McDonald's Sees Rivals into Breakfast

McDonald's Sees Rivals Into Breakfast

McDonald's is currently under threat in her breakfast market as Starbucks Corp, the king of high-end coffee which is previously focusing on her beverage business, has started to introduce hot breakfast sandwiches in some markets and even plan to sell them nationwide. To take a reaction for the threat by Starbucks, McDonald began to introduce a more robust blend of coffee in order to keep the customer not moving to Starbucks. She also launched commercial campaigns in order to boost its coffee and breakfast sales. The internal report of McDonalds made the official worried as it showed there is a decrease in the breakfast traffic but an increase in the breakfast traffic of Starbucks and Dunkin's Donuts and other stores which imply that McDonald's breakfast traffic is shifting out. Thus, in order to maintain the sales, McDonald is trying to improve the perception of her coffee by introducing more robust blend of coffee. Actually, the breakfast traffic of McDonald is rather flat; the overall fast-food breakfast market has been growing and thus the revenue. However, with the new introduction of hot sandwiches by Starbucks and continuously introduction of new sandwiches of the currently hot sandwiches providers such as Dunkin Donuts and Burger King Corp, McDonald is still trying to adjust her response to react for the coming threat.

Every Company had utilized its specific strength to build a good image and to penetrate to the target market. McDonald uses the McMuffins, Hotcakes and McGriddles to target the breakfast market. Starbucks and Dunkin' Donuts use the wide variety of beverage to target the coffee market. However, in order to increase the total operating sales, companies not only increase the variety of the specific products (product penetration), but also try to increase the categories of the products (product development and sometime market development) which enable a firm successfully get a market share and segment as large as possible. We can see that Starbucks and Dunkin's Donut are trying to increase their product categories such as hot sandwiches to the market after they have achieved part of success in their coffee business. New categories of goods not only enable those firms to target new market segment of consumers, but also can increase the sales of the current products as coffee and hot sandwiches which are considered as related products. The new choice of products can