Alliance, Neb., has 8,500 people, a big corn-farming industry and Carhenge, a Stonehenge replica made of cars stacked on each other. When five c-stores in the region started selling organic Guatemalan coffee, it wasn’t exactly a big hit.
“They wanted us to pull it out of the stores because it wasn’t selling, and bring in a new blend,” says B.K. Larson, sales representative for St. Louis-based Ronnoco Coffee.
But was the coffee itself at fault? Larson realized a label calling it organic and foreign probably wasn’t the best angle to use in farm country. So the stores agreed with Larson’s suggestion for new signage.
“We just labeled it Cowboy Coffee,” Larson says, “and sold the heck out of it.”
Positioning is everything. Signs touting a coffee’s fair-trade bona fides may work in some neighborhoods, but in others you’ll sell more by calling it a “natural energy drink.” How do you develop the right marketing for your coffee program and make sure it will appeal to your core customer?
Lucky for you, the industry has plenty of answers.
Tell Your Coffee's Story
Coffee marketing is at once a reflection of your product and also of your customer, according to Jennie Jones, vice president of sales and marketing for Concord, N.C.-based S&D Coffee & Tea, which sells to Circle K, Kwik Chek and Rutter’s Farm Stores, among other chains.
“Tell the coffee story: the origin and profile and the roast,” Jones says. “Then you have to be serving good quality coffee, and it has to be based on the demographic profile of the area.”
Such a branding strategy made a big difference for Ryan Razowsky, vice president of Deerfield, Ill.-based Rmarts. His Chicago-area chain introduced a branded coffee program through high-end local roaster Metropolis in one of its five stores. While the coffee is similar to the previous product, Razowsky says customer perception is very different.
“We doubled our coffee sales in a year,” he says.
To match Metropolis’ cachet, Razowsky grinds beans on site and holds the coffee in airpots instead of brewers. Coffees are labeled by country of origin, there’s a custom-made chalkboard for the store manager to share information on brews, and there’s even an airpot holder crafted out of wood. Now the store sells 30 to 50 cups a day—up from 10 to 20 before the change.
Chris Smyly, director of marketing for Denver-based Alta Convenience Stores, has likewise overseen branding efforts with and without changes to the product itself.
The 57-store chain took advantage of a store rebrand three years ago to overhaul its coffee program. It combines Boyd’s coffee with its own branding and signage, developed in conjunction with Denver sign company Ultimax Inc.
Cups per day were up 7% in the first year and up 2% to 3% the second year; stores now average $1,600 to $1,700 in coffee sales per month. Because Alta took the opportunity to raise prices, profits were up even higher: 9% and 5%, respectively.
Smyly says that he attributes 1% or 2% of the success of coffee promotions solely to naming and branding, and he isn’t afraid to adjust a product name to better fit his market.
“It’s worth a couple of points dependingon the success of that flavor,” Smyly says. “A couple of points is big for us.”
Smyly has also experienced the importance of local preferences. Two years ago, he ran a promotion on seasonal flavor Highlander Grogg with coffee from Boyd’s. He was surprised to discover one store in Osborne, Kan., still selling it today.
“At that particular store, it was a huge hit,” Smyly says. “It’s just not normal for us, but when you talk to the manager and he tells you this is a huge hit there … we try to give our stores the flexibility.”
You might not think well-educated soccer moms would flock to an Xtreme Dark Roast, but they do when the name is changed. Don Bergin, vice president of Ronnoco’s c-store division, says that by using two labels for the same product, he’s been able to segment their market.
“I’ve got stores where we sell our Xtreme Dark Roast coffee as having a higher caffeine content,” Bergin says. “That’s usually a truckstop location, closer to college campuses, places we feel people are looking for an energy boost. In other markets, I sell it as Full City Roast because it’s in an urban environment. We’re trying to attract people who are coffee-shop customers, not just looking for extra caffeine.”
CONTINUED: An Emotional Response
An Emotional Response
As with many things coffee-related, names can conjure a strong emotional response for the customer—for better or for worse.
“Some names can be polarizing,” says Sharon Porter, director of sales and marketing for Lake Zurich, Ill.-based Insight Beverages. “For example, the flavor Egg Nog: Some people like it, some people don’t, or think they don’t. However, if you rename it to Vanilla Custard, it’s the same great flavor profile coupled with a name that carries a more positive identity.”
A coffee drink’s name “should be easily recognizable, and it should help set your consumers’ expectations on what their drink experience is going to be,” says Brenda Renee’ Turner, marketing director of beverage brands for Kerry, Beloit, Wis. From there, she says, consider ways it can reflect your overall brand.
“In the specialty-coffee world, there are a lot of brands that extend their concepts and ambiance into their beverage names,” says Levi Andersen, beverage product specialist and lead barista for Kerry. “One simple example is Caffe Ladro in Seattle. Their name is Latin for ‘coffee thief,’ and one of their popular drinks (a mocha with orange zest) is called the Medici. Special name, special drink, all fitting with the brand, which has a light Italian ambiance.”
And stay on top of ever-changing food trends. “With all the research we have looked at, we were surprised to learn that in foodservice consumer demand for organic was declining,” says Andersen. “The real need and interest has been centered around having a range of all-natural offerings, or interest in specific ingredients such as avoiding high fructose corn [syrup].”
Understanding Your Customer
In the end, whether you end up with a Cowboy Coffee or a Highlander Grogg depends on how well you understand your customer. David Leshock is the vice president of Auto City Service, a 22-store chain based in Fenton, Mich. He took a shortcut in the branding process by bringing in coffee from the Coffee Beanery, a national company his upscale customers already knew.
“They’ve got coffee shops throughout the entire state, and that lends a little bit of credence,” Leshock says. “It’s like buying a Starbucks at a fraction of the price."
The expanded coffee area and signage has significantly increased sales, Leshock says. Surprisingly, the product itself isn’t necessarily better. The chain’s previous supplier was a local business and coffee was ground fresh in stores. But without the slick branding of the Coffee Beanery, it wasn’t as competitive.
“It was a pretty good product,” Leshock says. “The people out there, they loved the taste of the coffee. It just didn’t have the name and backing of a major supplier.”
Once your program is established, think further about ways to induce trial—especially as quick-service-restaurant competitors literally give their beverages away for free through special promotions.
Andersen of Kerry recently saw a different promotion that caught his attention. “A business was offering a punch card of buy 10 and get one free drink, which we have all seen before, but the difference was each drink was different,” he says. “So the customer had to buy drinks that they probably wouldn’t try on their own.”
Most c-store owners don’t think of rebranding coffee until they change the entire program. But if you listen to your customers, you may find it’s merely a question of perception. Testing new signage, labels and branding can be a cost-effective and simple way of increasing sales either chainwide or store by store.
It’s an avenue worth exploring before you put time and effort into an overhaul. Depending on the sophistication of your coffee drinker, Razowsky of Rmarts says, a rebrand can be just as powerful as an overhaul.
“If you’re changing the branding,” he says, “you’re changing people’s perceptions.”
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.