Beverage Industry

Brew Wars

March 1, 2006

Brew Wars

Competition in premium coffee just got tougher. Oak Brook, Ill.-based McDonald’s Corp. launched a new premium roast coffee this month that is about $0.30 less than Starbucks charges for its small-sized coffee. The stronger, richer blend of coffee comes in a new paper-covered Styrofoam cup with a black lid to reinforce its premium name.
McDonald’s push for a better brew is part of its effort to boost breakfast sales and pull customers away from rivals like Starbucks and Dunkin’ Donuts. And it’s a big market to pull from. Americans spent $34.5 billion on coffee in 2005, up 8.7 percent from 2004, according to industry reports.
Even though some customers might not want to pay $0.20 more for their 12-ounce coffee, McDonald’s is convinced that a heartier coffee combined with the convenience of its 13,000 drive-throughs will help to lure more of the “just-coffee” crowd.
The fast-food chain also is hoping to capitalize on increasing on-premise coffee consumption. According to the National Coffee Association, 39 percent of coffee drinkers consumed their brew outside the home in 2005, compared with 32 percent in 2001. The association reported that 16 percent of U.S. coffee drinkers bought their daily brew at a restaurant compared with 11 percent who said they bought their coffee at a Starbucks-style coffee shop. That’s a change from 2004, when 13 percent said they bought their coffee at a coffee shop, while 11 percent said they purchased it at a restaurant.
While McDonald’s also is testing specialty coffees such as lattes and espressos at 50 of its restaurants, Starbucks is more than doubling the number of stores — roughly 600 stores — that sell hot breakfast sandwiches this year. Whether or not premium coffee roasts will help increase food sales is yet to be determined, but coffee sales are sure to heat up.
RUM festival
Attendees at the International Cane Spirits Festival in March could follow the Rum Trail through the historic cobblestone streets of Ybor City in Tampa, Fla., sipping a variety of cane spirits. Sugar cane spirits from around the globe came together for a Rum Fest during the event, which gave participants the chance to taste products and meet distillers and importers.
Donation thanks
Bonnie McElveen-Hunter, chairman of the American Red Cross, visited The Gambrinus Co., San Antonio, Texas, to thank the brewer and importer for its contributions to the relief efforts following the hurricanes in the Gulf of Mexico. In addition to its $100,000 donation to the Red Cross, the Gambrinus team donated $200,000 to other charitable organizations in affected communities.
You’re hired
Smirnoff kicked off a nationwide search this month for the position of Smirnoff Cocktail Consultant, “the definitive expert on all things vodka drinks-related.” The newly hired Cocktail Consultant will spend his or her time researching cocktail culture across the country and providing twice yearly Smirnoff Cocktail Trend Reports. The lucky individual will receive a salary and expense budget of $100,000 to identify the latest in drinks for a one-year term.
Sending love overseas
Jones Soda, Seattle, partnered with Operation AC, a non-profit organization that supports service men and women overseas, to donate 10,000 Valentine Jones packs to troops stationed in Afghanistan and Iraq. The limited-edition packs contained two bottles of Love Potion #6, a specially designed flavor that “captures the taste of love;” Love Potion #6 Lip Balm; a CD sampler of songs by Sony BMG recording artists and a Jones Love Coupon Book, which includes a coupon for two free bottles of personalized soda from myjones.com.
Racing waves
Coors Light, the primary sponsor of the No. 40 car, driven by Chip Ganassi Racing with Felix Sabates rookie David Stremme, is creating Trackside Chats in conjunction with four races throughout the season. It gives fans a behind-the-scenes look at NASCAR through Stremme. The driver will comment on what it’s like to race in the Nextel Cup series and his experiences on and off the track. The first streaming audio file was available this month in conjunction with the Golden Corral 500 at the Atlanta Motor Speedway.
Shoe fetish
Carrie & Co., Napa, Calif., released a line of haute couture shoe designs for its DrinkWear coaster line. In time for spring, Carrie Olsen-Garrard, product designer, has produced collections ranging from golf, tennis, pink dress shoes, flip flops and scuba flippers. Dress and tennis shoes feature their own purse tote, and golf sets have a matching golf club caddy. Each coaster in a set varies in color, functioning as a clever way to distinguish one glass from the next. All sets range in price from $14.95 to $25.