Oh Doughnuts Brand Strategy. Raegan Hedley. Marketing 3008 Thursday Class

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1 Oh Doughnuts Brand Strategy Raegan Hedley Marketing 3008 Thursday Class Oct. 8, 2015

2 Branding Strategy: Part One Overview My client is Oh Doughnuts, a gourmet doughnut shop opening a location on Broadway street in Amanda Kinden, the owner, makes the doughnuts and creates the recipes. Oh Doughnuts did a trial run in 2014 when she arranged to start selling doughnuts at some coffee shops in Winnipeg. Kinden then decided to put Oh Doughnuts on a hiatus until she had a big enough space to meet the demands of her customers until now. The Oh Doughnuts storefront will serve doughnuts, quality drip coffee, and will offer catering. During the trial run Oh Doughnuts built a solid social media following and received a lot of media attention because of the novelty of the product in Winnipeg. Since taking the hiatus, competition has emerged. Kinden still maintains the social media accounts, replies to comments, and appears in the media occasionally, but she hasn t focused on marketing in over a year. Oh Doughnuts would benefit from having a cohesive marketing strategy with a focus on building brand awareness, and differentiating the product in the customers minds. Research I conducted customer and competitor research, and this brand strategy is informed by those findings. I interviewed Amanda Kinden, did surveys of both potential customers and past customers (when she was doing the trial run), and gathered information from social media. Category Gourmet doughnut shops are just beginning to emerge in Winnipeg. These shops sell fresh doughnuts and premium coffee. They charge premium prices: doughnuts cost between $ $5 and coffee ranges from $2 - $5. They are locally and independently owned. Other markets, like Toronto and Calgary, aren t as new to this category and they already seen shops like Jelly Modern Doughnuts succeed and turn into a chain based on their popularity. Environment The most prevalent trends in this industry right now are novel flavours and aesthetically appealing products. Customers don t want something to just taste good, they want to be able to take a picture of it because it s a work of art and they want to make their friend jealous. Gourmet doughnut shops face a few specific challenges: slow production creating delays, doughnuts going stale fast, and supplies selling out quickly. As the number of millennials grows in Winnipeg (second largest segment of the population next to baby boomers according to a 2011 Statistics Canada Survey), more options for gourmet food and drinks will spring up to meet the demands of this group. This demographic is also more likely to spend disposable income on higher-quality products. This is a sustainable market in Winnipeg since there will be demand

3 in the next five years for products like this. There is also room for more competition to enter the market because this is still a novel category with few direct competitors. Brand Since Kinden did a trial run, she established a customer base, but fleshing out her brand wasn t her primary concern. She was focused on making the doughnuts and getting herself out there. With a degree in environmental studies, and knowledge from working for Green Action Centre, she gravitated toward sustainable and local ingredients. Kinden wants her doughnuts to be known for their freshness, and the range of new and creative flavours, in addition to the fact that they are made with the best local and sustainable ingredients. What also sets Oh Doughnuts apart is the attention to detail. Of the people surveyed who were unaware of Oh Doughnuts, their initial impressions were that the brand was appealing because of the flavours and trendiness, based on the Oh Doughnuts Instagram and Twitter accounts. Customers who have tried Oh Doughnuts before identified innovative flavours, freshness, and options (vegan/gluten-free) as aspects of differentiation for the brand. Four out of five customer s who had tried Oh Doughnuts before said they would visit the storefront when it opened, although most said not on a regular basis; the same four also said they would recommend Oh Doughnuts to a friend. Of the customer s who have tried Oh Doughnuts, most could recall details about what flavour(s) they had tried even though it was over a year ago indicating how this aspect of the brand creates a lasting and memorable impact with customers. Target Based on research, Oh Doughnuts past customers are tastemakers or foodies, primarily female, ages This group consists of early adopters, people who eat out a lot, people who spend a lot of time downtown, and people who use and follow social media. Women in this category are bloggers, mothers, and young professionals. They are influencers of the people around them and they have a desire to share their experiences with their friends. This group is highly motivated by being recognized and responded to on social media, and they use Instagram and Twitter the most. When Kinden opens Oh Doughnuts, she will be trying to capture the attention of business people working on Broadway and in the downtown core area. They are young urban professionals and senior professionals. This group responds well to deals, good service, referrals and advice from their colleagues, and office treats. They require motivation to alter their routines to incorporate a new ritual (coffee dates on Friday s), but a good experience means they are likely to go back and bring their co-workers. They are savvy and well-informed consumers, and they use a mix of Facebook and Twitter.

4 Competition Bronuts is Oh Doughnuts direct competition because they are the only other place in the city that offers fresh gourmet doughnuts and coffee. Bronuts is a non-price competitor in the premium doughnuts category because their pricing is similar to Oh Doughnuts. It is $2.75 for a doughnut at Bronuts and Kinden wants to charge $3 or 4 per doughnut, depending on the flavour. Tall Grass Prairie Bread Company is indirect competition because they don t sell doughnuts, but they do sell other breakfast treats like cinnamon buns and croissants with coffee, all made with local and sustainable ingredients. Tall Grass is competition in the catering market because both businesses target morning meetings and snack breaks. Fools & Horses, a coffee shop on Broadway, is a indirect competitor because they don t sell doughnuts, but they do serve coffee and lighter fare like gourmet toast, croissants, muffins and chocolate. They currently capture the same audience Oh Doughnuts wants to attract. They aim to be a zero waste business, by being as eco-friendly as possible. Tim Hortons is also an indirect competitor because they serve doughnuts and coffee, but they are not a key competitor because they don t hand make the doughnuts fresh, or use local and sustainable ingredients. Marketing Communications Social media is the most prevalent form of marketing Bronuts uses right now. They use it to promote things like their Le Burger Week collaboration with King + Bannatyne, and their seasonal flavours. Aside from these accounts, their website is nice, but very minimalistic, and it directs you to their Instagram page. In terms of PR promotion, their shop is blogger bait, and they have had some media coverage as one of the new businesses flooding into The Exchange District. Tall Grass is practically an institution in Winnipeg considering it s been 25 years since they opened their first bakery. Their new retail venture, Grass Roots Prairie Kitchen, was just named retailer of the year by Ciao! and they are in the Hot Shopping listings in Where Winnipeg, but they don t advertise in either publication. They have a fairly dated website, but they don t use any conventional marketing tactics because of the value their brand has built over time in Winnipeg. Fools & Horses uses social media to market their business, in addition to having a useful and sleek website. They ve promoted their business by aligning with the arts and culture community in Winnipeg and hosting events for things like ManyFest and Nuit Blanche, while promoting food and drink specials. They partner with Peg City Car Co-op on their shop local initiative as well.

5 Marketing Audit I am evaluating the key competitors marketing efforts using a scale of poor/nonexistent, fair/good, and excellent. Their websites are ranked on a scale of one to five, one being the worst and five being the best based on how informative and useful it is, the design, and how current it is. In terms of measuring social media, here s the breakdown: Poor/Non Existent followers, little to no engagement (likes, comments, conversations etc.) and posts about once a month or less. Fair/Good followers, some engagement, and posts content about once a week or more. Excellent followers, high volume of engagement, and posts original content on a daily basis, or more. Business Twitter 1.Followers Instagram 1.Followers Facebook 1.Likes Website Overall Marketing Effectiveness Bronuts 1. Fair 2. Poor 3. Fair 1. Excellent 2. Excellent 3. Excellent 1. Good 2. Fair 3. Poor 4 Good Tall Grass Prairie Bread Company Nonexistent 1. Fair 2. Fair 3. Fair 1. Poor 2. Poor 4. Poor 2 Poor Fools & Horses 1. Fair 2. Good 3. Good 1. Good 2. Good 4. Good 1. Fair 2. Fair 3. Good 5 Good Marketing Mix Bronuts has a strength in its location because the Exchange District is experiencing a surge of new restaurants, attracting people to the area. Their 15,000 Instagram followers and wellcurated page is another strength. Their weakness is the product. Bronuts has six pretty basic flavours, and the doughnuts aren t as visually appealing as they could be. Tall Grass has high quality products and has the advantage of been sold at their two bakeries in addition to other locations. Their weakness is promotion, because they basically don t do any.

6 Fools & Horses strength is their trendy food and coffee and their space (they use it to have events where they can tell beverages and food). Their weakness is their prices. A piece of toast topped with local toppings is $2 or $3 a slice, and their premium coffee is $3 and up. Competitive Goals Bronuts brand is youthful and fun, and doesn t take itself too seriously. They want to attract trendy young urban professionals and university age adults. Tall Grass is branded as being healthy for the environment and for customers, with the best possible local ingredients. They want to appeal to people who want to feed their family well, or adults who prefer purchasing locally made goods. Fools & Horses brand is a balance between modern, artsy and whimsical, all while being an eco-friendly. They want to target business professionals, both young and old, and artsy young people who care about being trendy (hipsters). Marketing Audit I will evaluate Oh Doughnuts online marketing based on the same scale as its competitors. Kinden said her initial strategy to market her business consisted of posting on social media, and getting as much coverage in the media as she possibly could. She did a good job of leveraging her media coverage to create buzz about Oh Doughnuts, even though she didn t have a storefront. She had a well built website, which is currently being updated to reflect the changes to the business. On the website, she had a media page with links to stories written about Oh Doughnuts. Oh Doughnuts received a boost on social media because all the coffee shops that sold her doughnuts promoted her social media accounts to their followers. Poor/Non Existent followers/likes, little to no engagement (likes, comments, conversations etc.) and posts about once a month or less. Fair/Good followers/likes, some engagement, and posts content about once a week or more. Excellent followers/likes, high volume of engagement, and posts original content on a daily basis, or more.

7 Twitter 1.Followers 1,125 Instagram 1.Followers 4,188 Facebook 1.Likes 1,521 Website Overall online Marketing Effectiveness Oh Doughnuts 1. Good 2. Good 3. Good 1. Excellent 2. Excellent 3. Good 1. Good 2. Excellent 3. Good Under Construction (currently a splash page) Good Business and Marketing Goals Kinden s business goal for Oh Doughnuts is to be able to cover her business expenses and make a profit. When she was doing sales through the coffee shops, all her profits went back into running the business and she couldn t make any money. The goal of this brand strategy is to increase awareness about Oh Doughnuts amongst potential customers.

8 Branding Strategy: Part Two Value Systems Vision To make mouths happy Mission To sell doughnuts in a way that doesn t destroy the earth To brighten peoples meetings/mornings To make a profit without compromising quality or creativity Core Values Commitment: Our customers have high doughnut standards Recognition: We respect the people and producers who support us Dedication: It s all about the doughnuts Creativity: We promise to never disappoint on flavours Culture Our team embraces what it takes to make and serve high-quality doughnuts that brighten peoples days. We are just like our doughnuts approachable, fun and innovative. Key Messages Oh Doughnuts is. What: the only gourmet doughnut shop How: that makes creative and innovative flavours with local and sustainable ingredients Who: for young foodies Where: in Downtown Winnipeg Why: who want better quality and vegan options When: during a doughnut revolution. Brand position I will position Oh Doughnuts as being the market leader in gourmet doughnuts. Innovative and inclusive (vegan/gluten-free) flavours, compostable packaging and sustainable ingredients, and attention to detail and quality make Oh Doughnuts different. Persona Oh Doughnuts is genuine and doesn t take itself too seriously. Whitty, smart and a little bit cute, Oh Doughnuts is the grown up version of Bronuts. Oh Doughnuts also cares about the environment, and not just because it s trendy.

9 Brand Style and Identity If Oh Doughnuts were to fall under a brand archetype, it would be the Jester. Kinden said it s about the doughnuts, and the food-gasms. The tone this brand is aiming for is whitty and engaging, while still being humble. Kinden just had her graphic designer recreate her logo and come up with some brand concepts in anticipation of the opening of the new shop, and I feel it is fitting for her brand style and identity. You will find these visuals attached to the back of this brand strategy. Tagline I can t take credit for this tagline because Kinden came up with it, but I want to include it because I think it fits well with the brand: Doughnut desires fulfilled Foundational Marketing Tools Having a social media contest on Twitter would be a great way to spread awareness that Oh Doughnuts is coming back, and to initiate online conversation again. A social media contest will appeal to past customers, and reward them for staying loyal to Oh Doughnuts while the business has been on a hiatus. Twitter is ideal because it s one the platforms foodies and tastemakers use the most for sharing their ideas on. Oh Doughnuts has developed a following on Twitter, and done well on this platform compared to the competitors. The contest has to offer both recognition, and something this group perceives as valuable to be successful. To capture business people on Broadway, giving postcards with promotions to businesses nearby is a great way to create awareness about Oh Doughnuts and entice people to approach the new business. A good sales promotion to capture this audience could be framed around the context of meetings, maybe offering them half a dozen doughnuts for $10 instead of $15. This positions Oh Doughnuts as the way to bring fun and fresh energy to a meeting or regular workday, which ties back in to the brand. Paying for a series of advertisements on Facebook would be an efficient and low-effort way to reach all the desired audiences and create initial awareness that can be built on with other marketing tools. It s ideal to run a series of Facebook ads because it s the social media platform all Oh Doughnuts target audiences share. The potential and past customers I described above use this platform in some capacity. The objectives of the ads would be to get people looking at the Facebook page to find out more about the brand, and reaching people near the business. The ads will use a tagline and a delicious-looking photo to draw people in. Finally, I believe creating a short video about Oh Doughnuts and posting it on Facebook and the homepage of the website would be a good marketing investment. This type of production attracts anyone who likes information delivered in a highly aesthetic way, which especially

10 appeals to tastemakers, and yuppies. The purpose of the video is to create awareness and convey key messages about Oh Doughnuts using a creative marketing tool the competition hasn t tapped into yet. For the video to be effective on people from this audience, it can t be an ad. It has to give them just enough information to move them to the next stage of awareness without selling to them. Sample Twitter Contest The Twitter contest would invite followers to submit ideas for over-the-top doughnut flavours, and Kinden would select the winning idea to be made and sold on opening day. The winner would also get to name the doughnut, and receive one free. The contest will run for one week before the store s opening and the winner will be announced the morning before the grand opening. Each account receives one opportunity to enter the contest and submit a flavour. The flavours Oh Doughnuts made during the trial run don t count. Here are some sample tweets: Submit your doughnut flavours/ideas by and using the hashtag #openingdaydoughnut to make your doughnut dreams a reality Have you submitted your idea for the #openingdaydoughnut yet? Tweet us using the hashtag and tag us for a chance to win ;)

11 The winner Please DM us so we can pick a name for your doughnut creation. See y'all at 326 Broadway for opening day! The winner of the #openingdaydoughnut contest will have their doughnut flavour sold at our grand opening. They also get a free one J

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