Starbucks and McDonald’s Raise the Heat on the Coffee Wars

Moneybox
A blog about business and economics.
Aug. 20 2014 1:54 PM

Starbucks and McDonald’s Raise the Heat on the Coffee Wars

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Starbucks is going for caffeine-craving college students.

Courtesy of Starbucks

Competition for coffee drinkers is heating up as bean supplies dwindle and prices everywhere increase. Now two big players in the industry are testing new strategies to peddle their caffeinated wares.

Starbucks is focusing its efforts on some of the biggest caffeine-guzzlers of all: college students. The company plans to introduce coffee-carrying food trucks on three campuses this fall: Arizona State University, James Madison University, and Coastal Carolina University. (ASU has also partnered with Starbucks on a plan to bring affordable college education to the coffee giant's employees.) Starbucks has a surprisingly small presence in colleges at the moment, with only 300 of 11,500 stores on U.S. campuses, according to Businessweek.

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McDonald's, the other company to recently announce a new development in coffee strategy, has decided to start selling its McCafe brand as packaged coffee in U.S. grocery stores next year. No prices have been announced yet, but presumably they'll reflect the increases that just about every other major brand has announced this summer. But McDonald's will have the benefit of following those price hikes without having to formally announce one of its own.

Alison Griswold is a Slate staff writer covering business and economics.