Print 27 comment(s) - last by Zoomer.. on Jan 11 at 6:57 AM

McDonalds goes after segment leader Starbucks

When it comes to fast food, McDonalds dominates the market. Likewise, Starbucks has grown to the point where you can't throw a rock without hitting someone carrying a grande Carmel Frappuccino with extra caramel or a tall Café Au Lait.

In its never-ending quest to expand its horizons and try new avenues to grow its business, McDonalds has in recent years gone directly after Starbucks with its own line of espresso coffees, iced drinks muffins and cakes. McDonalds offers the drinks and tasty treats in its slightly more "upscale" McCafe locations.

McDonalds' new line of coffees has received quite a bit of praise in recent times when compared to Starbucks offerings in taste tests -- and McDonalds' pricing not surprisingly undercuts the ever-escalating Starbucks prices.

Not content on topping Starbucks for flavor, McDonalds is now looking to tackle Starbucks when it comes to WiFi access. Coffee patrons often like to walk into Starbucks, place their notebook on a table and browse the Internet while listening to Carole King or Michael Bolton albums. Starbucks offers T-Mobile WiFi access in its 13,000 U.S. stores, but you of course have to pay to play.

McDonalds is also expanding the availability of WiFi access to its customers. McDonalds already offers WiFi access in half of its 30,000 retail locations across the country. The company has also committed to adding 14,000 more McCafe coffee bars to its restaurants -- all will feature WiFi access.

In an effort to further boost the appeal of its McCafe locations and WiFi access, McDonalds and Sony have partnered up to offer free WiFi service to Mylo COM-2 users in 9,000 McDonalds locations.

The expanded availability of WiFi access in McDonalds is surely a welcome addition, but it'd be interesting to see how many people actually want to sit in a McDonalds for an extended period of time.

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Seems counter to their normal image
By Flunk on 1/7/2008 11:25:25 PM , Rating: 3
This seems really weird, I would think that McDonalds would be better off launching a competing high-end coffee place but not branding it as Mc anything and squeezing Starbucks out with lower prices (it would not be hard).

Sounds like a real marketing blunder to me, but who knows I suppose it might work. As for me, I won't be going to a McCafe even if they do appear around here (Toronto, Canada) unless coffee can be had competitive Tim Hortons pricing (about $1.50 for a large).

RE: Seems counter to their normal image
By roadrun777 on 1/8/2008 12:10:54 AM , Rating: 3
I have to agree with it being a marketing blunder. The Mc"insert advert slogan here" style only cheapens it in the mind of the consumer.
I go to McDonalds to get a Mcburger, with Mccheese, then I go to the Mctoilet take a Mcdump and wipe my rear with Mctoilet paper. You see my point? Where does this madness end?

I don't even know what this COM 2 is, and usually Sony doesn't offer anything unless it's bundled with one of its exclusive products. So it sounds, to me, like I will have to buy something from Sony to get signed up for this COM 2.

If Mcdonalds offered straight wifi, for a set price (even offering annual payment options without all the branding silliness, they could have something worth using.

My only real issue with Mcd's is the quality of the tables and booths. Everything is made of plastic and laminated particle board, its like the whole store was hit by a plastic bomb and it coated everything with this ugly dull plastic shine. It doesn't matter how well you clean plastic, after its been used awhile it just looks uninviting.

If McD's added a completely SEPERATE area for the coffee bar, and really worked hard to make it look nice and feel comfortable it would probably be a success.
Also, it seems my local Mcd's is a local hang out for 50cent wannabe's, and I don't like the idea of sitting there with a thousand dollar laptop

By rdeegvainl on 1/8/2008 4:43:30 AM , Rating: 2
well maybe the whole setup will sound real secure, like mcafee?

RE: Seems counter to their normal image
By frobizzle on 1/8/2008 2:50:07 PM , Rating: 2
In an effort to further boost the appeal of its McCafe locations and WiFi access, McDonalds and Sony have partnered up to offer free WiFi service to Mylo COM-2 users in 9,000 McDonalds locations.

"Come in, have a super size McBurger, and a tall McFrappe, boot your laptop and leave with McHeartburn and a free McRoot Kit!"

By ethana2 on 1/8/2008 4:47:12 PM , Rating: 2
So if you're an italian running Ubuntu, do they kick you out?

RE: Seems counter to their normal image
By Christopher1 on 1/8/08, Rating: 0
By Yames on 1/9/2008 12:28:32 AM , Rating: 2
LOL, that is the whole point of rootkits, you don't see them.

Rootkits are still in their infancy for windows, they have been around for quite some time for *nix systems.

By rcsinfo on 1/9/2008 3:19:33 AM , Rating: 2
I think the ultimate success of this depends on what percentage of coffee drinkers are "grab and go" vs "stay and lounge". As the author's alluded to in his closing question, anyone who likes Starbucks for atmosphere is probably not going to start going to McDonalds.

I don't mean this as a slight on McDonald's in any way. It's just that McDonald's have been traditionally designed to turn over seats in the restaurant as fast as possible. Counter and kitchen procedures are constantly tweaked and measured for maximum speed. Chairs in the dining area are generally fixed to the floor and positioned with a rigid back that puts patrons closer to their food, as this supposedly makes a person eat faster. Flat surfaces and fake plants are easy to keep clean. Overall, McDonalds offers a consistent experience at a low price.

Starbucks on the other hand has much more of a lounge atmosphere with a mix of comfortable tables and couches. I often meet with clients and vendors at Starbucks. They're easy to find, comfortable, and offer a good atmosphere for small informal meetings. The taste of their coffee is not the only factor - atmosphere plays a big role.

However a big question is how many people stay and drink their coffee vs. take it to go. I'm sure there are plenty of people who hit the Starbucks drive-thru on the way to work every morning. Now if McDonalds can offer the same tasting cup of coffee for a lower price with faster service, then maybe they could carve a nice chunk out of Starbucks's business.

does this include canada
By raphd on 1/7/2008 9:31:55 PM , Rating: 5
Do those locations include any in Canada? there is a mcd's about a block away with LCD tv's fireplace and such, but when I asked at the counter if they had wifi and the clerk looked at me like i just raped a baby.

RE: does this include canada
By Oroka on 1/7/2008 9:57:20 PM , Rating: 3
LMAO, really? They just finished doing the exact same reno to my local Rotten Ronnies (here in Canuckastan). I would almost call it 'classie' with all the wood and granite. I have to admit, the fireplace coffee nook thing is pretty snazzy, with the 42" Panasonic plasma on the other side of the wall!

I havent heard of any wireless access yet. Dont get mad at the teen behind the counter, they know even less than they are told.

RE: does this include canada
By firdooze on 1/7/2008 11:41:29 PM , Rating: 2
There's already free WiFi here in Singapore @ McDonalds and Starbucks (& Burger King, Coffee Beans, etc) since 2 years back. I must say, it was a great move!

RE: does this include canada
By Zoomer on 1/11/2008 6:57:46 AM , Rating: 2
Unfortunately, the service now sucks. Too much traffic, too narrow of a pipe.

RE: does this include canada
By Christopher1 on 1/8/2008 11:03:00 PM , Rating: 1
That is funny, cause it is true. Most teens only want to know VERY little, the bare minimum, about the minimum wage job that they work at.

Heck, when I was working at Wal-Mart, I tried to do the barest MINIMUM of work (which I found out was more work than the other cart pushers were doing) that I could get away with.

Am I the only person left....
By Vanilla Thunder on 1/8/2008 10:11:28 AM , Rating: 3
Who owns a coffee pot and makes their coffee @ home? I understand the need for a delicious latte' now and then, but the last thing I want to do on the way to work in the morning is stand in line for a cup of joe. Just my $0.02.


By Mitch101 on 1/8/2008 10:34:38 AM , Rating: 2
I agree with you that brewing a cup of Joe at home is not only cost effective but prevents me from sitting in line waiting for a cup of coffee while the idiot in front of me cant make a decision.

McCafe though kills any other coffee houses around it. The prices are not bad either.

$2.50 coffee's add up at around 1 a day for a year is around $600.00 a year.

As a comparison a Cell Phone $40.00 a month = $480.00.

Brew at home Maybe $15.00 a month = $180.00. Save yourself $420.00. That gives you room to buy that expensive coffee maker instead of the $20.00 one.

RE: Am I the only person left....
By JoshuaBuss on 1/8/08, Rating: -1
RE: Am I the only person left....
By fic2 on 1/8/2008 12:07:23 PM , Rating: 2
The funny part is that you would think that folgers tastes anything like coffee....

RE: Am I the only person left....
By ethana2 on 1/8/2008 4:49:09 PM , Rating: 2
If it still counts as 'coffee', I can't drink it ;)

By Christopher1 on 1/8/2008 11:00:34 PM , Rating: 1
My parents have a coffee pot, and they don't see the point of buying a cup of coffee from McDonald's in the morning either, unless they are ALSO stopping for a meal there.

Personally, I don't drink hot coffee (iced for me, and then only extremely rarely) and I never understand why people would overpay for a cup of coffee like they do. Hell, I can buy a whole BAG of coffee, with enough for 200 cups, for less than the price of ONE latte or cappucino.

Oh I'd totally do it too
By dflynchimp on 1/8/2008 12:04:01 AM , Rating: 2
Free public internet in food places is hard to come by these days. while McDonalds doesn't for the love of god look anything close to cozy like most coffee shops, having a free-internet equipped McDo would be a huge draw for me when deciding on lunch (that and the dirt-cheap dollar menu XD)

RE: Oh I'd totally do it too
By fic2 on 1/8/2008 12:06:15 PM , Rating: 2
Really? I think most places in Denver, except FiveBucks, have free wifi. When I was in Sunnyvale, CA on business most places except my hotel had free wifi. Instead of paying the hotel $12 I went to a local pub had a beer or two and surfed the web for free.

By Fnoob on 1/8/2008 9:40:17 AM , Rating: 2
Now if they could just make some food that doesn't suck. Help me understand just what is big about a Big Mac?

You can't polish a turd.

Ha Ha
By Dalceon on 1/7/08, Rating: -1
RE: Ha Ha
By PandaBear on 1/7/2008 10:33:57 PM , Rating: 1
Their coffee is pretty good (Farmer's brother), I am not sure what you mean but Starbucks aren't that great either, so if you only not go to McD because of "image" but goes to Starbucks because of "image" you have something to work out personality wise.

RE: Ha Ha
By Dalceon on 1/7/2008 10:47:19 PM , Rating: 2
Can I not have an opinion that doesn't show a personality problem. I personally don't like they're coffee, lattes etc. If you like it, keep buying it. I've tried to not go to Starbucks, but no one makes a latte quite like they do.

RE: Ha Ha
By The0ne on 1/8/2008 4:06:06 AM , Rating: 2
Lol, you mean no other place can make coffee that "you" like. You just proved and countered your own point. If I'm not mistaken a recent (hope so or I'm getting too own to remember things) survey showed MaCoffee being prefer more than Starbucks. And I believe due to taste as well.

But what's good for you ain't good for another...rather one man's trash is another man's gold, blah blah blah :P

RE: Ha Ha
By Starcub on 1/9/2008 1:58:50 PM , Rating: 2
Starbucks is driven by the bottom line. Their products are expensive, and they are a socially irresponsible and immoral company. Find out more here:

McDonalds is obviously cheaper and a little more socially responsible, but neither company really offers fair trade products.

If I want coffee, I go to Dunkin Doughnuts. They have decent fair trade coffee and Frapachino's that IMHO, are almost as good as Starbucks. They also have some surprizingly good bagels.

"And boy have we patented it!" -- Steve Jobs, Macworld 2007

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