Should Krispy Kreme go healthy?

Still in a fragile recovery, the doughnut chain looks to yogurt, juices and specialty coffees to sustain momentum.

By Kim Peterson Jun 22, 2011 3:21PM
Krispy Kreme (KKD), a name you can hardly speak without salivating, is having a great year. Shares are at $9 -- double what they were a year ago. Profit and sales are on fire.

So in order to keep momentum going, the company is ... getting healthier?

Chief executive James Morgan wants to add oatmeal, yogurt and fruit juice to the menu, Bloomberg Businessweek reports. He's also looking at specialty coffee, starting with custom blends in September and espressos and lattes over 18 months.

Homer Simpson would be disappointed, and I admit I am as well. You visit Krispy Kreme to indulge in a warm, sugary bit of heaven that melts in your mouth. That's what turned the doughnut chain into a superstar. You don't go there for oatmeal.

But Krispy Kreme needs to increase sales and maintain its fragile recovery. It was only six years ago that the company imploded in an accounting scandal and a series of bad management moves. Krispy Kreme closed half of its 390 stores and suffered 14 quarters of losses, Bloomberg Businessweek reports.

Check out the following video interview of a Krispy Kreme analyst, who says people drive past Dunkin' Donuts just to get to Krispy Kreme.

Post continues after video:
Business is much improved. Now, the store is taking a cue from McDonald's (MCD), which has seen fantastic results from its McCafe line of coffee and espresso drinks. And it's also stealing a bit of strategy from Starbucks (SBUX), which upgraded its menu with healthier eating options.

One food marketing professor says Krispy Kreme can target people in their 20s and 30s who may not be the Starbucks aficionados that other generations are. "Starbucks isn't really their brand," Nancy Childs told Bloomberg Businessweek. "Krispy Kreme has room to step up."

Krispy Kreme will still have its signature doughnuts. And even as it turns healthier, it's giving the carb-loving, calorie-consuming masses something else to drool over: doughnut milkshakes. The Daily Mail reports that the company is testing milkshakes at a handful of stores in three flavors: chocolate cake, raspberry-filled and, of course, original glazed.

8Comments
Jun 23, 2011 3:19AM
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Okay...I'm with the writer of this story on this one. People don't go to Krispy Kreme to find their healthy food, they go to eat a donut and not just any donut, but in my opinion a sublime treat for your taste buds. I have changed my ways and make healthful choices now but I will always remember my first bite of the still warm, perfectly done glazed Krispy Kreme donut. While I'd love to take a sip of one of those milkshakes they're developing I know I won't, my choice but for pete's sake let it alone. I can't even fathom someone walking into a KK shop to order oatmeal!! One whiff of that heavenly scent of donuts would be enough to make a person's head spin with resentment over the fact that they're not going to get a donut but oatmeal! Please let people who choose to enjoy these things, treat themselves without guilt and let those that want to make healthier choices do it somewhere realistic and expected...not where they're going to be faced with the ultimate temptation. Do one thing really well and quit trying to please everyone. Just my two cents.
Jun 23, 2011 4:18AM
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I just  bet you know more than anyone on any subject.

Jun 23, 2011 4:54AM
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I don't get why people are so against Krispy Kreme adding healthier options. I can recall many times when I was forced to go into a place just because that was the only place near  or my parents were only stopping there and refused to go somewhere else. I would have liked more options. More variety is a good thing...if you went to Krispy Kreme to have a donut...have a donut, if you happen to want something else....you'll have choices. It's a win.
Jun 23, 2011 5:21AM
Jun 23, 2011 4:55AM
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Okra you really are an idiot! Sure Dunkin Donuts are good but, what the hell? You must work for DD trying to help them out. KK are nationwide, hell we've even seen KK here in AK, where's DD? Not here in AK. I grew up on both and would love to see a DD here but, it's not happening. Why is that?
Jun 23, 2011 8:01AM
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okra: pls do as your "name" suggests:  go eat some slimy boiled okra. You have got to take a pill for that anger management or you're going to drop dead from a heart attack not donuts.

It's just donuts! Not that important.

Jun 23, 2011 7:57AM
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DD's are not fresh. there made who knows where and shipped to the store. you can watch KK's being made. nothing wrong with eating healthy. Hell i need to. but KK rules.
Jun 23, 2011 6:28AM
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My husband has some great recipes for a healthier sweets that have great commercial money making potential, but he feels if he markets someone would just steal it. So, what to do?
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