Dunkin’ Donuts and McDonald’s are the New Starbucks
Sometimes, the easiest targets for consumer backlash are the least to blame.
Case and point, The Latte Factor.
Anyone familiar with the writings of David Bach will know about one of his signature teachings. He points with great flair in his books that people usually don’t realize the amount of money they spend on a daily basis. The frugally unsavvy go through their lives complaining about never having enough money to save while chugging down $4 lattes accompanied by $3 muffins.
So what happens when the reigning king of lattes begins to slip? Starbucks (STAR) is off 10% year to date. Recent competition in their prime marketplace, that of premium coffee, has come from upstart McDonald’s (MCD) as well as Dunkin’ Donuts. Coincidently, the golden arches are up 3% year to date. Dunkin’ Donuts are privately owned franchises and is not publicly traded.
So what is it going to be now that lattes are out and 99 cent premium coffee are now the rage? The Dunkin’ Factor? The McD’s Factor?
It is a paradigm shift and Starbucks is on the losing end of the bargain.
Later in life, no one will ever care how fancy your coffee was or what fancy name it was called. A dollar is a dollar to your bank account though. Food for thought.