ANALYSIS OF THE BIG THREE
Operational Domain
McDonald’s and Dunkin’ Donuts are both part of the fast food, convenience segment, but have made strides to improve their image and atmosphere as they began to introduce their upscale versions of specialty coffees. In 2003, McDonalds remodeled its stores, added oversized chairs and softer lighting and colors, and installed free wireless internet service to its customers (Halpern, 2008). They still strive to beat Starbucks on price, by attempting to equal the quality of specialty coffee without the added expense brought by the elegant, homey atmosphere. Where Starbucks stores are all company owned, the McDonald’s locations are franchised. This gives Starbucks the ability to maintain more consistency across its locations.
Starbucks is most widely known and sought after for its specialty coffees. Many of its stores offer drive-through convenience, but it is Shultz’ envisions Starbucks being the “third place” people gather after home and work (Halpern, 2008). Their setting is one of convenient, fast food combined with an elegant, homey feeling that makes the consumer want to relax and stay a while. Starbucks prices are higher than the average coffee shop, but that is because they choose to differentiate themselves based on quality, specialty coffee and atmosphere as opposed to low price.
The customer is always the top priority, and Starbucks strives to provide a pleasant and satisfactory experience for every customer at each opportunity. From the moment the customer walks into the store, orders their product and either walks out or sits and enjoys the atmosphere, Starbucks pushes to provide the ultimate in coffee shop experiences. While providing a comfortable and relaxing experience for the customer to sit and enjoy, Starbucks provides opportunities for consumers to linger in their stores, providing wireless internet service in an indirect way to keep customers inside the store, lingering over their computers, and then perhaps ordering more products while they are there (Isidro, 2004) Journal of Case Research in Business and Economics
Coffee wars, page 6
ANALYSIS OF THE BIG THREE Operational Domain McDonald’s and Dunkin’ Donuts are both part of the fast food, convenience segment, but have made strides to improve their image and atmosphere as they began to introduce their upscale versions of specialty coffees. In 2003, McDonalds remodeled its stores, added oversized chairs and softer lighting and colors, and installed free wireless internet service to its customers (Halpern, 2008). They still strive to beat Starbucks on price, by attempting to equal the quality of specialty coffee without the added expense brought by the elegant, homey atmosphere. Where Starbucks stores are all company owned, the McDonald’s locations are franchised. This gives Starbucks the ability to maintain more consistency across its locations. Starbucks is most widely known and sought after for its specialty coffees. Many of its stores offer drive-through convenience, but it is Shultz’ envisions Starbucks being the “third place” people gather after home and work (Halpern, 2008). Their setting is one of convenient, fast food combined with an elegant, homey feeling that makes the consumer want to relax and stay a while. Starbucks prices are higher than the average coffee shop, but that is because they choose to differentiate themselves based on quality, specialty coffee and atmosphere as opposed to low price. The customer is always the top priority, and Starbucks strives to provide a pleasant and satisfactory experience for every customer at each opportunity. From the moment the customer walks into the store, orders their product and either walks out or sits and enjoys the atmosphere, Starbucks pushes to provide the ultimate in coffee shop experiences. While providing a comfortable and relaxing experience for the customer to sit and enjoy, Starbucks provides opportunities for consumers to linger in their stores, providing wireless internet service in an indirect way to keep customers inside the store, lingering over their computers, and then perhaps ordering more products while they are there (Isidro, 2004) Journal of Case Research in Business and Economics Coffee wars, page 6
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