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McDonald’s Takes on Starbucks With New Cold Brew Menu

Expect new frozen coffee and Frappuccinos at Mickey D's

By Karl Utermohlen, InvestorPlace Writer

http://bit.ly/2sV4qh5

McDonald’s Corporation (NYSE:MCD) is taking aim at Starbucks Corporation (NASDAQ:SBUX) by rolling out a new cold brew menu, including frozen coffees and Frappuccinos.

McDonald's
Source: Flickr

The burger chain announced that it is expanding its McCafe business even further by rolling out a new line of cold brew frozen drinks, including the Cold Brew Frozen Coffee and Cold Brew Frappé. The launch comes following McDonald’s making the decision to enter the espresso category last September as part of a “McCafe relaunch.”

The chain is hoping to compete with Starbucks, which has opened more than 2,000 new cafes in the U.S. over the past three years, bringing it a bigger domestic footprint than McDonald’s. However, the burger chain may be gaining ground with this move as it will attract consumers who are less loyal and more cost-conscious during the afternoon hours.

Adding cold brew coffee will help McDonald’s take advantage of the growing interest from American consumers in cold and frozen beverages as the total U.S. sales of refrigerated cold brew coffee has increased an astonishing 460% from 2015 to 2017. The industry is slated to reach an estimated $38.1 million by the end of this year.

Elina Veksler, senior director of McCafé Menu Innovation, said the decision to roll out new cold brew drinks will bring consumers variety, quality and consistency.

MCD stock is up 0.3% on Wednesday following the news, while SBUX shares declined about 0.3%.


Article printed from InvestorPlace Media, https://investorplace.com/2018/06/mcdonalds-cold-brew-starbucks/.

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