Nonetheless it has been interesting to see what they industry press are writing about, what advice is being offered, what strategies are being deemed wise.  A word I am seeing more and more is ‘diversifying’.

Starbucks are in a mess right now, and they have been for some time.  To me the problems are linked to a gradual loss of identity over the last few years.  Right now they are putting out mixed messages – on one hand promoting better coffee, on the other hand discounting it. Worrying about breakfast sandwiches, selling CDs, whilst still trying to claim that they are all about the coffee.

Photo by tonx

For a while, in the UK anyway, McDonald’s were all about salads.  Big money on big advertising campaigns telling us what a good idea it was to buy a salad at McDonald’s.  It didn’t work, that isn’t why we go to that place and walking past a branch on my way home I didn’t see a single salad image on display and I have no idea if they even still serve them.  The saw salad’s as a way to help stop declining sales, instead of actually making the food they had served very successfully taste, and be, better.

We’ve all visited businesses that have scrambled for turnover through diversification – coffees, teas, smoothies, soft drinks, pastries, panani are only the beginning.  Every item added seems to drag the average care and attention for each item down a little.  Nowhere does a huge range of things exceptionally well.  In the end, desperate to catch all consumer demands the business looses all identity.

Imagine I showed you a menu for two different Chinese¹ restaurants.  The first has a typically huge menu of maybe 50 or 60 dishes.  The second menu has a total of 15.  Would you expect a difference in quality between the two?  Would the smaller menu imply a lack of imagination or greater care and attention to each dish?  If each restaurant does two dishes incredibly well – in which menu do you have a better chance of a great experience?

Starbucks do the desert in a cup very well.  They brand it well, they sell it well and if you have a sugar craving then it probably tastes pretty good.  The gingerbread latte has become weirdly iconic, and endlessly imitated.  Those drinks built the Starbucks expansion, and for many consumers they justified the premium price. ²

Starbucks have done a poor job of redeclaring their own identity and it continues to hurt them.  Businesses are looking at a bleak year ahead and I think having a strong identity is key.  You need customers loyal to your business, customers that have a connection with what you do, with the positive experience they associate with you.  Diversity may be a way to sneak up the average customer spend, and I am not saying it can’t be done well, but often it reeks of desperation or overreaction to a natural dip in sales (such as in January…).  Coffee is still a long way from being written out of people’s budgets – as long it is worth the price per cup.

Dropping coffee sales say more about what people think your cup is worth to them than it does about your customers think about the size of your range of products.

1. Or any cuisine with a typically very large menu
2. I justify that simply by the numbers they sold!

First and foremost – we don’t drink coffee like we drink wine. Broadly speaking we buy wine in two different circumstances: to enjoy ourselves and to enjoy with others. Generally we spend more, buy better, buy more interesting when we are enjoying it with others. We want to know more, want a little story, want something worth discussing. Wine’s great success was making it culturally acceptable/desirable to discuss what you drank at some length. Coffee isn’t quite there yet. We drink coffee in different circumstances – mostly it is a solitary affair, though sometimes shared but rarely the focal point the way a stellar bottle of wine can be. We experience it in different environments, with different goals and different focus on the sensory experience.

I also want to look at the route to wine’s success. In the UK certainly a higher spend may have been achieved but the real successes of the wine boom were producers like E&J Gallo. The £5 bottle of acceptable, non-descript, reliable wine. Compared to what had been easily available at that price range in the decades previous these wines were really pretty good. More than that – they made wine extremely accessible.

I recently attended a chocolate and tea pairing, at Tea Smith, with the chocolates by William Curley. There were some toe-curlingly, giggle inducingly wonderful moments and flavours. Talking to both John from Tea Smith and William it is clear that these two commodities could fall into the wine model the way that coffee could. However do push them into that model wouldn’t bring to the fore the most interesting things about them. Microlots of astounding tea don’t fit into the wine model, despite coming from one estate and being one particular type of tea and having an interesting processing method, and listening to William talk about chocolate you felt you could swap chocolate for coffee and it would work as well – from sourcing to vintage machinery!  Yet high-end chocolate has adopted a different approach when it comes to marketing and consumer understanding.

We, as an industry, have yet to find the hook that will encourage the broader public to delve deeper into coffee – to discover the captivating and broad range of sensory experiences available in what is considered a humdrum, everyday drink. It is clear, however, that we can’t settle on trying to piggyback wine because it just won’t work. We must keep looking but I have no doubt that accessibility will be the key.

UPDATE:  Steve Leighton posts on Coffee and Wine.