Wednesday, April 2, 2014

Starbucks vs. Dunkin' Donuts

When it comes to coffee, there are two major names: Starbucks and Dunkin’ Donuts. While Starbucks and Dunkin’ Donuts are both trying to reposition themselves as eateries beyond breakfast, Dunkin’ Donuts is attempting into topple its rival by taking on a more fast-food restaurant strategy.

To create a substitute to another restaurant’s lunch menu, Starbucks has been reforming its lunch offerings for many years, to great success – the company now  “makes 50% more transactions per hour than it did in 2009.” (Cooper) Even the addition of La Boulange pastries has led to more mid-day meal items. And with the upcoming addition of wine to Starbucks’ menu, the company is attempting to counter customer power in the hopes that they will return multiple times throughout the day, rather than purchase a breakfast at Starbucks and a lunch at McDonald’s, for example.

Dunkin’ Donuts is still expanding its all-day menu, but the company has its sights set on beating Starbucks the same way Steele desired to beat Coke. Dunkin’ Donuts is creating what some refer to as the “McDonaldization of coffee,” prioritizing quick entry and exit and reliability above all. (Rodrick) Starbucks has created a community of lingerers – those who can wait for their coffee in exchange for the experience of purchasing coffee at Starbucks. Since Dunkin’ Donuts has always been more focused on service over experience, the company is using that to its advantage by targeting busier customers, who may be ambivalent about experience and who simply need a cup of coffee.


With both establishments seeking to penetrate the lunch and dinner market, and many other lunch and dinner establishments seeking to penetrate the breakfast market (McDonald’s for example), what happens next? Will all fast-food restaurants seek to become coffeehouses as well? Will coffeehouses attempt to become fast-casual or fast-food eateries? Is the specialty market on its way out?

Sources
Rodrick, Stephen. "Average Joe." New York Magazine. http://nymag.com/nymetro/news/bizfinance/biz/features/15139/

Cooper, Ted. "Starbucks quickly becoming a high-end McDonald's." Motley Fool. March 28, 2014. http://www.fool.com/investing/general/2014/03/28/starbucks-quickly-becoming-a-high-end-mcdonalds.aspx

1 comment:

  1. Have you seen this map?
    http://flowingdata.com/2014/03/18/coffee-place-geography/

    ReplyDelete

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