Great Circle Family Foods, which operates 11 Krispy Kreme franchises in Southern California, recently discovered that offering wireless Internet access can power a traffic-driving promotion.
During last winter’s “Totally Sweet Sweepstakes,” Great Circle saw year-over-year traffic increases in the high single digits and the redemption of hundreds of bounce-back coupons, said chief executive Roger Glickman. Customers who signed up for a free 15-minute trial of the Krispy Kreme locations’ Wi-Fi received a coupon for a free doughnut on the next visit, and grand prizes for the contest included free Wi-Fi for a year and a free order of 12 glazed doughnuts every week for a year.
“We saw hundreds of those coupons come back, which to us was tangible evidence that we were getting traction,” Glickman said. “I don’t have an exact figure, but on an order of magnitude, the redemption rate on these coupons was about 10 times as great as a direct-mail piece would have been. The entries were coming from people already in our stores, so this really enhanced the frequency of our existing customers.”
Great Circle outfitted all its units with Wi-Fi in summer 2010. Glickman said the investment was cost-effective and produced a fast return on investment once the Totally Sweet Sweepstakes drove awareness and trial.
“The cost to install the system was minimal; it’s a low barrier to be able to offer this new relationship with our guests,” he said. “It was a very quick payback, and frankly we feel like there’s been a substantially positive ROI from day one.”
The franchisee’s wireless vendor managed the contest and collected data from customers each time they logged in.
“We wanted to get people exposed to this new interface for our guests that [our Wi-Fi provider] Boingo created,” Glickman said. “When you log in to one of our stores’ Wi-Fi, you get one of three interfaces. One was a quick survey to ask guests what their favorite doughnut is, another forced them to watch a 30-second Krispy Kreme commercial, and the last asked for guests’ e-mail address and automatically entered them into the sweepstakes.”
The vendor also promoted Great Circle’s contest by e-mailing 60,000 people on its distribution list in Southern California. Customers also were asked to spread the word of the sweepstakes on social media, for example, by including a specified contest hash-tag in a Twitter update in exchange for free Wi-Fi at Boingo hotspots in airports.
Glickman added that his Krispy Kreme units were benefiting from the common advantages for restaurants offering Wi-Fi, like increased time spent in the restaurants that often can lead to incremental sales. But most importantly, having wireless Internet access for customers made his locations appear more convenient and attractive to old and new guests, he said.
“I’ve seen reports that lingering can be a double-edged sword, but that’s not happening to us,” Glickman said. “[Wi-Fi] is eliminating the veto when [a guest might be] choosing another location over one of my Krispy Kremes. We see people taking their time, having meetings or get-togethers around their laptops, and while they’re there, they’re purchasing. Anecdotally, we’re seeing more people during the middle of the day, and they’re logged in while they’re there.”
Customers at the Krispy Kreme stores can use the Wi-Fi for free for the first 15 minutes. After that, they can purchase access for $3.95 per hour or sign up for a monthly package with Boingo.
Now that Wi-Fi is in place and showing good traction in his stores, Glickman said the next step calls for some remodeling and updating to capitalize on their improved perceptions of convenience and comfort, such as with warmer colors and new furniture.
Contact Mark Brandau at [email protected]