I walked into the store for a quick snack. A vast glass wall invited me to see the inner workings of the operation. They truly had nothing to hide. A conveyor belt carried fist-sized rings into a pool of oil. An employee was there to snag anything that did not fit the company's exacting standards of what the product should look like.

Out of the oil, and through a thin waterfall of sweet glaze, the fluffy hoops of delight were then placed in flat boxes or set neatly in display trays.

I proceeded to the counter, and stood there for a moment examining the menu of choices. As I carefully considered my options, an employee handed me one of the newly created treats, and invited me to enjoy it on the house. After one bite, the words “I'll take a dozen” flew out of my salivating mouth. A two-doughnut snack turned into a treat for the whole family when I got home.

The Phenomenon

If you haven't heard about Krispy Kreme doughnuts by now, you don't have any friends, and you don't have access to any news sources. It's the uber-food of the doughnut world.

Krispy Kreme spends almost nothing on advertising. No TV commercials. No billboards. No radio ads. No print ads.

They let the press give them free TV, radio, and print coverage because their store openings are so popular. Hundreds of people line up on the first day of a new store opening. After going public in 2000, its stock has whipped every major stock index over that time period.

Many stories have been written about how they have grown so fast in the last few years. They give away free samples in areas they will open stores. They only open one store in any single community to create demand for a scarce product. They embrace and support a community of Krispy Kreme fans.

Quality Product and the Customer Experience

Their product is darn tasty, and as addicting as a doughnut can be. If it weren't, they would never have attracted the legions of loyalists they now have. Word of mouth has worked well for them.

Not only is the product without peer, but the customer experience is the best in the business. While Subway lets you see your food being made, it's not nearly the same magical trip you get at a Krispy Kreme store. A sandwich can be very tasty, but a hot Krispy Kreme is a religious experience.

At the Crossroads

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ABOUT THE AUTHOR

Dan Limbach Dan Limbach (dan@sireninteractive.com) is the Director of Marketing and Product Development for Siren Interactive in Oak Park, IL. (www.sireninteractive.com)