"How many coffee shops in Boston?"

Hmmm...well, suppose there are 1 million people in Boston. Then... NOPE. Stop it. This series is nothing about strategy for any brain teaser. This is an analysis about two major coffeehouse chains, Starbucks vs Dunkin' Donuts, "corporate + license" vs pure franchise, in Boston area. I will walk you through their distribution and strategies of choosing a location (if consistent). This series is roughly separated by following parts.

• Part 0: Get the data prepared!
• Part 1: A glance at locations
• Part 2: Who are Dunkin's and Starbucks' favorite neighbors? - Empirical Bayes Analysis
• Part 3: What can we expect around a coffeehouse? - Network Visualization
• Summary

A glance at locations

In this post, it will give you a brief idea of the coffeehouse distribution in Boston area [1]. You can also find my code here. Enjoy!

Dunkin' wins in number, even within major battlefields

150:79! Dunkin' nearly doubles the number of Starbucks in Boston. It could be the result of different ownership types and target markets. However, even in major commercial areas [2], it is still easier to find a Dunkin'.

Dunkin' covers almost every area where a Starbucks shop locates. Suppose our tolerance of walking to a coffeehouse is only about 10 minutes. Each germ-like colored area in map represents the region with a coffeehouse covered. (Red is for Dunkin' and green is for Starbucks) Except the southwest Brookline area, Dunkin' totally wins Starbucks in the number of stores in Boston.

Red for Dunkin'/ Green for Starbucks

Dunkin', a coffeehouse next-door. Starbucks, another place for work

Compared with Starbucks' strong preference of commercial area, Dunkin's stores are also scattered evenly alongside some main streets in residential areas. That makes life easier to get something near home before you go to work.

Besides downtown area and bay area, airport is another battlefield. Think about it. How many times have you got breakfast from any of them when you were waiting for an early flight?

Left for Dunkin'/ Right for Starbucks

Next store?

If pick up a new location for Dunkin', South Brookline or Southwest Brookline might be good choices. There are not too many coffeehouses. Besides, Route 9 is a major east–west state highway in Massachusetts.

For Starbucks, Charlestown region might be good as well. It is one of fast developing places in Boston. Besides, Medical schools and luxury condos will bring Starbucks customers with needs and consuming capacity.

Next store?

Almost saturated

But as customers, do we need more Dunkin' or Starbucks in Boston? Hell, no. Only the region in purple circle is not covered by any of them. But remember, we are talking about service within walking distance. People still can drive. Thus the market is almost saturated if customers don't have a strong preference.

Almost saturated

Conclusion

The competition of Starbucks and Dunkin' in Boston is intense! The market is almost saturated, though there is still some space for new stores. While Starbucks consistently run stores in major commercial area, Dunkin' outperforms by the number of stores by the strategy of serving a more general customer base, especially in residential area.

What's next?

You will have a deeper understanding of what kind of neighborhood that Starbucks or Dunkin' prefer. A neighborhood will be described by the number of different types of merchants. Do they prefer to open a store with a car repair store in the neighborhood? Or do they love to open a store in the region where there are more pricey restaurants than cheap restaurants? Bayesian Analysis will be used to find which merchant is Starbucks favorite and whether there is a consistent preference for Dunkin's owners.

[1] Boston Region by Zip Code and Neighborhood - Mass.gov
[2] Major commercial regions include Beacon Hill, Chinatown, Tufts Medical, Faneuil Hall marketplace, north end, downtown crossing, financial district, Back Bay, Fenway, Kenmore, Seaport, West End and airport.