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JAN 9

10 Possible Starbucks Responses to McDonald's Coffee Threat

Seekingalpha.com, January 9, 2008 — I've used Starbucks' (SBUX) business strategy as a way to discuss the Trial and Error Economy (here and here). I'm not, by any means, the world's greatest expert on the company, but it provides a great vehicle for teaching about corporate strategy. Now, according to the Wall Street Journal, McDonald's (MCD) will sell premium coffee drinks made by baristas at most of their 14,000 stores.

How should Starbucks react to the McDonald's threat? Here are some ways:

1. Do nothing. Best implemented with one's nose high in the air, saying that Starbucks customers would never buy coffee at McDonald's. Would work very well for three to six months. Ignores the reality that Starbucks' recent growth has come not from Volvo-driving college grads, but from... continue reading

Category: Brand Strategy
Tags: McDonald's, Starbucks, Competitive strategy, customer loyalty
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