Will Dunkin' Profit From Free Doughnuts on Friday?

It's National Doughnut Day on Friday, and Dunkin' Brands (NASDAQ: DNKN  ) wants to tempt the inner Homer Simpson in us all with a free sugary treat.

The parent company of the 10,500-unit Dunkin' Donuts chain is offering guests a free doughnut with the purchase of any beverage.

This is a smart move on many different levels. For starters, this isn't like the annual Free Cone Day at Ben & Jerry's. There's a required purchase to get that free treat, and Dunkin' Brands is hoping that customers will pair up the freebie with one of its signature coffee drinks.

Dunkin' Donuts has cultivated a healthy following for its brewed bean water. The ambience of the bright doughnut shops may never match the barista hub of Starbucks (NASDAQ: SBUX  ) , but it's not a coincidence that both chains rely on their caffeinated blasts of joe to woo morning traffic. Both chains are also so well known for their coffees that both brands are marketed as Keurig K-Cup options.

Dunkin' Brands may not be as tony as Starbucks, but there's a reason Starbucks recently began opening Seattle's Best Coffee shops in strip mall parking lots to eat into the cheaper beverages being poured out by Dunkin' Donuts and McDonald's (NYSE: MCD  ) .

This move by Dunkin' also is a shot at Mickey D's, reminding morning commuters that coffee and a doughnut makes a reasonable breakfast choice.

If a doughnut alone doesn't sound like a substantial rival to the Egg McMuffin, how about the new doughnut bacon sandwich that Dunkin' is introducing this week? If bacon and egg served inside a sliced glazed doughnut sounds outlandish, the same thing probably could've been said when McDonald's introduced the McGriddle.

Running the free-doughnut-with-a-beverage-purchase promotion at the same time that it's introducing a head-turning sandwich is genius. Dunkin' will naturally get plenty of free publicity for the new sandwich as it becomes late-night-show joke fodder, but there's no harm in hammering it home in person when folks stop by on Friday to take advantage of the sweet holiday that supposedly dates all the way back to 1938.

Doughnuts are big business in 2013. Did you catch Krispy Kreme (NYSE: KKD  ) shares soaring 31% last week? Krispy Kreme posted blowout quarterly results, and it's come through with 18 straight quarters of positive comps. Krispy Kreme is better known for its doughnuts than its java, but that's also perhaps why it's offering its customers a free doughnut on Friday without them having to pony up for an additional purchase.

Dunkin' Brands has the right idea as Krispy Kreme attracts the freeloaders.

What about the McCafe master?
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  • Report this Comment On June 06, 2013, at 10:53 AM, cmom3 wrote:

    I LOVE how people who will head to KK are freeloaders.... what about the people who have no DD nearby or that KK is closer? OR!!!!SHOCKER someone who will not buy a coffee even for a free donut because...THEY DONT LIKE DD COFFEE!!!!

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