‘Donut’ Forget, Brand Values are Category Specific

baked donutsIf you’ve been following the McDonald’s debacle for the past year or so you can’t have missed the fact that the company woke up late to the fact that consumer values have shifted. Away from fat/salty/fast dollar – menu foods to brands that are seen to offer healthier, fresher, natural, more customized food consumers are actually willing to pay more for.

Marketers, you have to watch those values. They don’t so much as sneak up on your brand as much as pounce. And today they move at the speed of the consumer. They get missed on traditional research radar screens. Brands that miss them, and are unprepared for those value-shifts, generally end up with the short end of the balance sheet. Just like McDonald’s.

The thing is, values aren’t cross-category generalizable so you can’t rely on what happens to some brand outside your category. You have to be on the watch for what’s specifically happening in your market space/category.  Sure, “trust” is part of every category, but what “trust” stands for in the pain relief category is vastly different than what “trust” means in the automotive category, and different still from what it stands for in the smartphone category.

National Donut Day

This all came to mind because today we celebrated National Cream-Filled Donut Day, and a few people were surprised that in the face of value shifts to healthier food, donut sales have increased – by about 7% YOY.  So health notwithstanding, Americans have ended up eating more than half a billion of donuts annually. Those health-related value shifts had great impact in the fast and fast-casual food category, but pretty much no influence on donuts.

Just because they’re both foods, they’re really not the same, and values for each are vastly different. Really. You don’t think about a hamburger in the same way you think about a donut. Sure, “taste” is in there, but a really different kind of taste. Come on!  You are never eating a donut because you think it’s a healthy option. The healthiest part of the donut is the hole. Now “variety” is a value that resonates when you think about donuts. See? Category-specific. And, have you ever had a fresh donut that wasn’t tasty? Except a stale donut, maybe. But what’s tastier than a fresh donut?

Sure, a lot of those half a billion donuts came from small bakeries, local pastry shops and corner food carts. But the majors – the Dunkin’s, the Tim Hortons’, the Krispy Kremes, the Daylights, the Winchells, and the Shipleys – all seem to be doing better and better. Which raises another issue – the one about how values have massively shifted in the how-and-what Americans eat for breakfast, currently to the detriment of cereal brands, and also in the way that donuts are no longer primarily viewed as a breakfast food.

At the moment, donuts are a treat, and one that’s seen as a great value-for-dollar-for-variety treat, which has spurred category innovation, expansion and profitability. The Cronut – part donut, part croissant – created by the Domminique Ansel’s SoHo bakery, in New York City. Or Astro Doughnuts & Fried Chicken, in Washington. D.C. and their Fried Chicken Donut. Or the Los Angeles Nickle Diner’s Bacon Mable Donut. To quote a well-known donut expert, “Mmmmmm. Donuts!”

If you missed these celebrations – National Donut Day on June 5th and National Jelly-Filled Donut Day on June 8th – never fear, September 14th is National Cream-Filled Donut Day. Other days where you can enjoy a donut are: Buy A Doughnut Day on October 30th and National Doughnut Day on November 5th.

Surprised there are so many days celebrating the donut? Well, just think of them as occasions to treat yourself and celebrate being smart enough to monitor and leverage all those category-specific values that can help your brand grow and prosper. And, sticking with our theme we’d remind you that brand managers who do not track and leverage their category values end up with lower earnings and share prices. And, usually a glazed expression on their face!

Robert Passikoff, Ph.D. is the founder and president of Brand Keys Inc., a customer engagement research consultancy.

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