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10 Possible Starbucks Responses to McDonald's Coffee Threat

SBUX vs. MCD 1-yr chart - Seeking Alpha By Bill Conerly Syndicated from Seeking Alpha blog January 09, 2008 I've used Starbucks' ( SBUX ) business strategy as a way to discuss the Trial and Error Economy. I'm not, by any means, the world's greatest expert on the company, but it provides a great vehicle for teaching about corporate strategy. Now, according to the Wall Street Journal, McDonald's ( MCD ) will sell premium coffee drinks made by baristas at most of their 14,000 stores. How should Starbucks react to the McDonald's threat? Here are some ways: 1. Do nothing. Best implemented with one's nose high in the air, saying that Starbucks customers would never buy coffee at McDonald's. Would work very well for three to six months. Ignores the reality that Starbucks' recent growth has come not from Volvo-driving college grads, but from lower-income, less educated people than they originally served. These are people comfortable at McDonald's. 2....

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