Dave Skena, chief marketing officer at Krispy Kreme, is tasked with innovation, marketing, communications and digital consumer experiences, among other things in his global role at the fast-moving donut chain. But that’s what keeps him excited.
“It’s really making all the symphony work across these integrated connections that that drive the business results and drive the brand,” says Skena. “We want to be the most loved sweet treat brand in the world, not the biggest, but the most loved, the most adored in the US and all over the place.”
Krispy Kreme has aggressive growth targets. The company grew net revenues 23.4% to $1.4 billion from 2020 to 2021 and expects this growth trajectory to continue. From a marketing standpoint, the company’s No. 1 KPI is growing brand love.
“I’m always looking at, are we growing brand love, that is the number one most important thing? Do more people love us than a year ago? And how do we stack up against other sweet treat brands, which is our frame of reference,” explains Skena.
To stay relevant, the company relies on limited-edition seasonal products that encourage consumers to come in often and check out what’s new. Krispy Kreme relies on these product innovations to delight consumers. For example, the company debuted a limited-edition Oh, Honey! Collection this week. These bee-shaped donuts are the first made with real honey and come with a package of flower seeds that consumers are encouraged to plant to help bees. The promotion is gearing up for World Bee Day on May 20th.
During Easter, the brand created spring minis, a mini shell donut, a new innovation on the brand’s popular mini rings. “If you think of innovation, there’s sort of refresh, reframe, and breakthrough innovation,” explains Skena. “And a lot of our limited time only offers are in that first category. Keep it fresh, keep something new coming. But then this is a good example of where we’re trying to put a tweak on a familiar favorite, so instead of doing these mini rings, we have these mini shells, and they’re shaped like eggs and a little chick.”
Prior to joining Krispy Kreme in 2018, Skena served as CMO of Ruby Tuesday and prior to that he spent eight years in senior marketing roles at Frito-Lay. Brand Innovators caught up with Skena from his home in Orlando, Florida to talk about innovation, digital ordering and nimble marketing in light of supply chain issues. This interview has been edited for clarity and length.
Can you talk about how Krispy Kreme shows up in the culture to stay relevant?
Back in January, the Red Cross had a blood donation crisis. Omicron was going on and there was just a general decline in donations, and they needed an influx. We know we’re just a donut company, but we wanted to know what we could do to help solve this problem. So we worked with the Red Cross and we said we would give a free dozen donuts to anybody who donates blood to the Red Cross. And people came out to give blood.
I don’t think any CMO should undersell or underestimate their ability to make an impact on whatever brand they have. You don’t need to be a nonprofit brand to do good things in society. Not only does it grow the brand, it invigorates your team, it gives the company a sense of mission because they see that you can be more than the product.
Are there any channels where the brand is investing more now vs. pre-pandemic?
The way that we’re going after social media has shifted. There’s been a big shift towards video.
Facebook and Instagram have been reliable media channels for us where we have been heavily invested. We have moved more towards TikTok. We’ve also invested a good bit more towards YouTube. We have found because of the various ways we can geofence and be precise about who we reach and how often we reach them, that the different digital media options we have continue to perform.
We are also looking at earned media as a credible important channel in the media mix. I’m one of the few people who really believes in that wholeheartedly and I hope it stays that way in some respects. I can’t believe more people aren’t realizing that the power of doing something genuinely newsworthy, that is genuine and authentic to the brand. People will want to talk about it, and they’ll do that work for you. I think more people don’t do that because there’s no certainty in it. You’ve got to earn it. You have to be bold, you have to be authentic, you have to do something that is genuinely newsworthy and not crassly promotional, and of course in line with your brand.
What impact has digital ordering had on your business as people are ordering food for delivery via digital channels and partners and how have you adapted your marketing to meet this shift?
We went live with our ability of nationwide delivery in February and the pandemic began in March. We were expecting about 2% of our sales to come from that channel, and that’s about what we were ready for. And then the pandemic hit, and within the first month that channel became 10% of sales. It sounds like a cliche, but transformative is the word because it is so much broader than having your website and app working. It is a shift in your operations group, the shift in store, prepping and securing areas for to-go orders. There’s a huge analog component to digitalization that I think people miss out on. As orders have increased, what is the implication for brick-and-mortar shops? How do you have the drive thru lanes that move fast enough so the Uber Eats guys can grab the food quickly. Obviously, all of our peers have had to solve these things as well. And then how do you do touchless delivery without the product sitting on the front step and all those kinds of things.
Digital ordering grew from nothing to 10-12% of our business pretty quickly and it’s stuck there. One of the biggest things is to integrate all our marketing to support this shift. So call- to-action such as “Order Now” in ads on social media and also making sure that every offer is easily accomplished offline, as well as online. And before the focus was on promotions in the store, but now it has got to work outside of the store. We look at things like specialty packaging, which is very analog. But specialty packaging honestly ends up mattering a lot more in a digital world because consumers don’t have the experience of being in the store. So if you order your Valentine’s Day dozen that special store experience is not there. How can that box help bring that special experience home and make it feel more special?
How has the company been impacted by supply chain shortages and how are you adapting to these issues?
Yeah, we absolutely do. Everything from ingredients like raspberry filling to sugar pieces. These are things that are required to create those special experiences we make. If you order them all from Vietnam, and that country closes down due to Covid for a couple months, well, that’s going to have an impact. We’ve definitely had those impacts, not just shipping shortages, but also suppliers shutting down for a while. The biggest way we’ve had to deal with it is increasing our lead times. And that puts a lot of pressure on the marketing team, especially one that wants to stay nimble and relevant. It’s great to plan ahead, but if you look at a lot of the success we’ve had, it’s been nimbly reacting to changes in the world as they occur. A longer time horizon for planning sounds good from an efficiency perspective, but it limits your ability to maintain relevance. So with our supply chain group, the biggest thing we can do to help them help us is back up the timeline, so that there’s more slack in the line.
What are Krispy Kreme’s commitments to sustainability, and how have those manifested in your work as a marketer?
We have some commitments in place already –cage free eggs by 2026, deforestation free palm oil by 2026. We want to be sustainable in our sourcing and those are a good beginning. Our aspirations on sustainability are much bigger than what we’ve done already. And so we have an assessment going on here in 2022 of just how far we can move in that direction. I think we all agree, we’re still early in our journey, there’s so much that could be done.
What are you most excited about for the remainder of 2022?
We’ve got some really cool innovations coming up that we’re very excited about. We’ve got our 85th birthday coming up this summer and we’re gonna do some things around that. After pandemics and inflation and wars and everything else, it’s hard to say I’m looking forward to seeing what happens. but what’s always exciting about the next six months or a year for me is the unknown. Because we are a brand that has been able to take stock of what happens in the world and immediately take action and participate in it. I’m excited about what I don’t know about but when we see an opportunity, I know we’re going to jump all over it. We’re going to try to participate in society in a way that makes sense for the brand and that can hopefully put some smiles on some people’s faces. Because when times are unstable or tough in some ways, people need a brand that is about joy more than any other time.
