The coffee wars escalate between Dunkin’ and Starbucks.
starbucks (SEX) – Get a free reportit certainly has the largest market share in the coffee business. Still, one of its biggest competitors in coffee is Dunkin’ (DK) – Get a free reportwhich is making strides to take market away from Starbucks.
While Dunkin’ is a major player in the coffee business, it has more than 8,500 locations in the United States, the company says. Starbucks has more than 15,800 locations across the country, according to Statista.
Going after Starbucks is a brave move, but it’s a move Dunkin’ is prepared for. Coming after Starbucks by increasing locations seems a bit far-fetched, since that would mean opening more than 7,000 stores. However, Dunkin’ has another plan in mind: to have two big competitors come together to challenge Starbucks.
It seems there is a Starbucks in every city and in many locations across the street. Since Starbucks can survive with two stores in the same mall, taking it down requires a unique move. Dunkin’ is working to expand its product lines to make it more competitive with coffeehouse giant Starbucks.
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Dunkin’ takes an unlikely partner
With more than 200 combined years of experience between Coca-Cola (IS) – Get a free reportand Dunkin’, the two giant beverage companies have formed a partnership seeking to expand their businesses. Each company has a considerable part of their own business markets, but as much as they are in their own markets, they are competitors. Thus, two seemingly powerful competitors coming together is a unique opportunity for both companies to try to take market share away from a common competitor who rules the coffee market.
The Coca-Cola and Dunkin’ partnership has landed in grocery stores with its new Dunkin’ Iced Coffee in a can. Coca-Cola is the bottling company for the flavors provided by Dunkin’. The partnership will have three flavors inspired by Dunkin’ baked goods: Brownie Batter Donut, Cake Batter Donut and Coffee Cake Muffin, ready-to-drink iced coffees that use Arabica coffee, milk and cane sugar to create their iced coffees. The new flavors are listed at retailers including Walmart for $2.48 per can and have already received a five-star product review, according to Walmart.com.
The unique flavors are described as a rich chocolate flavor for the Brownie Batter Donut flavor, vanilla cake for the Cake Batter Donut flavor, and a cinnamon flavor for the Coffee Cake Muffin flavored coffee, according to Dunkin”s website.
“We value our loyal Dunkin’ customers and wanted to honor their favorite bakery selections in a delicious way that only Dunkin’ can do,” Brian Gilbert, Dunkin’ vice president of retail business development, said in a statement. “By infusing our famous iced coffee with the flavors of our delicious bakery delights, we’re thrilled to introduce the Bakery Series in partnership with The Coca-Cola Company to bring iced coffee drinkers a delicious new Dunkin’ option.”
Coca-Cola and Dunkin’ teamed up
The Coca-Cola Company and Dunkin’ have been working together since 2017, as the bottling company also produces other Dunkin’ Iced Coffee flavors in French Vanilla, Mocha and Original. So, to complete on a more level playing field, your best bet is to look for Starbucks’ line of retail products in supermarkets and convenience stores.
Both Dunkin’ Donuts and Starbucks are already in grocery stores in the coffee aisle with Keurig K-cups, retail coffee beans and other coffee products. Some grocery stores even have cafeterias within the grocery store itself. Starbucks has bottled and canned ready-to-drink coffee, and now Dunkin’ has the ability to compete in that product line as well with its new canned ready-to-drink iced coffee flavors.
