Subway to test Seattle's Best coffee

MILFORD Conn. Adding more heat to the coffee wars, the Subway sandwich chain confirmed Thursday it would begin testing Starbucks-owned Seattle’s Best Coffee at 1,900 locations starting in January.

The test stores will offer brewed Seattle’s Best Blend; Henry’s Blend; or 6th Avenue Bistro Blend in 12-ounce and 16-ounce sizes, Starbucks officials said. Subway officials did not offer details on the effort. The test is scheduled to run for six months in the United States, though specific markets have not been named, Starbucks said.

The potential partnership with Subway would give Starbucks Corp. a chance to win back quick-service consumers that may have made the switch to McDonald’s coffee because of its lower price tag. It would also give Starbucks a chance to compete head to head, or location to location, with McDonald’s new espresso-based drinks, as both Subway and McDonald’s boast tens of thousands of units each.

McDonald's has been rolling out its higher-end beverages in an attempt to undercut Starbucks’ market share, and chain officials have said they expect an incremental $1 billion in sales when all U.S. stores sell the upgraded coffee and other drinks next year.

McDonald’s also has utilized marketing efforts that attack Starbucks’ reputation as high-brow brew. In the Seattle area, where Starbucks is based, McDonald’s franchisees reportedly have erected billboards with slogans such as “four bucks is dumb,” referring to the higher price of Starbucks' coffees, and “large is the new grande,” making fun of the coffeehouse chain’s Italian menu lingo. There also have been online efforts, like www.unsnobbycoffee.com [2].

Starbucks officials, however, have refused to engage in such attacks, they said, arguing that their customers are loyal because Starbucks offers a coffee “experience” that cannot be found at McDonald’s.

Starbucks’ secondary Seattle’s Best brand is available in 550 namesake cafes across the country, as well as 6,000 foodservice locations, including hotels, college campuses, airlines and cruise lines.