It’s time to make the donuts. And then deliver them to your doorstep.
Dunkin’ Donuts (DNKN) CEO Nigel Travis told CNBC that the restaurant chain, which is already developing mobile ordering, also sees on-demand food delivery as “a big opportunity.” According to Travis, the trend in the U.S. “is convenience. So I think delivery plays very strongly.”
While the doughnut and coffee maker is signaling plans to someday test delivery and mobile ordering, it is already trailing rival Starbucks (SBUX), which is already experimenting with both concepts through pilot programs. Starbucks in March expanded mobile ordering — a way for customers to place and order on an app and then pick it up at a Starbucks — across much of the Pacific Northwest. It is also testing delivery in Seattle and in New York City’s Empire State building.
Other food and beverage makers are jumping on the bandwagon. Chipotle (CMG) has mobile ordering already, while Yum Brands’ (YUM) executives say there is potential for delivery for the Taco Bell and KFC restaurant chains.
Tech investments could be just the jolt Dunkin’ Donuts needs. The company’s U.S. same-store sales grew just 1.6% for fiscal 2014, lagging the 6% jump Starbucks reported for the Americas region for its latest fiscal year. Results were better in the first quarter of this year, boosted by higher restaurant traffic and increased spending when customers visited the company’s restaurants.