Transportation

1
Bringing Krispy Kreme To Germany
Ian Constantine
Christianna Kopetka
Jay Snyder
Jenna Havemeister
Pierce Brehm
2
A History of Krispy Kreme

• Vernon Rudolph
• July 13, 1937 Winston Salem, NC
• Became so popular a hole was cut in the wall to
  sell to customers.
• 1950s Chain Stores were opened.
• Doughnut making equipment developed.
• 1976 store was sold to Beatrice Foods.
• 1980s-1990s began national expansion.
• 2000 Initial Public Offering
• Expansion to Canada, Mexico, U.K., Australia, and
  Japan.

3
Germany

• Close in size to Montana
• Total population 82,422,299
• 91.5 German
• 3rd largest automobile manufacturer in the world.
• Labor force in 2005 was 43.32 million people.

4
Country Market

• Economic Environment
• Average Household Income
• 30,100
• Western Germany
• High standard of living
• 8 unemployment
• Eastern Germany
• Lower standard of living
• 20 unemployment
• Service Oriented
• 71 work in service jobs
• Taxes are about 49 of income

• Cultural Environment
• Well Educated
• Highest literacy rate in the world
• 99.9
• Masculine Culture but feminine empowerment is
  high
• Individualistic
• Low on power distance
• Equality is important
• Middle class makes up 60 of population

5
Country Market

• Political and Legal Environment
• Very politically stable
• Parliamentary Democracy
• Leader can be voted out with a majority in
  parliament.
• Low risk country becoming more popular for
  foreign investment.
• Value Added Tax will increase beginning January
  2007 from 16 to 18.

6
S.W.O.T.
7
Segmentation

• Behavioral Segmentation
• Germans dont eat snacks and junk food like
  Americans
• Breakfast
• Light continental
• Brunch
• Kaffee
• Sundays 3-4 p.m.
• Only sweet items and coffee or tea served
• Karneval / Fashing and New Years Eve
• Jelly doughnuts served as tradition
• Bought in large quantities

• Market Segments
• Krispy Kremes strategy
• align itself with highly capable,
  well-capitalized and experienced food operators.
• Berlin is the most populous city
• 3.4 Million
• 41.4 are 18-44
• Germans are somewhat compulsive consumers
• savor the new, the offbeat, and the risky.
• Breakfast is not a major meal
• Breads
• Coffee and tea

8
Target Market

• Target Market
• 18-44
• Big Picture
• All those in search of a tasty bite for
  breakfast.
• More Specifically
• Young working class people that will spread a
  taste for doughnuts to the next generation.
• Three Groups
• Individuals on the go in need of fast service.
• 53 of people in Berlin are in the workforce
• Krispy Kreme is fast, fresh, and products are
  easily transported
• Groups that want a place to be social and eat.
• Groups looking for large quantities of doughnuts
  for specials occasions.

9
Market Potential
Fast food chains such as McDonalds, Burger King,
and the German Norsdee Gmph have had enormous
success in the quick service market.
Pastries are a favorite of German people, but the
doughnut is largely unknown. Other competitors
in baked goods are ABK, Bahlsen, and Dahli Kuchen.
10
Positioning Objectives

• Product Positioning
• Convenient and open early.
• Always have Hot and Fresh baked foods.
• The new and exciting food you have to try.
• Marketing Objectives
• Sell 18,000 doughnuts per day.
• Gain 10 of the baked foods market by January
  2009.
• Generate 1 Million dollars per store by January
  2009.
• To make Krispy Kreme the favorite sweet baked
  good in 2 years.

11
Product

• Branding Decisions
• Most product, packaging, and selection will
  remain the same.
• Considerations such as favorite fruits to make
  fillings will be accounted.
• Interior of stores will reflect a more modernized
  feel like that of other German bakeries.
• Will not use the 50s Americana approach such as
  in the U.S.
• Seating area will be designed for socializing and
  comfort, much like a Starbucks or Panera.

12
A New Look
13
Placement

• 10 Stores will be opened in Berlin area.
• Stores will be placed in high traffic areas next
  to major businesses or town centers.
• Franchise model will be used as in other stores.
• Franchisees must have 30,000,000 or 1,000,000
  per store to invest.
• Experience with quick service restaurants.
• Doughnut mixes and machinery will be manufactured
  in the U.S. and shipped
• to Germany.
• Delivered by sea to Hamburg, franchisee
• will be responsible for all freight and costs
• associated.

14
Promotion

• Promotion
• Trial is important!
• Local fairs, shopping malls, and businesses.
• Allianz Worldwide Insurance, Deutsche Bank Group,
  Deutsche Telekom, E.ON..
• Krispy Kreme will use German businesses for
  trials and to support the Krispy Kreme brand as a
  part of German culture.
• Signs and Posters
• Strategically placed ads to make the Krispy Kreme
  name a recognized business.
• Advertisements will be consistent with other
  humorous minamalist advertisements in Germany.
• Inspire curiosity and excitement through
  promotional events!

15
Price

• Prices will remain the same as in the U.S.
• Classic Glazed
• .56 Euros or .73 cents
• Specialty Doughnuts
• .64 Euros or .84 cents
• Coffee
• 2.29 Euros or 2.99
• With these modest prices we expect consumer taste
  to be the most important factor.

16
Questions