McDonald’s mounts new raid on Starbucks

McDonald’s is charging onto the turf ruled by Starbucks and Dunkin’ Donuts with a makeover of its McCafe coffee line, brewing equipment and in-store design.

The chain also indicated that it will give the highly successful McCafe program, a business-within-a-business of sorts, more prominence in restaurants, starting in 2018. That effort will extend to a “sleek, modern look” for the McCafe portion of stores, headquarters said in the announcement, without disclosing additional details.

As part of what the franchisor calls a “relaunch,” the McCafe line will be extended to include espresso, sold straight as Americano or flavored as cappuccino. Three cappuccino flavors are offered: French vanilla, hazelnut and caramel.

One iced drink is included: a caramel macchiato, which is also available in a hot form. Sustainably sourced Arabica coffee beans will be used for at least one of the drinks.

McDonald’s said it has rolled out new espresso makers to all 14,000 units in the United States and will provide the needed training to turn employees into baristas.

As part of the new initiative, the chain said it will also permit the use of its name on a ready-to-drink frappe produced in partnership with Coca-Cola and sold in stores. A similar product is sold under the Starbucks brand name in partnership with PepsiCo.

Espresso drinks have been the stronghold of Starbucks. More recently, Dunkin’ Donuts added the stronger brew and disclosed a strategic plan to recast itself as a “beverage-led, on the go” concept, a departure from its earlier effort to become more of a full-fledged quick-service restaurant.

The McCafe program, imported from the chain’s Australian operations, was one of the few elements of McDonald’s business to remain strong during a sales downturn during the first half of this decade.

The initiative’s revamp, said McDonald’s USA President Chris Kempczinski, “is a central part of our growth strategy.”

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