McDonald’s coffee versus Tim Hortons

McDonald’s is trying to make in-roads in the $22 billion coffee market with well-planned and well-timed free coffee giveaways. They are generating trial by encouraging customers to experience their premium blend coffee, an effective way to acquire customers, and their timing was perfect, coinciding with the launch of Roll up the Rim by Tim Hortons.  

Though McDonald’s coffee sales increased by 30% since they started free coffee giveaways and must have affected Tim’s sales during current Roll-up-the-ring, I am not sure if they gained market share from Tim Hortons.  There are three reasons for my premise:

The Omnipresent brand: Tim Hortons is one of the top Canadian brand. It’s said that until you like ice hockey, Tim Hortons and snow, you are not a Canadian. Moreover, it has far more outlets than McDonald’s, which is so convenient to pick up a coffee on your way and move on.   

–  Habit: Coffee drinking is a well-ingrained habit and we know how difficult it is to change habits. It may take McDonald’s many more free coffee giveaways to reach there.

–  Price: Though not a critical factor in influencing brand choice, price is a consideration for heavy coffee drinkers. McDonald’s coffee is a costly than Tim’s.

One small thing, however, can influence a shift towards McDonald’s coffee, the Tim Horton’s lids – hard to secure in place and pops up while you take a sip, often hitting nose, creating nuisance. I love McDonald’s lid, these easily sit in the grove while you enjoy coffee.

Both are great marketing companies, so I am amazed why McDonald’s hasn’t leverage this competitive advantage in their communications yet and I wouldn’t be surprised if fixing the lids is in-works at Tim Horton’s.

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