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April 2006



It seems this Coffee issue may have run its course but here's some news from Canada. Just the other day I witnessed a new shop on the coffee landscape.

A Starbucks just down the road from where the Ottawa Senators play hockey in the NHL had of all things a drive through?? Could it be that Starbucks believes it can do the good cup of coffee fast??!

Now we're talking. I hope they put a new one on my way to work.


Sorry for not jumping in sooner with a comment or a new post. I have been traveling for work and then had to care for my two little kids with ear infections who only wanted Mommy. I have been drinking a lot of coffee just trying to survive. I used to remember my mother saying that sometimes she wanted to change her name to Daddy. I now totally understand what she meant.

With so few outlets currently in the US, I think it will be an uphill battle for Tim Horton’s especially with the strength of Starbucks and the all-American potential of Dunkin’ Donuts. Even if the coffee is “better,” remember simply being better doesn’t lead to success. It is the brand and the perception of being better that wins. Most say that Coke does not taste better than Pepsi, but Coke is the leader because it is the real thing. An authentic original.

Dunkin’ has the authenticity in the US. What they do with that is up to them. But the opening in the mind is there for them to build a more powerful brand.

So what about Tim Horton’s? Well my suggestion would be: Why not go to the rest of the world first, forget the US for the moment? I think a Canadian coffee brand would do great in Europe as the anti-American, anti-Starbucks brand.

I have had a lot of time to kick some stuff around in my head. I am going to start working on a post right now about some new campaigns that just broke. Weber grills, Vera Wang mattresses, and the you poke it you own it rule are a few that caught my interest.

Mark Turok

I really hope Dunkin' Donuts makes this move. They do make a good cup of coffee and can certainly compete with Starbucks.

I really appreciate your insight.

Mark Turok


I wonder if maybe we're thinking too functionally and simplistically about the business these brands are in. Tim Horton's isn't a coffee shop, it's Canada's answer to the neighbourhood pub. Starbuck's isn't a coffee shop, either. It's an alternative space that happens to serve coffee. When they came to this country, marketers were making bets about who would 'win', and failed to realize they weren't even playing the same game. Both brands prospered, while every brand that has tried to imitate one or the other of them has simply not made an impression. I think that this is one of those categories where thinking functionally misses the point by a mile.


Michael, Tim Hortons has started expanding rapidly in the US with high growth, high margins - Corp parent Wendys would've gone bust without the strength of Tim's. The key to Tim's growth is ultimately the coffee, which is vastly superior to Dunkins. Dunkin Donuts used to be quite strong in Quebec until Tim's expanded. Dunkin helped Tim Hortons by forcing its Quebec stores to pare their menu down to match their US menu, a cost-cutting step that cost them dearly. Many new Tim Hortons store are combined with Wendys, which provides a more stable revenue base, esp. in the US where people don't tend to drink coffee in the afternoon or evening. The sector generally is much stronger in Canada -big coffee market, cold climate - with Tim's, Country Style, Coffee Time and others complementing the somewhat different Starbucks/Second Cup/Timothys/Van Houtte end of the market.


Dude Dai......You are freakin us out. Seriously, that is really weird. Don't make us have Dateline follow up with you.


Laura ,, They are not in the same line..Dunkin' Donuts 's coffee is only a drink..


Laura ,, you are so beautiful :)

Michael Urlocker

I am not a brand expert by any means, but the fact that Tim Hortons seems invisible to many in the U.S., including to Laura Ries, is a telling statement.

Hortons is a powerhouse in Canada with 76% market share, but has had very little success in the US, even though it launched in Buffalo 21 years ago and Wendy's bought the company 11 years ago.

Again, I dont know much about brands, but to me Hortons' weakness in the US looks like a case of a dominant firm failing to use disruptive innovation (think technology like BlackBerry or i-Pod.)

I am still new to blogging, so if it is appropriate, I welcome posts from this expert marketing community on the disruption theory as it applies (or doesn't) at www.OnDisruption.com

Specific post is:


Some great thoughts coming in. I especially liked your thinking Paul. The opportunity in going against Starbucks needs be all about fast, although people at Starbucks say people don't care about it. I think many people would sometimes sacrifice their speciality drinks if they could get good coffee faster.

Dunkin Donuts is a donut shop, but other players have taken over that angle as you have stated. Today Dunkin Donuts is really stuck in the mushy middle, with Starbucks at one end and speciality donut and food shops at the other.

However, Dunkin Donuts was always considered a great place for coffee. I grew up in the northeast with them everywhere. So with all the units they have, I think they could make a transition to a more coffee place. Putting in drive-thrus at every location is brilliant.

I'm going to be thinking a little more on this and amending the article to appear on adage.com next week.

Paul Hotze


Enjoyed reading your article, very interesting. However, I think there is a flaw in your thinking. Starbucks is a coffee shop that serves pastries, where as Dunkin Donuts is a donut shop that serves coffee. I think that Dunkin is in a totally different segment than coffee.

Here in Houston there are probably two or three Dunkin’s here in town. Shipley Donuts and Krispy Kreme are the major players in the donut market. So I have little or no relationship with this brand. I think that there is no way for Dunkin to position itself as the faster, quicker coffee person. It just won’t work because they specialize in donuts and not coffee.

Now what Dunkin could do would be come up with a brand extension, let’s say Cup of Joe Express, and sell coffee and pastries/donuts through their stores. Perhaps it is mandated that all Cup of Joe Express have drive through windows.

I am pretty religious about my morning cup of coffee and always go to Starbucks for it. I would say that 90% of the people who go in there order a specialty coffee (i.e. Grande Mocha, Non-fat soy latte, Frappucinno, etc.). The other 10% get regular coffee and not the specialty drinks. So I think the market for just regular coffee is pretty small.

However, I think you are absolutely right about there being a market for express coffee. One of my biggest frustrations with Starbucks is waiting. I hate it. So if there was a way for Cup of Joe Express to hasten the process of making specialty coffee drinks, they could be onto something. I just don’t think that Dunkin has that leverage to make itself the quicker coffee guy since they specialize in donuts.

Just my two cents on the subject.

Hugs to you,
The Hotz(e)

Game Producer

If they want to move fast... they could move to other countries (like Finland). We have no Starbucks here, just Nokia ;) (at least partially nowadays)


I have never been in a Dunkin donut shop. As a outsider reading this. Changing to name to Dunkin coffee. I'm thinking about the whole company strategy. It's like when Nokia changed strategy to mobile-phones instead TV etc. Everyone know how that changed the mobile industry. I think Motorola knows!


Well, it sure sounds like it's being line extended if we use Dunking coffee. Although if Dunkin Donuts can work through its strategy in such a way that they can build a new brand that's totally focus on "fast and affordable coffee" and utilize their infrastructure and resources to establish such brand, then it may have a chance against Starbucks.

FYI: There are a lot of Starbucks here in Manila, but very few people would consider Dunkin Donuts a competitor of Starbucks since as many of you said the "donuts" in their name says it all about this shop.


How about changing the name to "Dunkin coffee".

Chuck T

This is essentially what D&D has done already here in New England, where it dominates the landscape.

Dunkin has always been about the coffee. It's always been about getting it fast, hot and good. While Donuts is part of the name, it hasn't been a key part of the marketing in a long time.

There are at least 4 Dunkin Donuts along my 6 mile ride to work and not one Starbucks, which means I need to make an extra trip if I want to go there. (Starbucks has decided not to move into Waltham, Mass., believing that the middle-class city is firmly D&D territory).

If I have time, I do, but time is always the variable.

D&D seems to have known its market. Hopefully the new owners do too.

Moses Mehraban

Great article!
Dunkin’ Donut is a great example of a brand that not only needs to differentiate itself from its competitor (Starbucks) but more importantly their new strategy must be relevant to their customers.

In my opinion, Dunkin' Donut’s can spend millions of dollars trying to change everyone’s perception of their brand as a coffee shop for all Americans but I don’t think they will be able to achieve their goal with their current marketing message. They’re biggest downfall is in their name which instantly makes me think of donuts first than anything else. With more people leaning towards a healthier lifestyle Dunkin Donut has its work cut out for itself; its name has minimal relevance in today’s culture. Their new message about “America runs on dunkin” lacks credibility and relevance. It almost sounds like their enticing that “America runs on Donuts”.

Differentiating their services by focusing on busy Americans who want “fast service” would be a great advice to take, but they will need to incorporate a stronger message that is relevant to American culture and position’s itself far away from a donut shop as their name implies.


Okay, I was just wondering?

If Dunkin Donuts will move on to beating a coffee-chain, isn't it wandering from its core business as a donut shop? Or is this the time when you actually see the three (3) different things that occur in a business: Focus, sales and profit source.

Just a thought.

Dennis D. Balajadia

The success of one brand brings in tremendous opportunities for others. Starbucks is one slow green coffee shop and I agree that Dunkin' Donuts with its size and network is in a position to brew something new in the coffee category.

The challenge with FAST is how to make it cool and not cheap. Thou slow is undesirable, it might just be on the surface. People naturally put a higher value on something that they 'wait on.'

It's not impossible to equate fast coffee with cool, but this would definitely be an exciting challenge.


Tim Horton’s is a very powerful brand in Canada. But, there is no way Americans are going to adopt a too late, hoser brand. Laura is right, Dunkin' Donuts is the horse to bet on in low-end/faster coffee.


My mistake, thanks for the correction. The Tim Horton brand certainly has potential more so that the other Starbuck clones, but I still believe Dunkin' Donuts has the edge, with 4,400 US outlets, to make a strong run as a powerful number two brand. If they can better define the brand, the menu and the experience.

johnmoore (from Brand Autopsy)

Laura ... Tim Hortons has 288 locations in the US and recently went public.


Thanks Kevin, we don't have Tim Hortons down here in the US, but I have read much about the success of that brand. Going against a strong leader takes a strong position in the opposite direction.

Kevin Barefoot

Tim Hortons successfully occupies the affordable, fast, and down-to-earth coffee position up here in Canada.

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