Why Krispy Kreme’s Doughnut Giveaways Hit a Psychological Sweet Spot

Krispy Kreme’s “Day of the Dozens,” just held this year on Thursday, December 12, offers proof that nothing spreads holiday cheer like a sweet deal. And the universal love of something free, according to a report in Forbes.

The annual deal offers a simple holiday delight: buy any dozen doughnuts, and Krispy Kreme will hand you another Original Glazed dozen for free. But for many, this promotion isn’t just a bonus. It’s an opportunity to bring a smile to coworkers, friends or family.

What’s more, the psychology behind these types of “Buy One, Get One” (BOGO) deals runs deep, the Forbes article notes. According to a study published in the Journal of Business Research, free deals make us feel rewarded and valued, turning simple purchases into memorable experiences. Krispy Kreme’s offer captures this spirit perfectly, using the holiday season’s themes of abundance and sharing to make their offer feel extra special.

One key factor is the Zero Price Effect, which suggests that we respond to the cost of “free” differently than we do any other price. The allure of “zero” creates an emotional response that overrides rational decision-making, according to 2007 research by Shampanier, Mazar and Ariely.

Indeed, demand skyrockets when something is free, even what it’s only marginally more valuable than a paid alternative. For indulgent products like Krispy Kreme’s doughnuts, the emotional appeal is especially strong. Such pleasure-driven, “hedonic” treats feel extra rewarding when there’s no price attached.

Adding to this are the effects of loss aversion, a theory developed by the economists Daniel Kahneman and Amos Tversky. This theory holds that people naturally avoid losses more than they seek equivalent gains. It’s also one of the main implications of Prospect Theory. A framework outlined in the duo’s 1979 paper that’s since become the most cited in economics and one of the most cited in psychological sciences.

Overall, the thrill of getting something for free thus easily overshadows the lure of discounts. And you can add to that the principle of reciprocity, the unspoken rule that makes us want to give back when given something.

When Krispy Kreme hands you a free dozen doughnuts, it’s difficult not to want to pay it forward. Whether that’s by picking up another dozen for a friend, sharing your stash or just telling everyone about the deal.

Sounds like a treat in the making for marketers.

Brand idea for Krispy Kreme’s ‘Day of the Dozens’: ‘Sweetness. Better when shared.’

Krispy Kreme could play on the strengths of the “Day of the Dozens” promotion through additional limited-run giveaways of items. Examples of these items could include camping-style “Krispy Kreme Coffee Sharing Pots” for the first few people who take advantage of the promotion at select store locations. Such physical giveaways could have the added benefit of being social media shareable and viral.