Espresso Wars: McDonald's Coffee Vs Starbucks in Kansas City

In spite of the minor stock improvement on January 7 (a result of Starbucks replacing CEO Jim Donald with former chairman and chief executive Howard Schultz), Starbucks has been on the decline. According to the Wall Street Journal, Starbucks' shares have declined 48% over the past year. There are many hypotheticals that could be analyzed to explain this trend, but it would be better to anticipate and watch how McDonald's is beginning to challenge and will continue to challenge Starbucks' beverages with their new lineup of McCafe Specialty Coffees.

As Starbucks' shares went down throughout the 2007 year, McDonald's' shares increased by 31%. This improvement reflects the attempts McDonald's' has been making to raise product quality. As a previous employee, and occasional consumer of BOTH companies, I can easily see the improvements that McDonald's' has been making with their coffee beans.

McDonald's' coffee is indeed gourmet compared to what it used to be years ago. The coffee machines have improved and overall bean quality has improved. However, McDonald's' coffee has never been able to compare to the quality that Starbucks can offer. McDonald's' coffee is perfect for those that don't really enjoy the flavor of coffee but just want a caffeine fix because the water to bean ratio is not where it should be. McDonald's' coffee is overall not consistent and watered down, whereas Starbucks offers a wide variety of coffees from Asia, Arabia, Africa and South America. Each Starbucks' coffee is distinct with different subtle flavors because of the region in which they were harvested.

I realize that there are many avid coffee fans, with their loyalties to one or the other company. McDonald's fans undoubtably have a better price, and overall their coffee is better for a mild coffee (since it is watered down). Starbucks fans pay more for a higher quality coffee that some may argue has a burnt taste, but in actuality this burnt taste isn't an issue of over roasting, but simply a preference for a coffee with a darker flavor.

This McDonald's vs. Starbucks challenge will prove to be interesting as they now compete head to head in offering espresso based beverages. This is a new angle for McDonald's and their introduction of McCafe Specialty Coffees in approximately 800 stores throughout the nation has been off to an acceptable start.

While visiting relatives in Kansas, I was able to experience a latte from a McCafe McDonald's. As I was sipping my latte outside (because I didn't want the scent of hamburger to affect my judgment) I could tell that the latte was off somehow. It could be that the overall quality of the espresso bean was not up to par, or it could be related to the espresso machine not being cleaned properly or calibrated properly. However I can see why many people would enjoy and welcome this McCafe drinks because it had a milder coffee flavor which I know is the preference of some coffee drinkers.

Currently McDonald's' McCafe Signature Coffee Drinks are facing some disadvantages. Their espresso did not taste as strong as it should in a 12oz latte compared to a Starbucks' latte. Also as the Barista position is new at McDonald's many of their employees are not as well crafted with making espresso drinks as Starbucks Baristas are. And Lastly McDonald's currently does not offer as many options that one can easily get at Starbucks. The McCafe I visited was only offering three syrup choices, while Starbucks easily offers over twenty. Additionally the McCafe I visited did not carry organic or soy milk, which Starbucks offers (although it took them a few years of establishment to consider and finally offer these options).

In conclusion, the winner of this espresso war ultimately depends on your own personal coffee taste. Those that like mild coffee or like to hide the coffee flavor with sugar would prefer McDonald's, while those that like darker coffees will undoubtably choose Starbucks. But just because McDonald's does not appear to be winning this espresso war right now, does not mean that Starbucks should discredit the competition that McDonald's will pose to their company as McCafes become more present throughout the nation.

McDonald's has a lot of room for growth, and if past trends are any indicator of what the future holds, then McDonald's will continue to improve their espresso bean quality and possibly make Starbucks shareholders panic.