McDonalds Foray Into The Coffee Industry

The Wall Street Journal covered McDonalds’ plans to bring baristas and coffee bars to its 14,000 locations. Writer Wendy Bounds made an interesting observation that McDonalds will compete with Starbucks, but not necessarily the smaller shops.

Starbucks has truly created the coffee industry and made it possible for smaller chains like Cuppy’s Coffee to even exist. It is interesting, however to see how Starbucks has become more like McDonalds in that they have streamlined their processes. Because Starbucks is a public company its decisions are driven by profits. Smaller, locally owned chains like Cuppy’s Coffee can still focus on what the customers want. This means hand-pulling each espresso shot and staying true to the Italian barista-customer experience. I would not call McDonalds move into the coffee market as the saving grace for smaller shops, but I do not think they will not be able to provide what the smaller coffee shops can.

While the smaller shops gain customer loyalty through authenticity and by offering a sense of community, to some customers a cup of coffee is still just that, a cup of coffee. If McDonalds is offering gourmet coffee too, it is just one more option for consumers and it all boils down to location and convenience.