Is McDonald's trying too hard to be Starbucks?

McDonald's (MCD -0.1%) holds an investor meeting this week with some restaurants analysts expecting a "coffee war" to be declared against Dunkin Brands' and Starbucks in a bid to grab more market share.

Though following the premium coffee path of Starbucks looks enticing, Hedgeye's Howard Penney speculates it could be backfiring for Mickey D's.

The company has become too distracted in stores and in the boardroom with coffee ambitions and strayed from its core burger-and-fries competencies, he postulates.

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Comments (5)
  • GregSoon
    , contributor
    Comments (149) | Send Message
    For about $11 you can buy a jar of Nescafe and make 100+ cups of coffee at home that tastes better than either #SBUX or #MCD coffee. #NSRGY
    11 Nov 2013, 02:45 PM Reply Like
  • daner
    , contributor
    Comments (32) | Send Message
    Backfiring? I live next to a McDonald's--and their breakfast business is unbelievable! Always a line at the drive-thru, people inside and outside, the parking lot is always full. I think people like their coffee and love their breakfast!
    11 Nov 2013, 02:57 PM Reply Like
  • Richard Adams
    , contributor
    Comments (275) | Send Message
    You're right, they sell a lot of coffee. But it's almost all the traditional drip brew. Espresso is a different product line that does not sell. It's good to hear your local McDonald's is doing well.
    11 Nov 2013, 03:12 PM Reply Like
  • Richard Adams
    , contributor
    Comments (275) | Send Message
    When the history of McDonald’s is discussed the Arch Deluxe (1996) is often mentioned as the biggest new product failure. Arch Deluxe was merely a bump in the road. The biggest product
    failure in the history of McDonald’s has been espresso based drinks. The typical McDonald’s sells two or three dozen espresso drinks a day while several billion dollars have been spent on new equipment and advertising espresso drinks at McDonald’s. Yet, as analyst Howard Penny has pointed out, McDonald’s management is obsessed with Starbucks and they will continue to force franchisees to waste more millions advertising espresso drinks.
    11 Nov 2013, 02:57 PM Reply Like
  • tall hawaiian
    , contributor
    Comments (2) | Send Message
    Customer tastes are always changing. Everyone cries make more healthy choices for customers but that's not what customers want. Unfortunately McDonalds customer base are bottom feeders just going for the cheapest menu items eating too much of it and than crying it's not healthy food. They have "good for you food also" . Espresso based drinks as well as smoothies are doing just fine in sales at McDonalds and you don't know this but McDonalds sells more drinks than food in the average store anyway.
    12 Nov 2013, 02:15 AM Reply Like
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