How can one compete in a world saturated with coffee shops?
I live in a small village north of London and, in our small town of rural England with fewer than 30,000 people, we have in excess of 10 dedicated coffee shops. In Seoul, South Korea, coffee shops line the streets like a colony of ravenous ants on a food-seeking mission.
In the past decade, the rise of coffee has gone from a commodity to a product, and has now become a lifestyle, a symbol of a generation seeking meaning and purpose in simplicity.
The pleasure of a cup of coffee in one hand and a smartphone in the other has replaced the alcoholic drink and cigarette of old. A product that emerged from Christopher Columbus’ imagination a few centuries ago is now part and parcel of the landscape of the world’s leading metropolis, down to a village a few miles down the road from my home.
Coffee goes beyond being a mere beverage. It impacts fashion through its body and cup art, driving creativity and dividing aficionados like a local football derby. It used to be a sideshow to people conversing and dining al fresco on a faraway terrace. It has now taken centre stage. Conversations have been usurped by chats, electronic bytes without emotion scattering the electronic airwaves with annoying sounds, staring at and tasting an amalgam of infinite permutations involving two basic products – milk and coffee. These two products deemed basic, even at times of war, have become noble with people worshipping at the altar of a mere smoky cup.
But back to the hard and cold reality of business, and the basic and delicate balance between supply and demand. Coffee shops can only survive by being profitable and, in view of this saturated landscape, how does one survive? Having the best coffee is as objective as is having the cutest child. So, how does one differentiate his/her establishment and become a signal in the midst of so much noise?
Is it brand, price, location, people, products, machines, economics, politics, logistics, weather conditions, environment, advertising or even time itself? I am sure that some Ivy League school will soon turn this quid pro quo into some sort of thesis, developing a matrix and a formula that works as a panacea for all ills. Marketing experts, lifestyle gurus, accountants, lawyers, designers, etc (on both sides of the Atlantic) have been burning the midnight oil in search of the elusive formula for coffee shop world domination.
However, let us think outside the box for a moment and introduce a bit of simplicity amid the various coffee waves that make us believe that scientists have all the answers, and that knowledge and wisdom are one and the same thing. Let us make a fool out of the experts and define a product simply by what it represents and nothing more.
A coffee shop could be construed as a simple box with people going in and out of it. There are people who get paid, and those who pay. The buyers are looking for a compelling value proposition, a mixture of variables that create an emotion, an attachment to the box they can now identify with. It’s filled with people and products they like. An ambiance in which they feel at ease. An interface that promotes comfort and warmth and a positive ecosystem (or what used to be known as a community). In that realm the end product is the emotion, the belongingness, not the clever strap lines and loyalty cards.
People are fairly predictable – we all want to belong somewhere, find an environment in which we can develop and even prosper. People are also very uniquely different. Providing formulaic and rigid solutions doesn’t work everywhere every time. It‘s important to provide environments that offer a degree of flexibility to give room to people’s individuality. What big brands value is not always right, and not always what people want.
Branding means providing a constant environment and catering to those who want the same thing all the time, the general public. This is what’s made chains a global success. Regardless of which McDonald’s you frequent, a Big Mac is always the same.
However, we now have an emerging generation that is no longer defined by external brands. People want to express their individuality through creative choice. And while it can be defined as possibly immature, childlike even, their courage in their quest for personal freedom must be admired and respected. In the very near future, this generation will dominate the spending stakes and it will then need to be heard.
In the world of coffee solutions, there used to be a clear order, but this too is fast changing. You can now have a great cup at home, at your office and even in a convenience store. Improvements in automatic equipment has meant that the vast majority of us can make a decent cup of coffee without the help of a barista. Big brands in search of growth have developed solutions to fit all market segments. But has that been at the expense of their core offering and diluting the relevance of the coffee shop? Have people suffered from brand fatigue giving rise to the emergence of the ‘independent’ coffee shop?
In today’s present reality, big brands eventually swallow up the no longer ‘independent’ anomaly and restore the corporate landscape to its initial scenery. Yet, new small coffee shops keep being created every day, becoming profitable as loss leaders do not pay the rent. This continuous birthing of new ventures is a clear signal that the general public like and want this alternate state where the misery of choice remains a valid option. The reason we like choice is that we all seek to find a place where we genuinely belong. A place where we can be authentic, transparent, enjoy a great coffee with friends or even, a novel thought, on our own.
Tomorrow’s coffee shops, as with other experiences, must provide an old fashioned community to their customers. After all, we are only emotional beings having a human experience, an interface with the material world. This ecosystem, rather than divide or segregate an already crowded and confused market place, will create a new environment. A place where people can develop and even prosper, a nurturing extension of their homes.
As for me, in the midst of global travels, I always look forward to coming back to that little coffee shop a stone’s throw from my doorstep and engage with my loved one, a cup of steamy espresso in one hand and my smartphone in its rightful place, on silent in my pocket.
It is true. Dorothy was right. There really is no place like home.