“The brand was very iconic and well done, but I believe the attempt to enter the beverage market was simply too tight with strong brands like Starbucks, Dunkin’, Dutch Bros (BROS), and even 7-Eleven making strides on all fronts,” Newman said.
Newman also said that with five locations the concept was clearly still just in the “testing” phase, but the chain will be able to use what it learned and incorporate it into the main brand.
“The CosMc’s brand may not be worth its own store, but the ‘mode’ that CosMc’s can capture would be worth wrapping within the McDonald’s offering,” Newman noted.
“Allowing CosMc’s to be the beverage arm of the McDonald’s experience could help elevate beverage perceptions because of the ‘niche’ to which it would be dedicated. The power here is leveraging sub-brands similar to the strategy Costco (COST), Trader Joe’s, and Target (TGT) have proven effective,” Newman said, adding that the experience may also help the concept gain more traction to then roll out smaller footprint storefronts like Dutch Bros and other brands have deployed.”
