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).) 

The Unintentional Importance of Chez Panisse

Preparing for a trip to Seattle, I found myself struck with a strange sense of melancholy, almost ennui. Nothing Baudelaire like, and nothing so existential as to wrestle with some Kierkegaardian notions of the world; I think between having my capstone project ahead of me, the uncertainty of employment come graduating in May, and the nature of the world we live in, there are some stressors in the back of my mind that, whilst running around doing readings or working on spreadsheets, they can stay in the back of my mind. But in the down time now, sitting, getting packed and getting preliminary work done of papers over spring break these thoughts have come rushing back in a way that is both frustrating and somewhat paralyzing. 

It's times like this I return to the kitchen. Whether it was managing the kitchen at Stebbins Hall at Cal or working in the pastry department at Huckleberry, kitchens have been where I retreat to for calm. It's my other yoga, the mental space where everything becomes clear, focused, with purpose. When I start quartering fruit, crushing nuts, or compounding spices for blends, my mind goes into a mode set into me through Paul Bertolli's "Cooking By Hand", namely where does this item fit in the scope of a meal? In the scope of my home? My life right now? Will it accompany something I'm already making? Or is it a one-off experiment? Of course, this is preceded by another round of thinking done long beforehand -- namely when I go shopping, what do I bring home? I think to the world of advice in "Chez Panisse Fruit" and "Chez Panisse Vegetables" for tips and features about specific types of fruit and veg and the preps to extract flavor. While not one to take (lots) of fancy set up photographs of the food I make, I do think to the letterpress work of Patricia Curtan, and the unfailingly rustic, hand-hewn way she presents things. And I think of the connectivity between these works -- that in none of them you're being beaten over the head with preciousness and twee appliques. You're being given advice and kitchen banter the way that you'd hear between neighbors and friends.

I never worked at Chez Panisse; I've eaten there a half dozen times, and more than I can count at the restaurants and operations of alumnus from the CP kitchen -- especially Charlie Hallowell at Pizzaiolo in Oakland, and the Tartine After Hours of Samin Nosrat. But a lot of the things that come out of that kitchen -- especially the sensibility of "la famille Panisse" -- have come through in the spaces and people I have met through there, and through the books those folks have published, their online writings, and their openness in activity. A lot of my personal hospitality training and methods are gleaned from the my observations and interactions with the family at Chez Panisse, and they're things while commonsensical in mind are rare to be put into practice. Treating guests like family, and having a staff that does that too. Treating your work like a craft, and treating that as part of your whole person. And treating seasonality, cultivar, craft and a host of other things that sometimes get lost in this world (and sometimes get beaten over us with a stick) as something that is just at the core of a project, that inform how it runs, and are essential to the hows and whys and ways things are run as paying the bills. 

That certainty of self is something that I admire about Chez Panisse, and its something that every time I enter a kitchen, I feel more and more. The cooks and authors of Chez Panisse have been my unintentional instructors, giving me the mindset to work in the kitchen; the service in their restaurants made me see what makes these places more than just restaurants but places of convivia and frankly, places you want to return to, that know you when you do, and are as much an extension of your home as can be naturally applied to the private sphere. Every time I go into a kitchen I feel those things come back to me. And every time I leave one I am reminded why it is I'm doing what it is I do. 

The Importance of Words

Yesterday Kyle Glanville, co-owner of G&B Coffee in LA, former Intelligentsia rainmaker, and all around well regarded figure within specialty coffee, made the following statement:

                : Specificity > Vague Adjectives – Sustainable, artisanal, traceable, specialty, fresh, seasonal mean nothing now. :

This has been a longstanding complaint across the food spectrum – the adoption by marketers of half these terms, the cynical appropriation of expanding these terms to industrial practices, the ever-so-twee application of the heirloom cupcake. The dilution and back-and-forth over the terminology of organic certification. Pumping out “artisan” bread at one loaf every 6 seconds from a machine. And in specialty coffee, the use of direct trade to mean everything from breaking bread with the farmer who you see twice a year, to talking with your importer and ordering your coffees through your importer the way you have for the last 20 years. And in many circles there are, from farmers to small scale value-added food producers to coffee folk, frustrations with terms and a total willingness to throw everything out, or otherwise mock/demean/cast out anyone who uses the terms as hollow hacks or naïve schills.

Three things about these complaints:

1)      There is a kernel of truth in them. Whether government regulated definitions or voluntary, non-trademarked adjectives, there are very many misappropriations and misuses of these terms. These dilute and destabilize the efforts of people who do produce agricultural products in a truly sustainable matter (and there is such a definition, see 3), or source their materials in a way respectful to producers or of high qualifications of craftsmanship (see 3).

2)      If there is anger over this, at least in specialty coffee, people seem more content to whine and emote about it than actually call people out on it. Playing nice within the industry matters more than attempting to make firm definitions and parameters for some of these terms through trade associations, professional firms, or other outlets. Sustainable ag has done this for a while with regards to organic certification, decrying certifiers with loose standards, farms electing to sign on with certifiers who have standards above and beyond the stringency of the NOSB parameters, and advocating/lobbying for more stringent organic rules and norms in law. We need to constructively critical of businesses and individuals who view this strictly as a marketing thing and understand there are systems and values that need to guide businesses, not aesthetic niceties and soundbites, and this is something specialty coffee writ large is really unwilling to do.

3)      The complaints about terms shows the exceptional lack of knowledge about these terms by people in specialty coffee, which is my key frustration. Having kept one foot in food justice and sustainability politics as long as I’ve been involved in specialty coffee (almost a decade now), and consistently amazing to me is the lack of interest in examining or involving oneself with sustainable agriculture or craft industries (with craft beer or cocktails being perhaps the one exception, and sometimes, not even that). There’s no awesome definition of sustainability? I’d lead you to the triple-bottom line definition and promoted by Cradle to Cradle, or the host of Food Policy Council definitions all of which take into consideration elements of ecology, financial, and social demographics and outcomes. Artisanal? The terms and definitions given to vendors by The Good Food Merchants Guild. California Certified Organic Farms, the Soil Association of the United Kingdom, and Oregon Tilth have the most strident, systemic definitions of what constitute organic and certified organic; if that doesn’t seem enough, look to Demeters biodynamic definitions and practices. Fairtrade, for all its failings on quality assurance, at least takes a serious task in democratic norms and workers rights into consideration for its certification. And no one at this point can touch the transparency of Counter Culture has produced in their Direct Trade program (and note – not every bag of theirs has it on them). Not sure what makes your “local” economy? Look at Localism 101, an organization who defines it in terms of inter-generational wealth building within community-based businesses.

These frustrations can be summed up in a recent (also-twitter based) interaction. I interacted with James Hoffman via twitter a few months ago, wherein I was critical of an exercise he held with some associates seeing if they could differentiate in taste between organic and non-organic produce that was procured from a grocery. I asked whether or not this exercise wasn’t faultily constructed – cultivar, degree of organic certification & growing practices, and geographic provenance have an impact on flavor, and with the host of non-taste-derived benefits of organics, is it fair to assess these two as equivalent (especially when, as the outcome proved inconclusive, the walk-away is that there is no major distinction between organic and non-organic, so why support it)? The response was it was just a fun exercise. Half-snarkily, I asked if they could taste the soil degradation or smell the pesticide residue in workers lungs.

As an industry we need to be thoughtful, engaged, and proactive about both words and systems. Words like “sustainable” or “artisan” are only as useful as the systems that prop them up, and only those systems can provide a model alternative for businesses who may only know those words as a marketing ploy or a half-assed definition of the term. Traceability can mean something if companies are willing to put groundwork for it. Expertise can be qualified by other experts. And craftsmanship can be delivered through the end product; hospitality isn’t just about greeting and expediting – it’s culture making. We do not need to scream from the rafters about the values of our work – our cafes, our product, our employees can do that without having to utter a word. And we as an industry need to be willing to commit ourselves and our energies to promoting, upholding, and advocating for these definitions not just for our own companies but companies of our grade and parameter. We need to be the builders, the warriors, the weavers of our craft, and start making those connections between words and systems, starting now.  

Slow Foods New Leadership

After the departure of Josh Viertel from the leadership of Slow Food USA six months ago, a new leadership has taken up house in the national organizations Brooklyn offices. Richard McCarthy, who previously headed the Crescent City Farmers Market and related organizations in New Orleans has now taken up the leadership role in heading up SFUSA. 

To his credit, Mr. McCarthy seems to have some pretty good accolades: as the co-founder of the CCFM, his leadership has expanded its footprint and influence, especially in the post-Katrina landscape of New Orleans and the surrounding agricultural district. Through its organiztion, Market Umbrella, the CCFM has acted as a mentor for up and coming farmers markets authorities, built coalitions with regional (such as the Oxford Food Symposium) and national organizations (such as the Project for Public Spaces), they have been able to both raise awareness, and helped raise both consumer and political awareness of the food system in New Orleans, if not the South as a general category. He certainly speaks well; in both his above interview with Julia Moskin above as well as this Oxford American interview in May 2010, the man can talk the talk, and seems to understand some of the more complex underpinnings of how marketsplaces act. Money quote: 

The question of market impact is where we have invested much of our energy, especially over the past decade. Integral to our belief that public markets can serve as strategic levers for social change is that to use them you need not change your idea about the world upon entering the market. There is no admission. There is no ideological litmus test, other than, when on-site, everyone treats one another with dignity and mutual respect. In fact, this is largely what our job—as market managers—is: to create an environment where this social contract is maintained. Both vendor and shopper should feel welcome, regardless of their beliefs. This social contract is perhaps as valuable—if not more so—to a community as the exchange of food. 

This is a good mark; especially as I wrote in my paper on farmers markets in June of last year, there is a need for markets to conduct themselves in such ways as to make sure the population of those accessing and utilizing markets grows. And at this point I can only wish the man well and hope that this proves to be a good development for the organization; as he himself has pointed out, his first order of business is making sure that members and supporting organizations know that there is a secure leadership, which is a good step, though I know I'll be looking for more concrete initiatives in the near future. 

I will also indicate, however, that at this point, the political story here that has unfolded has proven a very interesting one; it is telling that Mr. McCarthy is from New Orleans, also home to Poppy Tooker, the Slow Food leader who led the seemingly one-woman campaign against Viertel last year. While there were a number of issues at play at Mr. Viertel's departure (institutional culture at the Brooklyn office, the relationship and operations between Brooklyn and convivia, the goals and aspirations of the convivia during the administration prior to Mr. Viertel and upon his arrival, the status of the Ark of Taste project, among others), the placement of Mr. McCarthy at the head of the organization, given where the seeming core of Mr. Viertel's "opposition" came from, should be noted.

And I use "opposition" in quotes because I think, at the end of the day, the issue really being played out prior to the departure -- is Slow Food about food justice or about food culture -- was a false dichotomy. Projects like the $5 Dollar a Day challenge were not to undermine paying farmers a fair wage, in the same way relegating the Ark of Taste to a convivia-based project was not an attempt to ignore biodiversity. Contrary to the claims about Carlo Petrini bemoaning the "politicization" of Slow Food in the US, unlike its European counterparts, the American food system -- from agricultural production to crop biodiversity, food justice to culinary history -- has had disruption at a lot of levels, and needed to be rectified and revived at a number of levels. None of these are atomistic -- they are all very interconneted. And unlike in Europe, where Slow Food came out of a response from within the Italian Communist Party, in a country with a long culinary history as well as a given civic response to food culture (as well as political institutions that supported and defended those norms), this is one of those instances where the American iteration was bound to stand apart, and in a way that does matter if SFUSA wants to remain relevant.

My thesis work is currently leaning towards the income double bind in the American food system: namely, that most farmers need to be able to charge more to shore up the financial and economic sustainability of their operations, while most communities across the board -- from the supposed middle class able to afford "good food" to lower income communities that have a desire to access such food -- need jobs that actually provide them the financial means to access such food. That is the question of "good food" in a just, equitable food system: income. And it is this particular conundrum that SFUSA must take leadership on in its near future. The convivia cannot only be dinner clubs that cater $80-100 events once a month; they also shouldn't exclusively do programming that deals in food justice and curious challenges. But it has to be more than it has been, something Mr. Viertel attempted to do, perhaps clumsily, within the organization. SFUSA, like the organization Mr. McCarthy comes from, must act as an umbrella for all the stakeholders and members of the good food community, and not be a reified version of itself. If his past is any indicator, Mr. McCarthy will hopefully be the mind for such a mission.  

Blue Bottle Comes Out

Reported today in the pages of the NYTimes, TechCrunch, and the Wall St. Journal, James Freeman, the artsy, occassionally eccentric and overall generally loveable founder of Blue Bottle Coffee Company is no longer the owner, having transferred most of those remaining rights to the head of True Ventures, Bryan Meehan. True Ventures placed a 16.8 million dollar flux of cash recently, buying out the previous 6.8 million given by Kohlberg Ventures back in 2008 (remember how Mint Plaza, the MoMa expansion, and the New York adventure started all about the same time? Now you know). While James will be staying on as some sort of face for the company, he is officially announced that he is no longer the owner. 

The thing is, he hasn't been for a long time -- since the Kohlberg venture in 08, he's had a minority stake in his own company, having more or less a creative directorship of sorts. And since 08, the company itself hasn't even been a "local" SF or Oakland company, with Kohlbergs official legal title being in Portola Valley, CA, and True Ventures having their legal title in Great Falls, VA, the profits from those operations are diffused between different entities and individuals, most of whom do not live in the Bay Area. While Blue Bottle staffs many people in the Bay Area (and to this day, provides one of the best in-house pastry programs I have seen for a cafe, courtesy of Kate), it hasn't been a local player in the larger economic sense for a while. 

This is sort of the worry and the case study for investment capital typically -- whether the La Boulange example, or Stonybrook in the case of dairy -- the purchase of companies by entities that eventually take them (financially) outside of the local economy, as well as the ownership. Quality considerations are always in question, because the notion of who is in charge and what the qualitative stakes and positions are of the new company (including how much per pound green, in the case of coffee, should be expected). And while quality has never been a big suit to Blue Bottle (Chris Tacy, in a Wired piece on the matter, notes that Blue Bottle has mostly been about image, marketing, and concept. I think this is largely true, but also wasn't always the case.) the question of what the product, the service will become can be held in question. 

Consumers should be aware of such changes, and the gimmick of keeping staff on even though their overall power within a company might be limited. James is being kept on retainer with increasing shares to keep him at Blue Bottle. And Duane Sorenson, as the Willamette Week has checked into a number of times, hasn't quite been forthcoming about the control, ownership, and direction of Stumptown (despite whatever one might think of Todd Carmichael or Tony Dreyfuss, the documentation concerning the legal corporeability of Stumptown can bring into serious question what the nature of such relationships are, and what the overall nature of the relationships, purchasing methodologies, etc might be in the future). If we care about the issue of local economies, then these companies have little to offer. 

Now some say these investments are a great validation of the specialty coffee sector (aforementioned Chris Tacy gives the best evaluation of this argument in his blog). And I agree it is fantastic when capital gets behind good projects. This is contingent on two things however. One: the company has to still be lead by the same practices that made it awesome. The relationships must be kept in place, the procedural methods and the risk-taking, with a high focus on quality (be it conceptual and/or material) being maintained. And secondly, we have to remember that food products are different than technology. The quality of care in procurements, in the treatment of relationships, and the ecological, economic, and social concerns of those producing it, especially in the case of products such as coffee, chocolate, or tea, are conssumately protected. Capital tends to obfuscate or eliminate both of these goals; in the case of Stonybrook, smaller independent farmers gave way to larger cooperative dairies that would not meet the original Stonybrook mission of ecological protection (but fit the bill -- barely -- on organic standards). La Boulange swears that artisan materials can be maintained when being produced regionally and distributed nationally. In coffee, we have yet to see, but if the intial drop in quality that occurred when Blue Bottle grew in 2008 is an indicator, or if the generally lackadasical hiring practices that we've seen at Stumptown (has anyone had a really good shot of Hairbender in the last two years? Please let me know where), there is generally something lost when that geeky obbsessive, eccentric person no longer has control over what gets put out into the world.

Growth is a good goal, but it is not the only goal. Part of what makes specialty coffee -- and indeed, much of the sustainable food community worthwhile -- is that it is growth moderated by the ability to pay attention to social, ecological, and economic concerns. Quality fits into many of those, as people who are paid well pick better coffee; farmers paid more to pay attention to ecological concerns tend to produce better cherries and better harvests. And baristas and staff paid consummately and trained to be educated in their approach to coffee tend to be able to translate into better profits as they know hospitality and enthusiasm in their right place and balance with customers. If those are forgotten at any length of the chain, then specialty coffee ceases to be impressive, and simply becomes a marketing ploy. And if that kind of growth is what eventually becomes of specialty coffee, we might as well go and hit the showers.