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Wednesday
Jul032013

On Branding, Markets, and the Value Proposition of Specialty Coffee

In a well written and thoughtful piece on the nature of branding and specialty coffee, the folks over at Colonna & Smalls in the UK touch on a couple of pertinent points regarding the notion of understanding how brand works and operates, as well as how it can be used to expand marketshare. Some money quotes: 

The task was to think of a brand, a well known one, but one which personally you have no interest in, and don’t get what all the fuss is about.  Then go away, immerse yourself in the world of that brand, empathise with those who do love it, try to understand their motivations and come back to explain why the brand is so popular and successful....

...

A customer being presented with speciality coffee at a till hasn’t been tasked with a university assignment, and the difficulty for them to understand the worth of a particular approach – of which they either were not aware or which is challenging to their brand allegiance to another coffee approach – is quite something to ask. Now of course, presenting speciality coffee as something new and innovative, a new brand if you like, means there is less perspective that needs evaluating, but it’s rarely a blank slate.

It’s not only the perspective of the customer that is useful to consider, but also, that of barista, speciality coffee people, and all other coffee brands and concepts. I think the easy labelling of speciality coffee as snobbish or elitist is partly to do with a possible inability to wear the shoes of those viewpoints and brands that aren’t the same as our own. This also applies within the speciality coffee field (wherever that line is drawn) in terms of understanding each other.....

...I think that often the expectation in coffee is for one brand to do the work of three or four brands. When the reality is a broader landscape that will have brands with very different appeal, different consumers and meanings. Coffee as an entity cannot have one brand as it means too many different things to too many people, not to mention there being a broad variety of the actual product itself, a multitude of brands reflects this.

The post spawned a conversation between myself, the delightful Alex Bernson and the C&S folks (short lived due to the 140 character nature of twitter) regarding the post. A few things came to mind: 

 

  1. As the post indicates, and as Alex elaborates on, very few shops ever manage to build identities or concepts (something that in a previous post I refer to as "terroir of space") that mean something to consumers. While our industry has done a good job in elevating the coffee, and differentiating ourselves on that front, we have done a (relatively) poor job of reaching out across the hospitality spectrum to build the case for specialty coffee (as the article by Tim Varney does in #3 Fool Magazine). 
  2. While the brand exercise is a valid one, it comes up against a series of issues; I'd rather shops engage in the notion of building their brand or shop independent of chain retail (especially where hospitality and coffee especially are concerned) and begin to posit their uniqueness and what they bring to the market that distinguishes them from the alternative.I would also add the caveat that while customers may find the formula chain retail coffee shop enjoyable or agreeable, it is also not to say that a lack of knowing alternatives exist, or participate in a much more hybrid consumer habit; even within specialty coffee, the consumer habits range widely.
  3. My token socialist note for the day: specialty coffee, to me, is in the process of decommodification and the creation of alternative markets for both coffee growers and coffee consumers. So the use of the notion of "branding" to distinguish specialty shops from their perceived chain retail competition is problematic at best and at its worst detrimental to the notion of specialty coffee*. While I do not believe we are readily going to escape the QSR-model of business orientation, I do believe that shops need to understand their participation in, and their active creation of, an alternative marketplace both in terms of their purchasing practices but also what their shops represent within their local economies and their communities. And that's accomplished through true structural changes (to how one assembles a menu, builds a food program, thinks of training, hiring, and payment, or orients aesthetics of their company and built environment), not simply trying to market themselves or brand themselves more distinctively or accessibly, because those should be implicit in the company creation -- if they aren't, you need to rethink your business plan from Stage 1. 

Alternatively, this last point also means challenging -- within the realm of hospitality -- the assumptions about coffee that regular, non-specialty coffee drinkers tend not to think about. This is done through being a systems level thinker, but also through really internalizing how your core business values lead into the systems, built environment, and hospitality service of a cafe run and operate. I know this has been something of a common theme in the last few posts, but given my thesis research, and what I assembled in a multitude of business plan evaluations, this sort of linkage is critical, and at this point in time, critical especially within the coffee industry that calls itself specialty. 

So, thoughts?

*(I realize that, industry-wise, specialty includes the Starbucks & Peet's of the world; I realize that when I speak about specialty I by and large ignore that and focus on the businesses understood, intra-industry, as pursuing "specialty" as vision. (I digress).) 

 

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