The aroma of competition is brewing in the coffee industry as CosMc's, a new concept by McDonald's, takes its first steps into the market. With the inaugural CosMc's location already gracing Bolingbrook, Illinois, and plans for expansion in the thriving metro areas of Dallas-Fort Worth and San Antonio, Texas, the coffee landscape might be about to witness a significant transformation.

According to insights from William Blair analyst Sharon Zackfia, CosMc's is deemed unlikely to pose a substantial threat to Starbucks' established dominance [1]. However, understanding the nuances of each player's strategy is crucial for brands looking to expand their online presence and brand dominance.

Motivated by our curiosity, we embarked on a thorough investigation into the dynamic competition between CosMc's and the coffee giant, Starbucks. Our focus centered on understanding Starbucks' current presence across the US, aiming to gain insights into the magnitude of the challenge that CosMc's faces as it strives to ascend to the heights set by the established coffee powerhouse.

Starbucks: Beyond Coffee Cups

Our exploration takes us deep into Starbucks' distribution strategies, providing a comprehensive view into its physical and digital presence. We conducted research on Starbucks shops based on their food delivery presence as well as their geographical location at the end of 2023, in order to make a comparison between their physical and digital presence. The data unravels intriguing patterns in Starbucks' footprint across the United States. 

Insights on Starbucks physical presence across the US

- Diverse Market Saturation: The FSA dataset uncovers significant variations in the number of Starbucks outlets across different states. While California boasts a substantial presence with over 1300 outlets, Wyoming and Vermont have less than 10 stores each, signaling diverse market saturation and untapped growth opportunities.

- Top Performing States: Starbucks excels in California, Texas, and Florida, strategically saturating these populous and diverse states, particularly in urban areas. This widespread presence ensures accessibility and visibility, catering effectively to the diverse demographics of these states and building a broad customer base. The success is fueled by culturally resonant marketing strategies, turning Starbucks into more than just a coffee chain—it’s a cultural fixture [2]. This integration enhances brand loyalty and fosters a sense of community. These states provide valuable insights for expansion strategies. Analyzing urban and rural distribution unveils Starbucks' market strategy. Dashmote's geolocalization data, including contact information, offers a comprehensive view, aiding companies in tailoring strategies for suburban or rural markets.

- Market Penetration in the East: Starbucks has effectively established itself in eastern states like New York, Massachusetts, and Pennsylvania, capitalizing on urban and cultural centers. In New York, Starbucks has strategically located stores in bustling areas, catering to diverse demographics. The company's expansion in Massachusetts includes key locations in Boston and other urban hubs, targeting both residents and tourists. Additionally, Starbucks has successfully penetrated the market in Pennsylvania, where its coffee houses serve as popular meeting places.

- Potential Growth Areas: States with fewer Starbucks outlets, such as Montana, North Dakota, and Wyoming, are correlated with lower population densities. However the limited availability of Starbucks (digital) stores suggests untapped potential. Starbucks strategically allocates its resources based on market demand, population concentration, and economic factors. A thorough understanding of the unique dynamics in these regions, including demographics, competition, and cultural preferences, would provide insights into Starbucks' expansion decisions in these states, ensuring successful penetration. 

Starbucks: Coffee and more delivered to your home

Starbucks' digital frontier is equally compelling, with a significant number of digital storefronts (DSFs) across states. California leads with almost 1,800 DSFs, followed by Texas (nearly 900) and Illinois (about 500). The higher number of DSFs compared to physical stores is attributed to the fact that a single store can leverage multiple food delivery platforms, showcasing Starbucks' substantial adoption of digital channels. For this data, we focused on the biggest players in food delivery in the US, Doordash, Uber Eats and Grubhub. Regional disparities in DSFs present opportunities for Starbucks to enhance its digital reach. 

Insights on Starbucks digital presence across the US on FSA

- Correlation with Physical Stores: Variations in digital and physical presence highlight strategic opportunities. Some states with a high number of physical stores also exhibit a robust digital presence, while others show disparities, suggesting room for improvement.

- Population Density Impact: In assessing the correlation between digital and physical presence, certain states, such as California, Texas, and New York, demonstrate a synergy where a substantial number of physical stores align with a robust digital presence. Conversely, states like Kansas and Oklahoma stand out for their significantly higher digital presence compared to the number of physical stores. Additionally, a noteworthy observation is that states with higher digital presence often coincide with densely populated regions, highlighting the convenience and accessibility facilitated by food delivery platforms.

- Market Adaptation and Consumer Behavior: Balancing physical and digital presence provides insights into Starbucks' adaptation to evolving consumer behaviors. States where digital presence surpasses physical stores signal a shift in consumer preferences toward online ordering.

- Digital Competitive Landscape: Comparing Starbucks' digital presence with competitors on food delivery platforms unveils the competitive landscape in the digital space, aiding in refining digital marketing and delivery strategies.

Comparison: Physical vs Digital

As the digital realm becomes integral to a brand's identity, the importance of a store's virtual presence is underscored. In today's landscape, relying solely on physical stores or a single food delivery platform may limit reach and accessibility. A multi-platform digital strategy enables a store, whether a large chain or a smaller establishment, to cater to diverse consumer preferences and leverage the growing trend of online ordering and food delivery, ensuring a broader and more resilient market presence

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Dashmote assists enterprises in overcoming obstacles in the digital market space. As the foremost provider of big data and AI analytics solutions in the F&B sector, we enable informed strategic choices. Reach out to our team at to establish a robust online footprint.

If you find this article valuable, you may also be interested to check out more of our blog articles on franchises, such as The World of McFlurry and Beverage Menus on European Franchises

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