How new CEO Tony Thompson plans to take Krispy Kreme beyond doughnuts
Courtesy of Krispy Kreme
Tony Thompson is president and CEO of Krispy Kreme Doughnuts Inc. in Winston-Salem.
- Catherine Carlock
- Reporter-Triad Business Journal
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Tony Thompson has been president and CEO of Krispy Kreme Doughnuts Inc. for about 90 days. The former Papa John’s International executive this week laid out early plans for how he intends to capitalize on the growth potential of the 77-year-old Krispy Kreme and take the company beyond its sweet-treat namesake.
Thompson spoke in Krispy Kreme’s (NYSE: KKD) second-quarter conference call late Tuesday.
1. Expand beverage offerings
Most consumers think of Krispy Kreme as a doughnut store, not a doughnut and beverage store, Thompson said. While Thompson’s glad consumers are buying doughnuts, he thinks Krispy Kreme has barely scratched the surface in capitalizing on beverage opportunities both inside Krispy Kreme stores and in other retail outlets.
One of Thompson’s top priorities is to leverage the Krispy Kreme brand into expanding its beverage platform, so coffee and other specialty drinks can generate additional revenues.
Krispy Kreme stores are already testing frozen and pumpkin spice lattes. Sam’s Clubthis year began sales of Krispy Kreme-branded packaged ground coffee, more than 1,000 Walmart stores are selling ready-to-drink iced coffee and just this quarter Krispy Kreme K-Cups hit the shelves.
“We know they’re coming for doughnuts, but we want them to make that decision also to purchase a beverage,” Thompson said,according to a conference call transcript from investing website SeekingAlpha. “So that’s our new-term focus, longer-term as our footprint continues to grow, we will become more accessible as a destination and more frequent beverage user.”
2. Expand wholesale offerings
Thompson didn’t elaborate much on this point, but he did say he sees room for growth in Krispy Kreme’s wholesale business. As such, Krispy Kreme is planning to introduce new products before year-end. The focus will be to create products with a longer shelf life than the standard doughnut, he said.
3. Deploy technology such as a digital loyalty program
Krispy Kreme is behind on harnessing data to understand its consumers, Thompson said, and as such will need better tools to summarize and analyze operations and sales data in a timely way.
In the near-term, Krispy Kreme has partnered with two agencies with global scope — digital marketing agency VML and consumer transaction technology expert NCR — to develop Krispy Kreme’s first digital loyalty program. Testing that program — which Thompson declined to provide much detail on — will begin by year end.
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