Problem

 

Consumers think that the store will change in a negative way due to the Nestle purchase.

 

 

Target Audience Personas

 

Darcy (frequent purchaser of Blue Bottle)

Age: 37

Occupation: Lawyer

Lives in: Los Angeles, CA

Family: Boyfriend, no children

Exercise: Takes yoga classes, walks her dogs

Overall health: Has bad sleep habits

Goals: Provide great service to her clients

Worries: Not having enough energy to perform her best at work

 

Jessica (frequent purchaser of Starbucks)

            Age: 19

            Occupation: None, student

            Lives in: Washington, DC

            Personality: Smart, kind, anxious, easily stressed

            Likes: Browsing social media, reading fiction novels

            Worries: Can’t find a nice quiet place to study

            Food: Consistently orders the same things

 

 

Coffee Trends

 

1. People are choosing espresso drinks over all others (24%, leap of 6% since 2016)

 

2. Many consumers drink coffee that is prepared out-of-home (40%)

- Lifestyles becoming more mobile

- People ages 65+ are most likely to drink coffee only at home

- People under 35 are almost one-third more likely to drink coffee from a café or donut shop

- This may contribute to their interest in new flavors and preparation methods because of increased exposure to new beverages and trends

 

3. 30% of younger consumers drink gourmet coffee

- Suggests new opportunities for coffee companies

 

4. A steadily growing taste for gourmet varieties is driving a wider trend toward specialty beverages

 

5. More than half of all cups of coffee consumed in the past day were “gourmet” — a record-high 59 percent, compared to 46 percent in 2012.

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6. Consumers under 35 years old are consuming non-espresso based beverages

- Cold brew, nitro, frozen blended coffee (“specialty coffee”)

- Suggests potential long-term growth opportunities for the industry

- This younger demographic is drinking less coffee than older adults, but they’re drinking “better” coffee

 

 

Other Relevant Trends

 

1. There’s a growing consumer demand for more sustainable products

- 45% of Millennials say that they think more positively of purveyors who sell a sustainably sourced product. And a quarter claim that they would go “out of their way” to get it

- Presents an opportunity for companies to engage and educate their customers who are unaware if products are sustainable

- Consumers are more likely to be willing to pay for “good-for-me” product features that have a perceived tangible benefit to personal health and wellness, such as organic or non-GMO, than they are to pay more for “good-for-the environment” features.

- Very few are willing to pay extra for environmentally-focused features (recyclable or eco-friendly)

- Companies should highlight direct, personal benefits to entice shoppers to pay a value-added premium for certain green products, particularly foods.

- Consumers around the world are saying that a brand’s social purpose is among the factors that influence purchase decisions

 

2. Consumers around the world are becoming more aware of the ingredients in their food and more cautious about what they are willing to eat or drink

- In 2016, 53% of consumers avoided at least five separate ingredients or food attributes

- More consumers are taking their avoidance of specific ingredients a step further and eliminating, or at least limiting, entire categories and food groups (dairy, sugar, carbohydrates, gluten)

 

3. Over the past five years global smartphone ownership rates leapt from 20% of households in 2011 to a projected 58% in 2016

- Changing the way people interact with brands

- Mobile-optimized is key

- Not having easy access to info can cause a company to lose loyalty

- Sharing is down 21%-a massive drop from the year before. Reading, however, went up by 65%.

- Engagement doesn’t matter (likes and comments). Views, plays, and conversations are more important

- Consumption of video continues to skyrocket. Viewing habits have shifted from cable/TV to video clips on mobile devices

 

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Consumer Behavior (What do they currently do?)

 

• The target audience is those who frequently consider the brand. They are at the purchase stage of the purchase funnel. These consumers are aware of the brand and consider it, yet do not purchase due to the Nestle purchase.

 

• Right now, other brands appear more attractive than Blue Bottle because people have a negative view of big brands buying small boutique brands.

• On social media, consumers are saying that the brand will “lose its kick.”

  • Some claim that it is one of their favorite coffee spots and are saddened by the news

  • Others are complaining about the price of the coffee

    • “Wondering if #bluebottlecoffee is your cup of tea (coffee)? Well if you’re open to paying $6 a cup it just may be!”

• Another Twitter user said, “I have no doubt that the quality at @bluebottleroast will remain the same, but I do not agree with the actions & ethics of their new owners.”

• It seems to be that people who love the brand think that it will lose both its authenticity and quality.

 

 

Survey Questions:

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1. What words come to mind when you think about Nestle?

2. Do you think that the quality of Blue Bottle coffee has changed in any way?

3. Would you choose other coffee brands over Blue Bottle coffee? If so, what brands, and why?

4. Has Blue Bottle lost any of its unique appeal?

5. Are you satisfied with Blue Bottle’s customer service?

6. How many times have you purchased our coffee since the merger?

 

 

What do we want them to think, feel, or do?

 

• Objective: Assure consumers that Blue Bottle still has the same quality and flavor that they know and love.

• We want consumers to see the merger as something that is beneficial for their purchasing experience.

 

 

Brand Positioning Statement:

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            For gourmet coffee fanatics, Blue Bottle is the brand of gourmet coffee that has the finest, freshest, and most flavorful responsibly sourced coffee because…

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• “We only sell coffee at peak deliciousness within 48 hours of roasting”

• “We source coffees from producers who are stewards of sustainability. We work directly with farmers around the world to source the most delicious and sustainable coffees we can find.”

• “We evaluate our coffee with a science experiment. We set up blind taste tests at different days out of the roaster. We taste each batch, repeatedly. James and our team of roasting and quality control experts cup all of our coffees before they go into the world. We repeat this process every day. Each time we change a component of one of our blends, we start over. Every time a new single origin is introduced (three to five times per month) we go through the process anew. We then identify a window of peak flavor. When a coffee hits that range, it goes into service at our cafes and onto the shelves as whole beans.”

 

 

 

Big Idea: Blue Bottle is sticking to its roots.

Emphasize factual information about the company (quality, origin, flavor)

 

 

Strategy

• Blue Bottle started as a stand at a farmers market, so they should do this again. They could run a booth and sell the coffee at a discounted price. It would be a way to connect with their loyal local customers.

  • The message is that Blue Bottle has not forgotten how they started

• Blue Bottle hosts a small local music festival. It’s outdoors and takes place over the course of two days (48 hours) and concertgoers are encouraged to camp out. Blue Bottle coffee is sold during the entire festival at all hours.

  • The message is that Blue Bottle coffee is sold within 48 hours of roasting

• Blue Bottle begins a Facebook live video series in which they showcase the roasting process of their wide array of drinks.

  • The message is that Blue Bottle’s coffee quality has not been altered

• Print and online ads: focus on quality, origin, flavor

           

 

 

Current personality: Down-to-earth, informative, calm social voice, witty

 

New personality: Same qualities but even more humble, genuine, and honest. Much more passion and emphasis on connecting with the customer.

 

 

 

Metrics for success

 

Perception:

• Survey consumers to see if their opinion about the company has changed. 

• Track the company’s social media to see what people are saying about Blue Bottle.

 

Behavior:

• Compare the number of sales from before and afterwards.

• Monitor how many views the Facebook live videos receive

 

Awareness:

• Track online marketing efforts with Google Analytics

• Track mentions on Twitter of the company

 

 

 

SWOT Analysis

 

Strengths:

• It is an extremely sustainable brand

• Blue Bottle has managed to crack one of the fussiest markets for high-end coffee: Japan, where it now runs six stores.

• Nestle said Blue Bottle will “continue to operate as a stand-alone entity, while having full access to Nestle’s well-recognized capabilities in coffee and its strong global consumer reach.”

• With the size and bargaining power of Nestle behind it, Blue Bottle will be able to significantly lower the price it pays for everything. But because of the company’s craft image, it probably won’t be lowering the prices it charges to customers.

• Nestle can provide Blue Bottle with a higher marketing budget which can make it a better known brand

 

Weaknesses:

• People in the industry have mocked the “over-the-top” language that Blue Bottle uses in its marketing materials to describe the products. There is a perceived lack of seriousness.

• There have been complaints about the employees being dismissive towards elderly individuals, yet welcoming to younger “hipster” customers.

• The company is receiving an overwhelming amount of backlash on social media and is currently being discussed in a very negative way, especially by its once loyal customers

 

Opportunities:

• Third-wave specialty coffee is rapidly gaining popularity. The niche accounts for 15 to 20 percent of coffee consumed in the United States, according to the Specialty Coffee Association. It also commands higher prices and generates bigger profit margins.

• The growing consumption of on-the-go health drinks has largely impacted the demand for ready to drink products. The enhanced nutritional benefits and compatibility with different flavors is driving the demand for these products. Blue Bottle already sells many ready to drink products and could expand these products even further

• Subscription services are becoming increasingly popular. This format gives coffee drinkers both a customized experience and exposure to new options. 21% of coffee drinkers would be interested in having readymade coffee delivered to their home or workplace, and 16% would consider having freshly roasted ground coffee sent to their home. Door-to-door delivery brings more intimate interactions.

 

Threats:

• As the world continues to warm and rainfall fluctuates, the coffee industry is seeing the start of potentially damaging change. Areas suitable for coffee production — tropical land spanning the globe along the equator — could be cut in half by 2050, according to an August report by The Climate Institute.

• Tea is becoming the beverage of choice for a whole generation of young Americans. When people under 30 were asked if they preferred coffee or tea, both proved equally popular with 42% of the vote each. The most likely explanation for tea's rise is its perceived  health benefits.

• Coffee shops are beginning to invest in innovative new machinery. Blue Bottle utilizes vintage machinery and would need to change their entire aesthetic to accommodate to this trend. Buying entirely new equipment would also be very expensive.

           

 

 

Competitors

 

Starbucks:

It is an extremely popular American coffee company and coffeehouse chain.

 

To millennial coffee addicts, Starbucks is the brand of premium coffee that inspires and nurtures the human spirit because we make sure everything we do is through the lens of humanity – from our commitment to the highest quality coffee in the world, to the way we engage with our customers and communities to do business responsibly.

 

Starbucks is focusing on high end coffee to adapt to the preferences of millennials who prefer gourmet beverages and this is likely to drive the next wave of growth for the company. They are investing heavily to capture this trend by building premium Starbucks Reserve Roasteries. The company has also unveiled cold-pressed espresso, a new patent-pending cold extraction process that will serve as the foundation for a new menu of beverages.

 

 

Balconi Coffee Company:

A “multi-roaster” independent coffee bar that serves a rotating selection of brewed-to-order coffee, espresso, and specialty drinks

 

To coffee lovers, Balconi Coffee Company is the brand of full-bodied siphoned coffee from a pot because we have automatic regulation of water temperature, for smooth and consistent extraction of flavor. The coffee beans that have been exposed to the entire volume of water are allowed the gentle release of the bean’s oils. Brewed coffee is never “cooked” directly, via flame. Keeping the coffee away from the grounds (via vacuum force), prevents over-extraction, resulting in a more flavorful cup of coffee.

 

On its social media, Balconi Coffee focuses on upcoming events and ways to get involved with the brand rather than informative product information. They also feature many artists in their shops and offer social events for their regular customers. Their brand personality is very in-your-face and comedic. “Feel confident that the next time you spill coffee on yourself while wearing one of these babies,  it will go unnoticed-- believe me, I speak from experience! Order yours yesterday.