Which Coffee Chain Gets Top Marks in Customer Satisfaction?

Gone are the days when you could walk into a diner, get your $0.50 cup of "coffee," and calmly read the paper while some waitress asked, "Anything else?" every 10 minutes. In today's coffee marketplace, $5 coffee comes and goes like the sun on a cloudy day, and we demand quick service to get us running out the door. This month's customer satisfaction scores from the American Customer Satisfaction Index included limited-service restaurants Starbucks (NASDAQ: SBUX  ) , Dunkin' Brands' (NASDAQ: DNKN  ) Dunkin Donuts, and McDonald's (NYSE: MCD  ) -- no one came out looking like the clear winner.

The top two spots
In the whole limited-service division, Subway comes in at the top spot with a score of 83. The overall average for the sector was 80, and both Dunkin' and Starbucks hit that average. Dunkin' won out in cost -- which was no real surprise -- while Starbucks won the quality fight. The move to 80 was good news for Starbucks, which had fallen behind in 2012, when it dropped down to 76 -- four points below the sector average.

Dunkin' had a smaller move, rising one point over last year's position. In 2012, price seems to have trumped quality, and in its first year of ranking, Dunkin' had the edge on Starbucks. Now Starbucks has taken its cost issues to heart, and apparently made a move to improve the perception of its quality to make up for that extra cost. Regardless of which brand you pull for, both are better off than...

McDonald's comes in dead last
The burger clown didn't beat out any of its main competitors and fell in overall last place of named companies this year. In fact, looking back at rankings since 1994, no one has ever been ranked lower than McDonald's.

In terms of future growth, that's a bad place to be. As the company's brand continues to erode, it's going to lose market share to competitors like Dunkin' and Starbucks -- not to mention Burger King and Wendy's. That said, however, McDonald's also did better than it's ever done, scoring a 73 this year. As the report points out, "A decade ago, McDonald's was stuck in the low 60s." 

McDonald's problem is that it's still lagging so far behind its peers. If it wants to make something more of its coffee offering, then it has to best Dunkin', at least. The two companies offer similar product ranges at similar prices, and if customers continue to favor Dunkin', the McCafe boat is simply going to sink.

For now, Starbucks and Dunkin' are the clear winners, and happy customers make happy investors. Keep an eye on McDonald's, though, as the chain has to get the idea at some point. Unfortunately, that some point isn't now.

McDonald's turned in a dismal year for investors in 2012, underperforming the broader market by 25%. Looking ahead, can the Golden Arches reclaim its throne atop the restaurant industry, or will this unsettling trend continue? Our top analyst weighs in on McDonald's future in a recent premium report on the company. Click here now to find out whether a buying opportunity has emerged for this global juggernaut.


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  • Report this Comment On June 20, 2013, at 12:07 PM, Harabingatz wrote:

    Give me Tim Horton's anytime. "I'd like a large double-double, please!"

  • Report this Comment On June 20, 2013, at 12:57 PM, peetsfan wrote:

    My coffee place isn't listed, but then I guess it's available mostly in California. But Peet's has them all beat. The best coffee beans, the best brewed coffee, the best latte, etc. Also a huge assortment of tea. And maybe there's a reason for that, before Starbucks became a mega corporation, Mr. Peet... is the man who founded the original company up in Seattle, sold out to the "big guys" and came back to California, to open Peets. I'm telling ya, go to Peets once, and you'll forget the other guys. And by the way, the service is EXCELLENT.

  • Report this Comment On June 20, 2013, at 1:03 PM, TheDanRazzaia wrote:

    Close, but not quite. Mr. Peet never left the Bay area. The three guys who started Starbucks were mentored, supplied, and given blessing by Mr. Peet. When Alfred retired in the early 80's, these guys bought Peet's Coffee & Tea from him & (for a while) Both Peet's & Starbucks were run out of the Bay area. They later sold their SB interests to Howard Schultz & the rest is history.

    Also, thanks for the compliment. I work for Peet's myself & we really try to give the most hospitable experience we can. As time goes by, we should see less & less of the "snobby barista" movement that was popular for much of the past 2 decades.

  • Report this Comment On June 20, 2013, at 1:32 PM, DebtFreeDave0 wrote:

    "Starbucks and Dunkin' are the clear winners"

    No they aren't. Looking at that survey, the top three in the rankings for "limited-service restaurants" category are 1) Subway (privately-owned) 2) Little Caesars (privately-owned) and 3) "All Others."

    According to the survey's fine-print, "The "All Others" score for an industry represents the remainder of the total industry market share, less the market shares of the measured companies. This benchmark is an aggregate of a representative number of customer interviews from each of potentially hundreds of smaller companies within the industry."

    This means that according to this survey, you will get the best service at Subway, Little Caesars, or the small businesses that aren't big enough to be included in this survey. This tells me that all of the big publicly traded coffee-chains, including Starbucks, Dunkin' Donuts, KFC, Wendy's, Burger King, Taco Bell, and McDonald's, are all losing the customer service competition to the local independently-owned coffee shop down the street (like Peet's as another commenter mentioned).

  • Report this Comment On June 20, 2013, at 1:43 PM, DebtFreeDave0 wrote:

    According to http://www.thedailymeal.com/americas-best-coffee-shops no publicly-traded company makes the list among the top 33 coffee shops in the country. Here in my hometown of Seattle, home of Starbucks, Stumptown Coffee (with locations in Portland, Seattle, and New York) is the best in town.

  • Report this Comment On June 24, 2013, at 8:41 AM, Alex1453 wrote:

    Why isn't Tim Horton's on this list as well? (NYSE:THI)

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