Executive Summary: I. Introduction
Krispy Kreme Doughnuts, Inc., began as a family-owned business back in 1937, as an expansion of a pre-existing business, when Vernon Rudolph purchased a doughnut shop along with the now-famous secret recipe for making yeast-raised doughnuts. His doughnuts, which he delivered to grocery stores in the Winston-Salem, North Carolina area, quickly became immensely popular with customers. So popular in fact, that he cut a hole in the wall of his shop so that he could sell hot doughnuts to potential customers passing by on the street. (Peter and Donnelly, 2009, Page 690). Who knows, but this may have been one of the first “drive-thru/walk-up” windows in the restaurant business! And that is just one example of Mr. Rudolph’s and his early partner, Mike Harding’s, forward-thinking marketing ideas for that era. The ideas of making all of the shops look the same, so that they would be recognized by patrons wherever they traveled, as well as the viewing windows for watching the doughnuts being made, were good examples of marketing promotional strategies. These strategies are still considered by Krispy Kreme to be “Brand Elements” as reported in current, annual financial reports. By keeping control of the recipe and the doughnut-making process, they also maintained product standards and reduced, while not completely eliminating, the competition through the uniqueness of their product. In fact, attempts to change the recipe, or even the look of the shops, in later years met with negative reactions from customers and the company quickly returned to the original taste and feel of the “original” Krispy Kreme.
The company and its doughnut became synonymous with a particular look, taste and feeling. This emotion that became associated with Krispy Kreme, described as “a feel- good business” and one that “created an experience” as opposed to just