CASE: BASKIN-ROBBINS

Can it bask in the good ‘ole days?

It was early December 2003, and Baskin-Robbins Brand Officer Ken Kimmel had just returned from
lunch. To his surprise, his walk from the parking lot to the Randolph, MA headquarters building had
quickly turned into a sprint. Kimmel was trying to avoid the chilly effects of a Nor’easter that was
whipping most of New England with arctic winds.

Like the nasty weather Kimmel just escaped, the frozen food retailing industry had become more
hostile to Baskin-Robbins (www.baskinrobbins.com) in recent years. New entrants, such as Cold
Stone Creamery’s founded in 1988, had popularized the in-store experience with customers
watching their ice-cream creations being made before their eyes on cold stone slabs. For years,
Baskin-Robbins had turned their back to Cold Stone Creamery’s gains, in a similar way the Baskin-
Robbins counter staff turned their back on customers to make a banana split. Cold Stone Creamery’s
sales were now almost 75% of Baskin-Robbins’ sales.

In response, the Baskin-Robbins executive group along with Kimmel had recently moved to
redesign stores, but it was not easy convincing the thousands of franchisees who ran the Baskin-
Robbins stores to change. A store redesign could run up to $50,000 and was funded mostly by the
franchisees. One aspect of the redesign resulted in lowering the ice-cream cases to make it easier for
children to look down into the ice-cream bins.

Another change being considered was changing the Baskin-Robbins logo to coincide with the
redesign of store interiors. The logo appears on napkins, cone wrappers, spoons, cups, uniforms,
and signs at each Baskin-Robbins store. The estimated cost for making such a change was $5 million
for Baskin-Robbins headquarters. Individual franchisees would have to invest about $10,000 for the
logo change to be made inside the stores.

Later that afternoon, Kimmel’s brand group was deep in discussion about whether to change the
brand symbol of Baskin-Robbins at the same time stores would be redesigned,
“The context has changed since the mid 1980’s,” visiting retailing consultant Zack Wheatly said.
“Customers are more demanding about the hospitality experience. They earn more money and they
can buy comparable ice creams to Baskin-Robbins in grocery stores now.”

Kimmel sensed it was time to mention recent strategy decisions by the Baskin-Robbins executive
group.

1
“While our competitors are pushing this mix-in experience- a higher-priced theater experience-
Baskin-Robbins has decided to focus on delivering a great value for our consumers in an accessible
kind of environment,” Kimmel responded. “The executive group has decided that we are going to
focus on our new products as opposed to the theater of the business. As part of this new emphasis,
we have recently begun highlighting innovations such as our own frozen coffee beverage-the
Cappucino Blast-and a fruit-based beverage-Bold Breezes. Carrying frozen custard is also on the
horizon.”

Marsha Davis, Kimmel’s research director took her turn in the conversation. “ Is, Baskin-Robbins
such as established brand that the logo for Baskin-Robbins should not be overhauled?” Davis asked.
“I know what you are suggesting,” Wheatly replied. “Conventional wisdom in this industry would
say that one shouldn’t tinker with an established brand.”

“We have discussed this among ourselves here at headquarters with the CEO and other senior
executives, and we have also invested in hearing from consultants in retailing communications,”
Kimmel said. “They think the decision to change the logo should be taken only after extensive
deliberation and direct research with customers.”

“Right,” Wheatly said. “Analysis in the quick-service restaurant industry have reported in the trade
journals that the new entrants have continued to grow faster than Baskin-Robbins-especially in the
key metric of same-store sales compared the previous year. What did the qualitative research say
about the proposed new logos?”

Davis paused, dug in her briefcase, and removed the glossy printed versions of the old logo and the
leading candidate among proposed new logo. She put them both on the table facing the others.
“We talked with four focus groups in Chicago, LA, and New York and they agreed that the Baskin-
Robbins brand represented irresistible treats, smiles, and fun,” Davis said. “They also liked this
proposed logo that the senior executive group liked.”

“So where do we go from here?” Kimmel asked.

“Because your management wants to make a change to the logo only if it is necessary, you should
study your customers’ attitude toward the new logo, so that you can explain whether a logo change
is warranted,” Wheatly said.

Everyone stopped talking to reflect on what was just said. After about 10 seconds, Kimmel raised an
open hand to the group.

2
“Wait. This is beginning to remind me of the New Coke introduction,” Kimmel said after some
reflection. “Customers’ subjective attachment to the old Coke was ignored, then. We need to ask
about the old logo, too. Also, I know the senior executives want a clear margin of preference for the
new logo. If the new logo is not preferred 2:1 in a head-to-head competition with the old one, we
need to drop it.”

Wheatly picked up the line of thought.

“OK, and now that you mention it, we also need to present the drawings of the new redesigned
stores and have the customers respond to the old and new logos after understanding what our new
stores will be like,” Wheatly said.

“So restating our problem, I guess it sounds this way,” Davis said. “Because management wants to
make a change to the logo only if it is absolutely necessary, we should study our customer’s
attitudes toward the old logo and toward the new logo after showing them the drawings of the
redesigned stores. Only then can we explain whether customers prefer the new logo 2:1 over the old
logo.”

The words seem to hang in the air in the conference room at Baskin-Robbins headquarters. The
statement of the marketing research problem was sounding much improved to Kimmel. But he also
had the following thoughts: (1) Given that Baskin-Robbins had moved to redesign store interiors,
should the brand logo be changed to signal something new is happening at Baskin-Robbins? (2) If
the logo is changed, would there be synergy between the logo change and the redesigned interiors?
Synergistic results could be dramatic. A new look, a new menu, and a new strategy focused on
delivering “irresistible treats, smiles, and fun” in an accessible way and at a reasonable price could
check the momentum rival brands have developed by focusing on a high-end, in store experience.
Considering these elements, the strategic importance of the Baskin-Robbins’ research project
became more clear in Kimmel’s mind.

QUESTION 1

Explain the role of marketing research in deciding to change the logo in the case.

QUESTION 2

3
Identify and discuss the management decision problem confronting the Baskin-Robbins executive
group, along with Kimmel, and a corresponding marketing research problem and show the linkages
between the two.

QUESTION 3

If Kimmel decides to conduct a study to address the marketing research problem, what research
design should be adopted? Relate the different phases of the research design to specific aspects of
the marketing research problem.

QUESTION 4

Do you think that Kimmel should commission a survey in this case? If yes, which survey method
would you recommend and why?