McDonald’s efforts at a strategic turnaround have so far focused on its core burger and fries concept, but the company is now placing some energy behind improving McCafé. Specifically, McDonald’s is looking for ways to compete more directly with premium coffee shops in major coffee shop markets like the UK and Australia. The company has been experimenting with ways to position itself as not just a price and convenience player, but as a true coffee-drinking destination—a difficult feat that, if successful, could help them tap into a lucrative and growing demand pool.
More dine-in traffic in the UK
The UK is one of the largest specialist coffee shop markets in value terms, at US$2.4 billion in sales in 2013; however just like in the US, McDonald’s sells McCafé products in the UK as a branded menu range, rather than through separate ordering counters or standalone outlets. As a result, English McCafés have never competed fully as third-place destinations in the vein of Costa or Starbucks.