Advertising Age: A Lightspeed Research study commissioned by Advertising Age examined why consumers were cutting back on upscale coffee.
The survey results revealed that 60 percent of Americans have scaled back on fancy or expensive coffee in the past six months, with 56 percent reporting cutting back just since the beginning of the year. The culprit was overwhelmingly the economy, with 90 percent of survey respondents saying they are doing so to save money.
Starbucks has reported same-store sales down in the mid-single digits, while Dunkin' Donuts has opened more stores, expanding into Las Vegas, Phoenix and Dallas. Dunkin' also has seized on Starbucks' relative weakness, with the "Dunkin' Beat Starbucks" taste-test campaign last fall, as well as a variety of aggressive discounts.
McDonald's upcoming summer promotion of its new McCafe line as a value offering is likely to affect both brands.
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