tag:blogger.com,1999:blog-12540456.post7935855033418547901..comments2024-02-14T21:18:41.691-06:00Comments on Fast Food News: McDonald's coffee strategy hurting StarbucksUnknownnoreply@blogger.comBlogger2125tag:blogger.com,1999:blog-12540456.post-5093424351533814402008-07-11T17:18:00.000-05:002008-07-11T17:18:00.000-05:00There involvement in the culture wars will be a bl...There involvement in the culture wars will be a blessing to Starbucks then.<BR/><BR/><A HREF="http://jacklewis.net/weblog/archives/2008/07/apparently_mcdo.php" REL="nofollow">Apparently McDonalds Hates Christians</A>Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-12540456.post-70170984177851845772008-07-10T07:53:00.000-05:002008-07-10T07:53:00.000-05:00Economic theory about price elasticity of demand a...Economic theory about price elasticity of demand and when one product becomes an acceptable substitute for another certainly suggests that McDonalds coffee strategy is hurting and will severely damage Starbucks, especially since to date, Starbucks insists on saying that they are in a different market niche and is ignoring the threat.<BR/><BR/>The Starbucks fanatics also go out of their way to deny that anyone will switch, or even occasionally go to a McDonalds or Dunkin Donuts because they're more convenient, because there's just no comparison. But that's just foolishness -- we all know that even if you prefer Coke, you'll take a Pepsi (usually) if that's all the restaurant serves. Why would anyone think Coffee products are any different, especially when the foodservice giants make it faster and cheaper, and often have free Wi-Fi for those who want to linger in the store and do some surfing?<BR/><BR/>This is what low-end disruptive innovation is all about, and if Starbucks answer is to retreat to the high end where margins are bigger and to try to defend that turf, they will rapidly find themselves marginalized into a smaller and smaller niche as the low-end catches up and takes a large chunk of their market. (If Starbucks goal is to only serve the high end, then they have already created severe over-capacity, and we'll see lots more closings and layoffs ahead. You can read more at my blog: http://www.anti-marketer.com/2008/07/has-starbucks-g.htmlAnonymousnoreply@blogger.com