Dunkin’ Brands Group
chief information and strategy officer, said technology is playing a central role in upgrading the chain, known for its namesake donut shops and its Baskin-Robbins ice cream stores.
He’s overseeing a $100 million test to outfit dozens of stores with new technology and a more modern design, and he’s the driving force behind a transition to cloud services, both of which are aimed at helping the company stay competitive.
“We want to refresh our image and make sure we’re continuing to be contemporary and relevant to our customers,” said Mr. Clare, who joined Dunkin’ Brands in 2012 as chief information officer and became chief information and strategy officer in 2015.
Technology upgrades are becoming critical to decades-old retail brands, and information technology executives such as Mr. Clare are owning more of the corporate strategy. Mr. Clare added that he’s also become the enabler of strategic marketing initiatives, which include in-store technologies and mobile ordering.
As of October 2018, the company had more than 60 restaurants outfitted with upgraded technologies, including cold-brew tap systems and high-tech espresso makers across the U.S., ahead of its initial target of 50. Mr. Clare has overseen the in-store technology upgrades since the initiative began over a year ago.
More than half of Dunkin’s $100 million investment, announced last year, is being spent on restaurant equipment such as new espresso machines, with part of the goal being to increase throughput in stores. The rest is going toward technology infrastructure and training, The Wall Street Journal previously reported.
Under Mr. Clare’s purview, the company also has transitioned much of its infrastructure to Amazon Web Services’ public cloud, beginning in 2017. That’s saved the company upwards of $1 million, in part because it reduced reliance on shared data centers, he said.
Instead of spending weeks or months provisioning hardware for technology projects, IT teams now can access services via the cloud in minutes or hours, he said. The company can use public cloud services to deploy new features to the mobile ordering app, for example, in weeks instead of months.
“The time to market is orders of magnitude faster,” Mr. Clare said.
The company declined to disclose metrics on how technology upgrades were impacting revenue. But plans for expanding the test beyond 60 stores are underway, Mr. Clare said.
Dunkin’ Donuts and Baskin-Robbins stores in the U.S. saw less traffic in its most recent quarter, but average ticket prices rose. Comparable sales at Dunkin’ Donuts locations in the U.S. rose 1.3% in the quarter ending Sept. 29, 2018, and overall sales for the company’s most recent quarter rose 6% to $350 million, above consensus forecasts of $342.9 million, the Journal reported. The company is filing earnings on Feb. 7.
The first new-concept store opened in January 2018 in Quincy, Mass. At another upgraded store near Times Square in New York, remodeled last fall, franchisee co-owner Richard Greenstein said technology has “positively influenced sales.”
The store can serve more customers during peak hours because they can order ahead via a mobile app and know their order is ready by looking at an in-store digital display, Mr. Greenstein said. Lines have gotten shorter as a result, other store associates say. The store’s new automatic espresso machine and cold-brew tap system also aim to entice customers that would otherwise pop into stores operated by coffeehouse competitors.
The company also is looking to use new technologies such as artificial intelligence to increase personalization efforts. As of last October, 12% of Dunkin’ U.S. sales were from customers using the company’s loyalty rewards program, which includes a mobile app and offerings that have been building over time since 2012. That means the company is beginning to learn more about customer behavior, including how many times each week they visit stores, what they order and what times of day they order, Mr. Clare said.
“The next obvious leap is to anticipate behavior,” using data analytics and artificial intelligence, but the company still needs to aggregate more data, Mr. Clare said. “It’s a pretty new concept for us. There’s nothing stopping us; we’re just trying to play catch-up with other forms of retail and consumer brands,” he said.
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