With Dunkin’ preparing to re-enter Canada after exiting the market in 2018, SATOV, a consultant company, undertook a study to understand the opportunity, including the strength of consumers’ morning routines with incumbents, Dunkin’s residual brand equity, and consumers’ likelihood to visit.
The research explored the key factors that could drive trial, repeat visitation, and ultimately adoption into Canadians’ regular routines
“Dunkin’ has room to play in Canada, despite a mature market and entrenched morning routines. Canadians are more open to changing their routines than their stated loyalty would suggest, creating a credible path to trial and repeat consideration,” said the report.
“Dunkin’ enters from a position of strength, with existing brand familiarity reducing the challenge of attracting consumers to try the brand. Positive firsthand experiences suggest Dunkin’ can convert trial into repeat consideration, rather than relying on curiosity alone to drive traffic
“Convenience and value will be critical to conversion. Store locations and pricing will determine whether consumer interest and trial turns into frequency.”
Its main competitors would be Tim Hortons and Starbucks.
Liam Johnson, Engagement Manager with SATOV, described the company as a boutique management consultancy founded in 2002.
“We primarily work with CEOs and private equity leaders across North America on growth strategy, M&A advisory, and operational improvement. We work in a lot of industries. We happen to work in retail and consumer a fair amount over our history,” he said.
“And this report in particular is driven in part with our Consumer Insights team. They’re experts in conducting primary research and getting to market quickly. So we’ve done similar studies to this, as when Target came to Canada many years ago, for example, and when Uber entered the Canadian market.
“We mostly do client work, but often also like to engage in some of our own studies as well.”
The Dunkin’ report was not commissioned by anyone.
“This is a market with fairly loyal customers and a market with pretty entrenched morning routines. But at the same time, we found that Dunkin’ definitely has room to play in this market despite that. 63 per cent of Canadians are loyal, but at the same time, 56 per cent of them say they would try Dunkin’. And so I think the big takeaway is people are definitely curious. People are generally excited about this brand coming to market.
“That trial intent actually increases to 75 per cent when Dunkin’s within a five-minute drive. And so convenience and location play a huge role in consumers actually trying this.
“It’s a mature market with entrenched morning routines and with entrenched incumbents. But consumers certainly indicate that there’s opportunity for another player.”
The report said a third of Canadians are having coffee somewhere several days a week.
“It’s a big market, certainly something that Canadian consumers are used to. They have morning routines, and they generally indicate that they stick to them,” added Johnson.
“Dunkin’ has a history here. 46 per cent of Canadians have already been to a Dunkin’, either when it was here before or when they’ve been traveling. And so those past visitors actually rate the perception of the brand a fair bit higher than those who haven’t.
“And so it doesn’t guarantee success, but it’s certainly a strong starting position for the brand.”
Foodtastic, one of Canada’s leading restaurant operators, announced it has signed a master franchising agreement with Inspire Brands to open hundreds of Dunkin’ locations across Canada.
Under the new agreement, Foodtastic said it will have exclusive rights to develop the Dunkin’ brand nationally through both corporate and franchise-operated locations. This expansion strengthens Foodtastic’s relationship with Inspire Brands and adds a globally recognized coffee and donut concept to its Canadian portfolio, it added.
“Bringing Dunkin’ back to Canada is a significant growth opportunity for Foodtastic and our franchise partners across the country,” said Peter Mammas, Foodtastic Founder and CEO. “This agreement demonstrates the strength of our relationship with Inspire Brands and the confidence we have built together through our work with Jimmy John’s in Canada. We are committed to growing the Dunkin’ brand thoughtfully to meet the needs of Canadian guests and communities.”
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