Dunkin’ Donuts joins Starbucks in pursuit of lunch money

Dunkin’ Brands Group Inc. and Starbucks Corp. want a bigger chunk of your lunch money. Dunkin’ Donuts is introducing a new $3.99 grilled-chicken flatbread today, following Starbucks’s move last month to test seven new hot lunch sandwiches in some cafes. More

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Dunkin’ Donuts joins Starbucks in pursuit of lunch money

BLOOMBERG NEWS PHOTO/CRAIG WARGA
DUNKIN' DONUTS is looking to expand its customer base beyond the traditional breakfast market by adding more adventurous sandwiches to its lineup, starting Monday with a new grilled-chicken flatbread.
Posted 6/2/14

CHICAGO - Dunkin’ Brands Group Inc. and Starbucks Corp. want a bigger chunk of your lunch money.

Dunkin’ Donuts is introducing a new $3.99 grilled-chicken flatbread Monday, following Starbucks’s move last month to test seven new hot lunch sandwiches in some cafes. It’s part of an effort to boost afternoon sales and entice the lunch crowd after the morning java business subsides.

“The biggest challenge is generating awareness,” John Costello, global marketing and innovation president at Dunkin’ Brands, said in an interview. There’s customer demand for more food in the p.m. hours, he said, but Dunkin’ is best known for coffee and doughnuts.

Lunch is the latest battleground in an increasingly competitive industry. Chains like McDonald’s Corp. have attacked the coffee business, increasing pressure to fire back at traditional fast-food bastions. At the same time, coffee chains are challenging sitdown restaurants by revamping their decor and - in Starbucks’ case - offering alcohol and tapas.

At coffee and doughnut shops, about 65 percent of customer traffic happens in the morning, according to NPD Group Inc. Lunch and afternoon snack time is about a third of traffic, while dinner is just 2 percent, NPD data show.

Dunkin’ Donuts embarked on a more cafe-style store redesign last year, complete with earth-toned walls, jazz music and cozy booths, to encourage diners to hang out in the afternoon. In the past year, it’s also added nonbreakfast food items, such as a bacon-ranch breaded-chicken sandwich, and introduced a nationwide loyalty program.

Sandwich test

Starbucks also is gunning for the lunch customer. It began offering new sandwiches in 178 cafes in Phoenix and Richmond, Va., on May 6. The test includes a grilled-chicken sandwich, topped with bacon and swiss, for $5.95, a grilled cheese for $5.25, and a beef brisket and cheddar baguette for $6.95. The sandwiches are prepackaged and heated in stores, similar to the Seattle-based chain’s panini lineup. Starbucks plans to introduce new lunch sandwiches nationwide in fiscal 2015, which starts near the end of September.

“Starbucks stores across the U.S. will increasingly be seen as a destination for a quick, delicious and high-quality lunch,” Chief Operating Officer Troy Alstead said during a conference call in April.

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