coffee wars

{{Short description|Competition between coffee businesses for market share}}{{About|marketing tactics in the coffee industry|the armed conflict during the Algerian War|Café Wars}}File:Tim Hortons reflection.jpg involve the largest coffeehouse, Starbucks, pictured here reflecting a sign for Tim Hortons in New Westminster, Canada.]]

Coffee wars, sometimes referred to as caffeine wars, involve a variety of sales and marketing tactics by coffeehouse chains and espresso machine manufacturers to increase brand and consumer market share.{{Cite news|last=Sylvers|first=Eric|url=https://www.wsj.com/articles/lavazza-and-illy-say-basta-as-global-coffee-wars-come-to-italy-1539432052|title=Lavazza and Illy Say 'Basta' as Global Coffee Wars Come to Italy|date=October 13, 2019|work=Wall Street Journal|access-date=April 20, 2020|language=en-US|issn=0099-9660}}{{Cite news|url=https://www.economist.com/business/2008/01/10/coffee-wars|title=Coffee wars|date=January 10, 2008|newspaper=The Economist|access-date=April 14, 2020|issn=0013-0613}} In North America belligerents in these wars typically include large coffeehouses, such as Starbucks,{{cite news|last=Hughes|first=Jennifer|url=http://nreionline.com/retail/coffee-wars-continue|title=The Coffee Wars Continue|date=20 November 2012|newspaper=National Real Estate Investor|access-date=12 April 2013}} Dunkin', McDonald's,{{cite news | last =Hill | first =Chris | title =1 New Player In The Coffee Wars | newspaper =Motley Fools| date =13 February 2013 | url = http://www.fool.com/investing/general/2013/02/13/1-new-player-in-the-coffee-wars.aspx | access-date =12 April 2013 }} and Tim Hortons.{{Cite web|url=https://www.theloop.ca/mcdonalds-just-turned-up-the-heat-in-the-coffee-wars-against-timmies/|title=McDonald's just turned up the heat in the coffee wars|last=Hiscock|first=Michael|date=December 19, 2020|website=The Loop|language=en-US|access-date=April 10, 2020}} According to The Economist, the largest coffee war of the late 2000s was between Starbucks and McDonald's in the United States. The U.S. market has, since the early 2010s, been primarily contested by its two largest players, Starbucks and Dunkin'. Since 2020, competition over the Chinese coffee market has intensified between Starbucks and Luckin Coffee.

Periods of low economic activity and business recessions––which contribute to diminished consumer demand––have been linked to an increase in coffee wars. Major innovations in the coffee industry, particularly the advent of single-serve espresso pods, have lowered the market's barrier to entry. Although store count has been traditionally seen as gauging market share, both firms and analysts have incorporated revenue, balance sheets, organic growth, operating margin, and stock market performance as comparable indicators.{{Cite web|url=https://www.fool.com/investing/2020/02/08/forget-coronavirus-these-3-starbucks-metrics-matte.aspx|title=Forget Coronavirus: These 3 Starbucks Metrics Matter More|last=Hall|first=Jason|date=April 20, 2020|website=The Motley Fool|language=en|access-date=April 20, 2020}}{{Cite web|url=https://www.bloomberg.com/news/articles/2020-03-23/coffee-growers-on-alert-for-labor-disruptions-amid-lockdowns|title=Starbucks Closures Can't Stop Coffee's Massive Rally, Here's Why|last=Perez|first=Marvin|date=March 23, 2019|website=www.bloomberg.com|access-date=April 20, 2020}}

Asia

=China=

File:Luckin Coffee at Hubin Intime in77C (20190807162757).jpg has been China's largest coffee chain by store count.]]

From the early 1990s to the late 2010s, Starbucks was the largest coffeehouse in China.{{Cite web|url=https://www.fastcompany.com/90457552/luckin-coffee-most-innovative-companies-2020|title=How Luckin Coffee surpassed Starbucks as China's largest coffee chain…in just over two years|last=Lidsky|first=David|date=March 10, 2020|website=Fast Company|language=en-US|access-date=April 5, 2020}}{{Cite web|url=https://www.npr.org/sections/goatsandsoda/2019/05/17/723193259/what-does-chinas-luckin-coffee-have-that-starbucks-doesnt|title=China's Luckin Coffee Tries To Conquer A Nation Of Tea Drinkers|website=NPR.org|language=en|access-date=2020-04-12}} However, since 2017, competition over the Chinese coffee market has intensified between Starbucks and Luckin Coffee.{{Cite web|url=https://news.pedaily.cn/202001/450277.shtml|title=瑞幸咖啡进军无人零售,直营门店4507家超星巴克|date=8 January 2020|website=投资界}}

In August 2018, Luckin signed a distribution deal with e-commerce group Alibaba to increase their online retail presence in China.{{Cite web|url=https://www.axios.com/starbucks-alibaba-china-coffee-delivery-luckin-27f0dba6-30b2-47aa-8a81-01e0430809a2.html|title=Starbucks stares down a buzzy, homegrown Chinese competitor|last=Pandey|first=Erica|date=August 5, 2018|website=Axios|language=en|access-date=April 20, 2020}} The 2018 trade war between the U.S. and China, with the two companies serving as their respective proxies, also led to a resurgence of Luckin Coffee in China.{{Cite web|url=https://qz.com/1833297/fans-rally-to-aid-chinas-luckin-coffee-after-fraud-scandal|title=Luckin Coffee, China's Starbucks rival, is getting a nationalist boost amid a huge fraud scandal|last=Li|first=Jane|date=April 18, 2020|website=Quartz|language=en|access-date=April 18, 2020}}

In January 2020, Luckin Coffee had more stores than Starbucks in China,{{Cite news|last=McDonnell|first=Stephen|url=https://www.bbc.com/news/business-52146498|title=China's Luckin Coffee slumps on 'fake' data news|date=3 April 2020|work=BBC News|access-date=10 April 2020|language=en-GB}} with Luckin having 4,500 stores compared to Starbucks' 4,200.{{Cite web|url=https://qz.com/1833297/fans-rally-to-aid-chinas-luckin-coffee-after-fraud-scandal|title=Luckin Coffee, China's Starbucks rival, is getting a nationalist boost amid a huge fraud scandal|last=Li|first=Jane|date=April 5, 2020|website=Quartz|language=en|access-date=April 5, 2020}} However, the Chinese firm's entry into the U.S. capital markets faltered in early April 2020 after reports surfaced of fraudulent accounting and inflating market share projections.{{Cite web|url=https://www.cnbc.com/2020/04/02/luckin-coffee-stock-plummets-after-investigation-finds-coo-fabricated-sales.html|title=Shares of China's Luckin Coffee plummet 80% after investigation finds COO fabricated sales|last=Lucas|first=Amelia|date=April 2, 2020|website=CNBC|language=en|access-date=April 2, 2020}}{{Cite web|url=https://www.forbes.com/sites/ywang/2020/04/10/china-stocks-face-increased-scrutiny-after-tal-education-and-luckin-coffee-reveal-inflated-sales|title=China Stocks Face Increased Scrutiny After TAL Education And Luckin Coffee Reveal Inflated Sales|last=Wang|first=Yue|date=Apr 10, 2020|website=Forbes|language=en|access-date=Apr 10, 2020}} Luckin Coffee's stock was halted on the U.S. stock market after a corporate fraud investigation was initiated by U.S. and Chinese authorities.{{Cite web|url=https://finance.yahoo.com/news/starbucks-china-could-soon-listed-191137019.html|title=Starbucks of China could soon be de-listed over fraud allegations|last=Dogan|first=Inan|date=April 13, 2020|website=finance.yahoo.com|language=en-US|access-date=April 13, 2020}} Chinese consumers were boosting Luckin Coffee's market share as a rejection of American-led companies, specifically Starbucks. The Chinese government cautioned domestic investors from doing this soon-after, writing: "Luckin's actions harm the reputation of Chinese companies overseas." Fearing a possible bankruptcy, Luckin Coffee customers flooded their online app with orders redeeming free drink vouchers leading to a temporary rise in market share.{{Cite web|url=https://www.fastcompany.com/90487535/embattled-luckin-coffee-sees-wild-surge-as-customers-scramble-to-cash-in-on-free-drink-vouchers|title=Embattled Luckin Coffee sees wild surge as customers scramble to cash in on free drink vouchers|last=Lin|first=Connie|date=April 12, 2020|website=Fast Company|language=en-US|access-date=April 12, 2020}}

= Taiwan =

File:Keelung Qidu Store, Louisa Coffee 20200414.jpg is Taiwan's largest coffee chain by number of locations.]]

Several popular Taiwanese coffee chains are in Taiwan, including 85C Bakery Cafe and Louisa Coffee. In December 2019, Louisa Coffee became the chain with the most locations in Taiwan.{{cite news|url=https://udn.com/news/story/7241/4244821|title=咖啡店龍頭換人做!路易莎上位 星巴克年賺110億稱霸|trans-title=A new king in the coffee chain world! Louisa surpasses Starbucks|date=December 24, 2019|access-date=May 30, 2020|work=United Daily News|author1=何秀玲|author2=黃文奇}}

Europe

File:Four chains in a row.jpg in London, England]]

The coffee wars in North America have promoted a rise in mergers and acquisitions in the European coffee market to better compete in coffee wars.{{Cite news|url=https://www.economist.com/business/2018/10/11/competition-is-hotting-up-in-the-coffee-industry|title=Competition is hotting up in the coffee industry|date=October 11, 2018|newspaper=The Economist|access-date=April 10, 2020|issn=0013-0613}} In October 2018, the Italian coffee proprietor Illy merged with the German JAB Holding Company to reconfigure its market share. The two companies announced that they will be producing espresso pods, to compete with Nestlé's Nespresso brand.{{Cite news|last=Landini|first=Francesca|url=https://www.reuters.com/article/illycaffe-jab-idUSL8N1WO25J|title=UPDATE 3-Illycaffe and JAB team up on Nespresso-compatible coffee pods|date=October 8, 2018|work=Reuters|access-date=April 10, 2020|language=en}} European, and particularly Italian, brands struggle to compete in U.S.-based coffee wars due to their cultural rejection of third-wave coffee culture.{{Cite web|url=https://www.scmp.com/magazines/style/news-trends/article/3075791/coffee-wars-italians-adore-espresso-what-about-matcha|title=Are frappuccinos and pumpkin spice lattes really coffee at all?|last=Marchetti|first=Silvia|date=March 19, 2020|website=South China Morning Post|language=en|access-date=April 5, 2020}} However, their Italian identity is "a big advantage over the multinationals" with respect to espresso. The 2018 entrance of Starbucks and Nestlé into the Italian coffee market had Lavazza and Illy increase their merger and acquisition (M&A) activity. In October 2018 Lavazza acquired Mars Inc.’s coffee business for $650 million while Illy signed a distribution deal with JAB. The Wall Street Journal reported that the European coffee market was worth $83 billion in 2018, estimating a 16 percent increase in 2019. The vice chairman of Lavazza, Giuseppe Lavazza, conceded in 2018 that Starbucks was competitive in the Italian market.

North America

=Canada=

Several coffee chains operate in Canada, including Blenz Coffee, Coffee Time, Country Style, Second Cup, Starbucks, McDonald's Canada, Tim Hortons, and Timothy's World Coffee.

File:Tim Hortons Shelburne.jpg store in Shelburne, Ontario. Tim Hortons is Canada's largest coffee chain by number of locations.]]

A "coffee war" began in Canada in the late-2000s after Starbucks made an effort to attract the Canadian breakfast market, markets traditionally dominated by Tim Hortons and McDonald's.{{cite web|url=https://www.fool.ca/2018/08/01/the-coffee-wars-are-over-heres-where-we-find-growth/|website=www.fool.ca|publisher=The Motley Fool Canada, ULC.|last=Goldsman|first=Ryan|title=The Coffee Wars Are Over: Here's Where We Find Growth!|date=August 1, 2018|access-date=August 3, 2020}} During the 2010s, coffee chains offered several specials and promotions in an attempt to attract market shares from the competition. McDonald's began to compete directly with Tim Hortons' annual "Roll Up the Rim" contest, by introducing a semi-annual promotion of a free small coffee in 2010.{{cite web|url=https://www.thestar.com/business/2010/03/01/mcds_goes_free_to_counter_tim_hortons.html|title=McD's goes free to counter Tim Hortons|date=March 1, 2010|access-date=August 3, 2020|last=Taylor|first=Lesley Ciarula|publisher=Torstar Corporation|work=The Toronto Star}} In a 2011 report released by the NPD Group, the 3,295 Tim Hortons locations accounted for 26 percent of all restaurant traffic in Canada, whereas McDonald's' 1,400 locations accounted for 10 percent, and Starbucks locations accounted for 1.3 percent.{{cite web|url=https://globalnews.ca/news/220692/who-is-winning-the-great-canadian-coffee-war/|title=Who is winning the great Canadian coffee war?|last=Tucker|first=Erika|date=March 8, 2012|access-date=August 3, 2020|publisher=Corus Entertainment Inc.|work=Global News}} In 2011, Tim Hortons accounted for 76 percent of the baked food and coffee market in the country; with eight out of 10 cups of coffee sold at "quick-service restaurants" in Canada were from Tim Hortons. Tim Hortons sold over 2.1 billion cups of coffee that year; Conversely, McDonald's sold 200 million cups of coffee that year.

As of December 31, 2016, Tim Hortons remained the largest coffee chain by number of locations available in Canada, with 4,613 stores.{{cite web|url=https://www.theglobeandmail.com/report-on-business/by-the-numbers-tim-hortons-franchisees-and-ontarios-minimum-wage-hike/article37553411/|title=By the numbers: Tim Hortons franchisees and Ontario's minimum wage hike|last=Sagan|first=Aleksandra|date=January 10, 2018|work=The Globe and Mail|publisher=The Globe and Mail Inc.|access-date=September 10, 2019}} McDonald's, and Starbucks both operate over 1,400 stores in Canada.{{cite web|url=https://www.starbucks.ca/careers/CanadianStory|title=Our Canadian Story|year=2019|publisher=Starbucks|access-date=September 10, 2019}}{{cite web|url=https://www.newswire.ca/news-releases/university-of-the-fraser-valley-and-mcdonald-s-team-up-to-offer-credit-toward-university-credentials-862810594.html|title=University of the Fraser Valley and McDonald's team up to offer credit toward university credentials|date=August 27, 2019|work=Cision|publisher=CNW Group Ltd.|access-date=September 10, 2019}} In 2014, Canada has more Starbucks per capita than any other country in the world, with 39.54 Starbucks stores for every million residents in Canada.{{cite web|url=https://www.huffingtonpost.ca/2014/05/27/starbucks-canada-leads-world_n_5399685.html|title=Canada Leads World In Starbucks Locations|date=May 27, 2014|work=Huffington Post|access-date=September 10, 2019}} In an effort to gain further market share in the Canadian coffee market, McDonald's began opening standalone McCafés in Canada in 2015.{{cite web|url=https://toronto.citynews.ca/2015/12/09/mcdonalds-opens-first-stand-alone-mccafe-at-torontos-union-station/|title=McDonald's opens first stand-alone McCafe at Toronto's Union Station|last=Henderson|first=Peter|date=December 9, 2015|work=CityNews|publisher=Rogers Media|access-date=September 10, 2019}} McDonald's tripled its sales of brewed coffee in Canada from the 1970s to 2018, doubling its market share to 13 percent.{{Cite web|url=https://business.financialpost.com/news/retail-marketing/mcdonalds-extends-its-cafe-chain-rollout-as-it-battles-tim-hortons-and-starbucks|title=McDonald's extends its cafe chain rollout as it battles Tim Hortons and Starbucks {{!}} Financial Post|last=Shaw|first=Holly|date=June 22, 2018|website=Financial Post|language=en-CA|access-date=April 20, 2020}} However, the same period also saw Dunkin' Donuts withdraw from the Canadian market, with the company closing its last three Canadian locations in September 2018.{{cite web|url=https://globalnews.ca/news/4434666/dunkin-donuts-done-in-montreal/|title=Dunkin' Donuts done in Montreal|date=6 October 2018|accessdate=25 December 2020|work=Global News|publisher=Corus Entertainment|last=Spencer|first=Dan}} Dunkin Donuts' decline in Canada has largely been attributed to its direct competition with Tim Hortons.{{cite book|title=The Donut: A Canadian History|publisher=University of Toronto Press|isbn=9780802095459|year=2008|last=Penfold|first=Steven|page=135}}

In addition to coffee, several of these fast food retailers, including Country Style, McDonald's, Starbucks, and Tim Hortons also compete for the country's fast food breakfast market, referred to as the "breakfast wars".{{cite web|url=https://nationalpost.com/pmn/news-pmn/canada-news-pmn/mcdonalds-canada-starts-selling-bagels-after-ontario-pilot-project|title=McDonald's serves up bagels amid breakfast war and Tim Hortons franchisee strife|last=Deschamps|first=Tara|date=May 10, 2018|work=The National Post|publisher=Postmedia Network Inc.|access-date=September 10, 2019}}

=United States=

According to The Economist, the largest coffee war of the late 2000s has been between Starbucks and McDonald's in the United States. This dynamic between the two coffeehouses was shared by the Financial Times.{{Cite web|url=https://www.ft.com/content/74dc79f4-bd2c-11dc-b7e6-0000779fd2ac|title=US coffee wars|date=January 7, 2007|website=Financial Times|access-date=April 10, 2020}} During the 2008 financial crisis, Starbucks' market share tapered after consumer spending dropped. McDonald's launched a marketing blitz to capitalize on this from 2008 to 2009.{{Cite web|url=https://www.newsweek.com/starbucks-vs-mcdonalds-87195|title=Starbucks vs. McDonald's|last=Ordoñez|first=Jennifer|date=January 10, 2008|website=Newsweek|language=en|access-date=April 4, 2020}} In December 2008, McDonald's erected a billboard that read "four bucks is dumb" a play on words for "Starbucks is dumb" for selling coffee at higher price points than McDonald's.{{Cite web|url=https://www.chicagotribune.com/news/ct-xpm-2008-12-11-0812110258-story.html|title=Starbucks takes high road in coffee wars|last=Services|first=New York Times News|date=December 11, 2008|website=chicagotribune.com|language=en-US|access-date=April 4, 2020}} Another billboard read "large is the new grande", a jab at the social and cultural perceptions of Starbucks.{{Cite news|last=Adamy|first=Janet|url=https://www.wsj.com/articles/SB119967000012871311|title=McDonald's Takes On A Weakened Starbucks|date=January 7, 2008|work=Wall Street Journal|access-date=April 4, 2020|language=en-US|issn=0099-9660}} However Starbucks chief executive Howard Schultz, a major proponent of coffee wars, voiced his concern about market saturation and vocally opposed the comparison between the McCafé and his firm's products.{{Cite news|last=Jargon|first=Julie|url=https://www.wsj.com/articles/SB10001424052748704076804576180313111969984|title=Coffee Talk: Starbucks Chief on Prices, McDonald's Rivalry|date=November 7, 2011|work=Wall Street Journal|access-date=April 4, 2020|language=en-US|issn=0099-9660}} "We are up for the defense and we are going to get on the offense," Schultz told investors in late-2008. John Moore, the firm's marketing head, denounced McDonald's as "selling hot, brown liquid masquerading as coffee" in 2003, in reference to recent market gains. In line with this the spread of instant coffee has also intensified competition in the packed coffee markets, particularly at lower price points.{{Cite web|url=https://abcnews.go.com/GMA/transcript-starbucks-ceo-instant-coffee-wars/story?id=8699834|title=Starbucks CEO on Instant Coffee Wars|last=Golodryga|first=Bianna|date=September 28, 2009|website=ABC News|language=en|access-date=April 4, 2020}} In 2009, McDonald's was seen to formally "kick off the coffee war" with Starbucks, particularly, by offering specialty espresso drinks.{{Cite news|last=Cowan|first=Julie|url=https://www.wsj.com/articles/SB10001424053111904233404576462171733550948|title=Dunkin' to Fuel Coffee Wars|date=July 27, 2011|work=Wall Street Journal|access-date=April 20, 2020|language=en-US|issn=0099-9660}} However, coffee accounted for 6 percent of domestic sales for McDonald's during this time. The Wall Street Journal reported in 2011 that the closer price points were for coffee the more competitive coffeehouses were with each other, in spite of different demographic markets.

File:0047jfSM City Baliuag food shops storesfvf 18.jpg coffee, 2017]]

The U.S. coffee market has since the early 2010s been primarily contested by its two largest players, Starbucks and Dunkin', which make up most of the country's commercial coffee shops.{{Cite web|url=https://www.cnbc.com/2018/02/09/dunkin-ceo-has-a-plan-to-win-the-coffee-wars.html|title=Dunkin' CEO has a plan to win the coffee wars in cafes and at the grocery store|last=Rogers|first=Kate|date=November 9, 2018|website=CNBC|language=en|access-date=April 10, 2020}} In 2014 The Guardian reported that "There is a war going on in America, and the battleground is coffee."{{Cite web|url=http://www.theguardian.com/lifeandstyle/2014/dec/12/starbucks-faces-growing-rivals-as-coffee-wars-reach-boiling-point|title=Starbucks faces growing rivals as coffee wars reach boiling point|last=Wolff|first=Nicky|date=December 12, 2014|website=the Guardian|language=en|access-date=April 10, 2020}} In July 2011 Dunkin' Donuts went public on the U.S. stock market, raising $427.5 million to "heat up the fast-food java battle." In 2011 Dunkin' Donuts controlled more than half of the New England coffee market. Around 60 percent of the company's domestic sales were attributable to coffee and beverages. In 2016, Dunkin' Donuts revamped their iced coffee offering, a departure from their portfolio of warm drip coffee and basic espresso-based drinks.{{Cite web|url=https://www.businessinsider.com/dunkin-donuts-launches-cold-brew-coffee-2016-6|title=Dunkin' Donuts has a new weapon in the coffee wars against Starbucks|last=Taylor|first=Kate|date=June 21, 2016|website=Business Insider|access-date=April 20, 2020}} Two years later, in 2019, the donut company dropped "donuts" from its name in order to better compete in the beverage industry.{{Cite web|url=https://www.businessinsider.com/dunkin-donuts-changes-name-no-donuts-2018-9|title=Dunkin' Donuts is officially dropping the 'Donuts' from its name despite earlier backlash|last=Taylor|first=Kate|date=September 28, 2018|website=Business Insider|access-date=April 20, 2020}} In September 2019, Dunkin' committed $100 million to position itself against Starbucks and McDonald's, calling the former coffeeshop its "arch enemy".{{Cite web|url=https://www.youtube.com/watch?v=F9ExKR3sUng|title=Why Dunkin' Is Taking On Starbucks And Betting On Coffee|last=Hoffman|first=David|date=September 19, 2019|website=CNBC|access-date=April 20, 2020}} By June, both companies registered record, yet comparable stock market growth, Dunkin' rising by 24 percent, Starbucks by 29 percent.{{Cite web|url=https://fortune.com/2019/06/25/stocks-coffee-starbucks-dunkin/|title=Why Coffee Stocks Like Starbucks and Dunkin' Are Suddenly Piping Hot|last=Sanders|first=Anne|date=June 25, 2019|website=Fortune|language=en|access-date=April 20, 2020}} A 2017 CNN analysis found that Dunkin' was "particularly aggressive in the coffee wars."{{Cite web|url=https://money.cnn.com/2017/03/23/investing/dunkin-brands-starbucks-coffee-trump/index.html|title=Coffee wars! Wall Street runs on Dunkin', not Starbucks|last=Monica|first=Paul|date=March 23, 2017|website=CNNMoney|access-date=April 20, 2020}} During that year's Starbucks annual meeting Schultz responded to Dunkin' market gains by telling shareholders to metaphorically bring the "sabers out." Tim Hortons, a Canadian chain which historically had only a limited presence in the U.S. (primarily in Western New York), made a major expansion into the U.S. in the early part of the 21st century, culminating in its corporate merger with established U.S. fast food chain Burger King in 2014.{{Cite web|url=https://www.forbes.com/sites/greatspeculations/2014/08/29/burger-king-tim-hortons-cross-border-merger-much-more-than-tax-inversion/|title=Burger King-Tim Hortons Cross-Border Merger Much More Than Tax Inversion|last=Team|first=Trefis|date=August 14, 2014|website=Forbes|language=en|access-date=April 5, 2020}}

In 2013, The Motley Fool speculated that the spread of Starbucks' gift cards and national loyalty program was a primary driver in coffee-driven market gains.{{Cite web|url=https://www.fool.com/investing/general/2013/12/21/starbucks-is-winning-the-coffee-war-with-its-gift.aspx|title=Starbucks Is Winning The Coffee War With Its Gift Cards|last=Yagalla|first=Mark|date=December 21, 2013|website=The Motley Fool|language=en|access-date=April 20, 2020}} A year later, McDonald's conceded that Starbucks was "winning the coffee wars" by cornering the caffe latte market.{{Cite web|url=https://www.bloomberg.com/news/articles/2014-01-29/mcdonald-s-seeks-to-out-latte-starbucks-amid-coffee-wars|title=McDonald's Seeks to Out-Latte Starbucks in Coffee War|last=Patton|first=Laura|date=January 29, 2014|website=www.bloomberg.com|access-date=April 20, 2020}} Competing firms have retooled their market expansion by spinning off divisions to finance store openings. In 2018 Starbucks sold its packaged coffee business to Nestlé in order to free up $7.2 billion for their stores.{{Cite web|url=https://investorplace.com/2020/04/sbux-stock-luckin-coffee-bleak-future/|title=Starbucks Stock Catches a Luckin Break, But Its Future Is Bleak|last=Blankenhorn|first=Dana|date=April 4, 2020|website=InvestorPlace|language=en-US|access-date=April 4, 2020}} In an effort to undercut its competition, Starbucks released its signature Pumpkin Spice Latte in August 2019 – instead of its typical Autumn release.{{Cite web|url=https://finance.yahoo.com/news/starbucks-release-pumpkin-spice-lattes-145532175.html|title=Starbucks to release Pumpkin Spice Lattes early in coffee wars|last=Tesler|first=Rachael|date=August 13, 2019|website=Yahoo Finance|language=en-US|access-date=April 20, 2020}} In March 2020, Panera Bread launched a coffee subscription service to compete directly with Starbucks' national loyalty program.{{Cite web|url=https://www.forbes.com/sites/aliciakelso/2020/02/27/panera-launches-899-unlimited-monthly-coffee-subscription-program/|title=Panera Launches $8.99 Unlimited Monthly Coffee Subscription Program|last=Kelso|first=Alicia|date=February 27, 2020|website=Forbes|language=en|access-date=April 10, 2020}} The COVID-19 pandemic led to severe backsliding in market share for the largest coffeeshops, with smaller cafés closing permanently due to lack of demand.{{Cite web|url=https://www.cnn.com/2020/03/21/business/starbucks-closing-covid-19/index.html|title=Starbucks is closing its cafes due to coronavirus, with some exceptions|last=Liao|first=Shannon|date=March 21, 2020|website=CNN|access-date=April 21, 2020}} Most of the major players initiated distribution deals with delivery platforms during the pandemic to sustain growth: Uber Eats (Starbucks),{{Cite web|url=https://www.forbes.com/sites/christopherwalton/2020/04/03/3-ways-starbucks-will-emerge-from-covid-19-stronger-than-before/|title=3 Ways Starbucks Will Emerge From COVID-19 Stronger Than Before|last=Walton|first=Chris|date=April 3, 2020|website=Forbes|language=en|access-date=April 20, 2020}} GrubHub (Dunkin'),{{Cite web|url=https://www.thestreet.com/investing/dunkin-shares-double-upgraded-at-credit-suisse|title=Dunkin' Double Upgraded at Credit Suisse on Resilience During Pandemic|last=Voorhis|first=Scott Van|date=April 13, 2020|website=TheStreet|language=en-us|access-date=April 20, 2020}} and DoorDash (McDonald's).{{Cite web|url=https://www.businessinsider.com/doordash-virtually-recreates-restaurant-experience-amid-coronavirus-2020-4|title=DoorDash is recreating the restaurant experience with virtual backgrounds and dining room playlists from popular chains like The Cheesecake Factory and Cracker Barrel|last=Biron|first=Bethany|date=April 21, 2020|website=Business Insider|access-date=April 21, 2020}}

In 2023 McDonald's opened a trial of a few CosMc's cafes, selling afternoon snacks, drinks and coffee. This was seen as an attempt by McDonald's to reposition themselves in the United States coffee market.{{cite news |title=McDonald's unveils US CosMc's trial and global expansion |url=https://www.bbc.co.uk/news/business-67644926 |access-date=7 December 2023 |work=BBC News |date=7 December 2023 |archive-date=December 7, 2023 |archive-url=https://web.archive.org/web/20231207085657/https://www.bbc.co.uk/news/business-67644926 |url-status=live }}

Espresso machine market

Along with the competition between coffeehouses, the manufacturers of espresso machines have also competed to enlarge their respective shares.{{Cite web|url=https://knowledge.wharton.upenn.edu/article/coffee-wars-part-ii-can-other-companies-unseat-nespresso/|title=Coffee Wars Part II: Can Other Companies Unseat Nespresso?|last1=Management|first1=Strategic|last2=Europe|date=June 3, 2012|website=Knowledge@Wharton|language=en|access-date=2020-04-20}} Typically coming in three styles, manual (pulls), automatic (pulls and serves), and super-automatic (grinds, pulls, and serves), the advent of espresso pods, have lowered the market's barrier to entry.{{Cite news|last=Ball|first=Deborah|url=https://www.wsj.com/articles/SB10001424052748704009804575308224213314824|title=Nestlé Sues Sara Lee in Coffee War|date=June 6, 2010|work=Wall Street Journal|access-date=April 4, 2020|language=en-US|issn=0099-9660}} In 2010, Nespresso launched a home-brew method of pulling espresso shots by inventing a compact single-use coffee container.{{Cite news|last=Alderman|first=Liz|url=https://www.nytimes.com/2010/08/21/business/global/21coffee.html|title=Nespresso and Rivals Vie for Dominance in Coffee War|date=November 20, 2010|work=The New York Times|access-date=April 4, 2020|language=en-US|issn=0362-4331}} Typically contrasted with the more traditional ground coffee served by most major coffeeshops, the use of espresso pods have proliferated. In March 2014 Nespresso's patent expired,{{Cite web|url=https://www.macleans.ca/society/life/single-serve-coffee-wars-heat-up/|title=Patents expire and the single-serve coffee war heats up|last=Sorensen|first=Chris|date=March 11, 2014|website=www.macleans.ca|access-date=April 4, 2020}} allowing Keurig and Green Mountain Coffee to market their own brands. In 2018, Keurig Green Mountain merged with Dr Pepper to create Keurig Dr Pepper.{{Cite web|url=https://www.forbes.com/sites/maggiemcgrath/2018/01/29/coffee-meets-soda-keurig-and-dr-pepper-snapple-merge-to-create-beverage-behemoth/|title=Coffee Meets Soda: Keurig And Dr Pepper Snapple Merge To Create Beverage Behemoth|last=McGrath|first=Maggie|date=January 29, 2018|website=Forbes|language=en|access-date=April 4, 2020}} In March 2016, Starbucks announced a partnership with Keurig to distribute Starbucks-branded pods in their brewers officially entering the market.{{Cite news|last=Beurteling|first=Lisa|url=https://www.reuters.com/article/us-starbucks-meeting-deal-idUSKCN0WP2A8|title=Starbucks announces Nespresso pod deal, new loyalty perks|date=March 23, 2016|work=Reuters|access-date=April 2, 2020|language=en}} In April 2019 Starbucks launched a large suite of espresso pods, featuring all of their branded-espresso, with Nestlé.{{Cite web|url=https://www.thrillist.com/news/nation/starbucks-launches-nespresso-pods|title=Making Starbucks Espresso Drinks at Home Is About to Be Way Easier|last=Hitt|first=Caitlyn|date=April 23, 2019|website=Thrillist|access-date=April 2, 2020}} This linked the world largest coffeehouse with the largest pod-manufacturer. Since then, many companies (including Italian manufactures Lavazza and Illy) have launched their own brands.{{Cite web|url=https://www.businessinsider.com/best-coffee-and-espresso-pod|title=The best coffee and espresso pods you can buy|last=Burke|first=Owen|date=May 10, 2019|website=Business Insider|access-date=April 10, 2020}}{{Cite web|url=http://www.goodhousekeeping.co.uk/product-reviews/electricals/a656779/which-is-the-best-type-of-coffee-machine/|title=How to pick a coffee machine|last=Anderson|first=Lydia|date=April 17, 2020|website=Good Housekeeping|language=en-GB|access-date=April 17, 2020}}

See also

References