When Dunkin Donuts came to Indonesia in 1985, it simply had no serious competitor. Many Indonesian hardly even knew about donuts. Dunkin Donuts was the first company to popularize it here in the country. The global company remained the market leader for years until a local brand, J.Co Donuts, launched its first store in 2006 and took the competition head-on. Currently, J.Co Donuts vs Dunkin Donuts is a fierce battle.
Dunkin Donuts Indonesia targeted middle to upper class urban citizen. Therefore, you will normally see the booth at fancier malls. It offered modern donuts with various flavor, while many traditional Indonesian donut-like snacks was only greased by sugar. Even though price is relatively expensive compared to traditional snacks, the product uniqueness quickly gained popularity among urban citizen in its early years.
J.Co targeted the same market with relatively same modern donuts. The company also opened its booth at popular malls (Indarwati & Tiarawati, 2015). They even sell the same beverages, mainly coffee. It was really meant to compete directly with Dunkin Donuts (Juddi & Setianti, 2019). Interestingly, it didn’t take many years until J.Co overtake Dunkin Donuts as the most popular donut in Indonesia.
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One of the biggest Indonesian business magazines, SWA, awarded J.Co as the Winner of Marketing Dream Team Award in 2007, only one year after its first launch. In 2018, J.Co has acquired 46.7% of the market share, leaving Dunkin Donuts behind by 39,9% (Juddi & Setianti, 2019). J.Co is now one of the most successful Indonesian brands and the success story is there for us to study. Here is my analysis of the well-crafted strategy of J.Co Donuts.
J.Co Donuts vs Dunkin Donuts: Different Donuts?
Indeed, J.Co sells the same kind of food and beverages as Dunkin Donuts, but the products are not made to copy Dunkin Donuts. J.Co has its own recipe which was developed and refined three years before its first launch (Nurbaya, 2016). The founder, Johnny Andrean, has a broad experience in the food industry prior to the founding of J.Co.
Many customers perceived J.Co as more fluffy donuts, while Dunkin Donuts is relatively meatier (Nurbaya, 2016). Some prefer Dunkin Donuts because it fills the stomach, while others prefer J.Co because it tastes better. This product differentiation gives J.Co an edge in the competition. It has gained a reputation from the customers and succeeded in maintaining the reputation by consistently serving the expected products (Alice, 2009).
J.Co Donuts’ price is slightly lower than Dunkin Donuts, which can also be the main factor in how it can obtain a big market share. It could drive Dunkin Donuts customers to try J.Co for once, and convert a lot of them forever.
Open Kitchen Concept
Before establishing J.Co, Johnny Andrean was the Master Franchise at BreadTalk, a premium bread company based in Singapore. The company used an open kitchen concept, in which customers can see how the bread is created, and how the hygiene of the kitchen is impeccable. He adopted this open kitchen concept to J.Co and let customers see how the chefs make the donuts as well as the splendid hygiene of the kitchen (Indarwati & Tiarawati, 2015).
This unique feature can also drive people to, at least, try it for once. J.Co is confident that the taste alone can convert the customers that just want to try to become loyal customers. The open kitchen makes the J.Co store stands out from other stores, which can create curiosity in their potential customers.
Effectively Utilizing the Local Pride as a Positioning Strategy
Most of J.Co’s ingredients are imported from other countries (Nurbaya, 2016). However, the brand successfully utilized the local pride of Indonesian customers. Indonesian government actively sponsors the buy local campaign, which helps J.Co to earn positive mention as a successful local brand. It also earns a free position in the market as a local and better version of Dunkin Donuts.
When Indonesian local coffee become a trend in the last decade, J.Co quickly adopt local coffee for their products, replacing Costa Rica coffee that was previously used. It earned positive news in the media. The coffee products contribute to almost 35% of J.Co Indonesia’s total sales (Sitanggang, 2015), so the amount of coffee they use is significantly high. Many customers saw this as a positive pro-local farmer moves from the brand.
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J.Co Donuts has a big ambition: to become the world’s leading donut and coffee company. The company has opened more than 300 stores worldwide. While the number is still inferior to Dunkin Donuts’ 7.000 stores, it is interesting to see the J.Co Donuts vs Dunkin Donuts competition in the future.
References Alice. (2009). Analisis kepercayaan terhadap merek dalam pengaruhnya dengan loyalitas (Studi kasus J.Co Donuts & Coffee). Universitas Kristen Maranatha. https://doi.org/10.1360/zd-2013-43-6-1064 Indarwati, T. A., & Tiarawati, M. (2015). Strategi pemasaran melalui experience dan emotional marketing terhadap kepuasan dan loyalitas pelanggan di J.Co Donuts & Caffee Surabaya. Jurnal Riset Ekonomi Dan Manajemen, 15(1), 102. https://doi.org/10.17970/jrem.15.150108.id Juddi, M. F., & Setianti, Y. (2019). Brand Strategy J.Co Donuts Indonesia (Analisis Upaya J.Co Donuts dalam Menjadi Top Brand di Segmen Donat Indonesia). Communication and Information Beyond Boundaries, 1, 244–254. Nurbaya, R. (2016, January 19). Rivalitas Dunkin Donuts dan J.Co di Indonesia. Money.Id. https://www.money.id/food/rivalitas-dunkin-donuts-dan-jco-di-indonesia-160119l.html
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