How to Conduct and Prepare a Competitive Analysis | Edward Lowe Foundation.
Starbucks began over 50 years ago with a single location in Seattle, Washington. Since then, it has experienced phenomenal growth and is now the largest coffeehouse chain in the world. From its humble beginnings as a Seattle-based coffee roaster, Starbucks has strived to create a “second home” for consumers, where they can stop on their way to and from work. In recent years, the company has invested heavily in its brick-and-mortar locations by expanding its food options, remodeling its restaurants, and revamping its rewards programs.
Like many other retail or restaurant companies, Starbucks was negatively impacted by business restrictions implemented for COVID On March 4, , Starbucks paused the use of personal cups and restricted company-wide business travel. Eleven days later, Starbucks temporarily moved to primarily drive-thru only for the United States.
However, proved to be a much strong year. Today, Starbucks continues to innovate through new sustainable practices and commitments. With big plans in the future for its product and future growth of its already existing 34, stores, here’s how the company stacks up against its competitors. Dunkin’ Brands-owned Dunkin’ Donuts peacefully co-existed with Starbucks for decades.
When the spokesman for the company’s ad campaigns retired in the late s, however, Dunkin began to transition away from coffee and in the direction of donuts.
By the early s, the company had introduced its first specialty coffee line and slowly began to make a name for itself as a destination coffee shop. Dunkin’ Donuts has more than 11, locations across 36 countries. Within the United States, Dunkin’ Donuts operates out of 41 different states.
In , Dunkin’ upped the ante and declared war against Starbucks when it launched its “America Runs on Dunkin'” ad campaign. While Starbucks has created an intentionally chic and upscale environment, Dunkin’ Donuts represents itself as an All-American brand.
This acquisition included the purchase of other brands including Baskin-Robbins. As Inspire Brands is a private company, it is not required to publicly disclose many financial metrics. With the potential to capitalize on a diverse leadership team and economies of scale , Dunkin’ Donuts continues to rival Starbucks in the coffee industry. McDonald’s has long been known as a fast-food restaurant, but the global franchise joined in on the emerging coffee craze by introducing flavored and iced coffees in the mids.
After leaning on the “I’m Lovin’ It” advertising campaign for more than 10 years, McDonald’s recently pivoted to embrace the everyday American with emphasis placed on people of every educational and cultural background. McDonald’s operates more than 36, restaurants across different countries.
There is a storefront in every state across America, though Montpelier is the only state capital without a McDonald’s.
The McCafe line of products has grown to 23 different drinks. To further rival Starbucks pastry, McDonald’s also boasts an independent product line of McCafe bakery products. McDonald’s remains committed to the long-term success of its coffee line. In the company’s Annual Report, McDonald’s stated it is “committed to the core by tapping into customer demand for Starbucks has also entered the coffee beans and ground coffee market by distributing its product line to retail and grocery stores around the world.
In the process of expanding its retail segment, Starbucks has gained two new competitors: Maxwell House and Folgers. Kraft Heinz has previously evaluated whether or not to sell the Maxwell House product line. For now, the subsidiary remains with the company.
Maxwell House is one of the more recognizable subsidiary brands of Kraft Heinz. Kraft used to be the exclusive manufacturer to license and distribute its McCafe coffee in retail outlets, but McDonald’s opted into a new long-term agreement with Keurig in Kraft Heinz has been reimagining Maxwell House products to compete with Starbucks in the environmentally sustainable product sector.
The company also reduced material inputs of packaging in New Zealand to save 28 tons of material a year. However, Maxwell has not been able to capture success in the market in the past few years. Acquired by The J. M Smucker Company in , Folgers also boasts a diverse product line that prides itself on convenience. It’s diverse product line includes ground coffee canisters, K-Cup pods, instant coffee jars, and single-serve packets.
Folgers also does not have physical storefronts. Through the first three quarters of Smucker’s fiscal year, U. With physical locations around the world, Starbucks competes with McDonald’s and Dunkin’ Donuts in dozens of international storefronts. Starbucks differentiates itself by creating a “third home” value proposition. In addition to home and work, the company strives to have a welcoming, warm location for customers to consume their products. Alternatively, competitors like McDonald’s and Dunkin’ Donuts strive for lower prices for goods more likely to be consumed offsite.
Starbucks is the largest coffee company in the world. Dunkin’ Donuts. Inspire Brands. Kraft Heinz. Smucker Co. Announces Fiscal Third Quarter Results. Company News.
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Popular Courses. Table of Contents Expand. Table of Contents. Starbucks, the Industry Leader. Maxwell House and Folgers. Starbucks FAQs. Stocks Top Stocks. Starbucks, the Industry Leader Starbucks began over 50 years ago with a single location in Seattle, Washington. Starbucks operates over 34, stores and is embarking on aggressive measures to reduce waste and product efficiency.
Dunkin’ Donuts was acquired by Inspire Brands in and now has the ability to leverage economies of scale.
Folgers and Maxwell House rival Starbucks with in-home coffee products, though their rivalry is limited due to a lack of storefronts. Article Sources. Investopedia requires writers to use primary sources to support their work.
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Partner Links. Related Terms Franchisor Definition A franchisor sells the right to use its brand and expertise to one who will open another branch of the business to sell the same products or services.
Cyber Monday Cyber Monday is the Monday following American Thanksgiving, representing the day online retailers offer deep discounts. What Is a Franchisee? Franchisee refers to a small business owner who purchases the right to use an existing business’s trademarks, brands, and proprietary knowledge.
What Is the Starbucks Index? The Starbucks Index is a measure of purchasing power parity comparing the cost of a tall latte in local currency against the U. What Is Target Market? A target market is a selection of individuals who have been identified as potential customers for a product. Investopedia is part of the Dotdash Meredith publishing family.
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