The late Peter Drucker said, “It is not necessary for a company to grow bigger. It is necessary for it to grow better.” If only Krispy Kreme had listened to him.
I first tasted a Krispy Kreme donut 6 years ago on a business trip to South Carolina. I had never even heard of a Krispy Kreme. After a day of strategic planning and an over-priced dinner at a resort, my client was driving me back to my room when we passed this big bright neon sign for Krispy Kreme. “What’s that?” I asked. She almost killed us making a U-Turn on the four lane divided highway. “Are you kidding?” she screamed. ‘You HAVE to have some!’ I protested (having just consumed too much rich food and wine) but she wouldn’t hear of it. I could take them back to my room and have them for breakfast but I MUST try one bite tonight — while it’s fresh. She was adamant that I have the freshest experience. We drove through (it was 11:00 at night) and as she placed this warm box of six perfectly glazed donuts in my lap I was overcome by the smell. The perfect blend of sugar sweet and warm grandma love. I carefully pulled a delicate cloud of a donut out and took a bite. Almost immediately I felt the sensation of perfectly cooked dough that began to melt in my mouth surrounded in the thinest layer of glaze. I was hooked.
By the time I flew home the next morning, all six donuts were gone. A year passed and I heard that they were opening a Krispy Kreme in the Portland area (my home town in Oregon). It was all over the news. Traffic was backed up, they had coverage by helicopters to show the masses that were lining up to experience a doughnut!!
“If you do what you love, the money will come.” Gordon Oakshott, a friend of mine said that to me many years ago. Vernon Rudolph believed that too. Vernon bought a secret yeast-raised recipe from a French chef in New Orleans and began selling Krispy Kremes in 1937. He was so obsessed with perfection and consistency he invented and built his own doughnut making equipment. Later he proudly displayed it in his stores so people could watch them come off the line fresh AND created a big red neon light that went on to signal to folks that a fresh batch was coming off the line. It was all about freshness loving perfection.
Then Vernon died in 1973. In 1976 the company was sold to Beatrice foods. In 1982 a small group of Associates bought the company back from Beatrice and took it public. That’s when the brand started to die. An obsession with growth and profit took over and killed Vernon’s obsession with quality and freshness. In my opinion, KK died because of two simple words. Gas station.
The first time I saw a box of Krispy Kreme’s in a gas station I realized their brand was doomed. It has gone the way of corporate greed. Nothing says Krap like a donut in a gas station. That’s the kind of food you’ll eat out of sheer desperation — not love.
Krispy Kreme is Kurrently blaming their fall from grace (stock peaked at $50 per share and is trading around $8 today) on the AtKins Kraze. Are you Kidding? If only AmeriKans were that Krazy about health — we wouldn’t Kall the latest diet a Kraze.